Concentrated Liquidity and a Recurring Technique backtested utilizing actual historic information.
Two methods commerce the identical CELO/USDT market from January 1 to September 19, 2026. Each begin with 1,000 USDT and use the identical outer value boundaries of 0.07 to 0.09 USDT per CELO.
The Concentrated Liquidity place positive factors 2.81 USDT, producing a 0.28% ROI versus holding.
The Recurring Technique positive factors 336.08 USDT, producing a 33.61% ROI versus holding.
The pair, interval, beginning price range and total value space stay the identical. The distinction was how every technique was instructed to purchase and promote.
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The Similar Beginning Level
On the time of the simulations, the Carbon DeFi Discover web page reveals CELO/USDT as the preferred buying and selling pair on its Celo deployment, so I made a decision to make use of it for each simulations.
Each backtests use:
Interval: January 1–September 19, 2026Starting price range: 1,000 USDTOverall value boundaries: 0.07–0.09 USDT per CELO
Concentrated Liquidity: One Overlapping Vary
The Concentrated Liquidity place makes use of one steady vary from 0.07 to 0.09 USDT per CELO, with a 0.05% charge tier.
Its purchase and promote zones are overlapping, occupying the identical vary. Because the market strikes via it, the place progressively converts between USDT and CELO.
Recurring Technique: Separate Purchase and Promote Ranges
The Recurring Technique divides the identical total value space into two impartial orders:
Purchase CELO: 0.07–0.078 USDT per CELOSell CELO: 0.082–0.09 USDT per CELO
The house between 0.078 and 0.082 creates a customized unfold the place neither order trades.
The technique begins with 1,000 USDT allotted to the purchase order. As that order fills, the CELO acquired mechanically turns into accessible to fund the linked promote order. Because the promote order fills, the USDT proceeds rotate again to the purchase order.
This enables the technique to repeat because the market strikes between the 2 ranges.
The Outcomes
For this historic interval, the Carbon DeFi Simulator experiences:
Concentrated Liquidity: +2.81 USDT and 0.28% ROI versus holdingRecurring Technique: +336.08 USDT and 33.61% ROI versus holding
The Concentrated Liquidity place purchased and offered all through one overlapping vary. The Recurring Technique solely purchased inside its decrease vary and solely offered inside its higher vary, preserving a customized unfold between the 2 actions. Though the unfold was small, at 0.04 USDT per CELO, the affect was vital.
What the Backtest Reveals
I anticipated the 2 methods to behave in another way. I didn’t count on the distinction to be this massive, particularly with what I’d take into account to be a modest unfold.
The Carbon DeFi Simulator reveals how a lot the construction of a method modifications what occurs to our tokens — and our incomes potential — even when the pair, beginning price range, time interval and outer value boundaries stay the identical.
Apply customized token pairs, costs, ranges, budgets and spreads to as much as three hundred and sixty five days of historic market information. You may overview each simulated commerce, observe the altering token balances and examine totally different parameters earlier than deploying something onchain.
Begin with the technique you suppose will work. Then change the ranges. Add a variety. Examine it with one other technique kind.
It’s possible you’ll verify what you already imagine. It’s possible you’ll discover that one small adjustment fully alters the end result.
On this case, it did. Separating the purchase and promote ranges produced roughly 120x the ROI.
Bancor
Bancor is a pioneer in decentralized finance (DeFi), established in 2016. It invented the core applied sciences underpinning nearly all of immediately’s automated market makers (AMMs) and continues to develop the foundational infrastructure vital to DeFi’s success — specializing in enhanced liquidity mechanics and sturdy onchain market operation. All merchandise of Bancor, together with Carbon DeFi and the Arb Quick Lane, are ruled by the Bancor DAO.
Carbon DeFi — Powered by Bancor’s newest patented applied sciences: Uneven Liquidity and Adjustable Bonding Curves.
Dwell on Ethereum, Sei, Celo, COTI, and TAC.
The Arb Quick Lane — Carbon DeFi’s built-in solver system and DeFi’s most superior arbitrage infrastructure, powered by Marginal Worth Optimization, a brand new methodology of optimum routing.
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What Occurs When Purchase and Promote Ranges Don’t Overlap? was initially printed in Bancor on Medium, the place persons are persevering with the dialog by highlighting and responding to this story.
