Protocol Architecture
HFDX follows a modular design with separation-of-concerns, ensuring each protocol component is auditable, maintainable, and upgradable without compromising system integrity.
Core Components
| Component | Function |
|---|---|
| User Wallet | Asset custody, transaction signing |
| HFDX Router | Centralized execution gateway for all trades |
| Margin Engine | Risk, leverage, and margin computation |
| Liquidity Pool | Capital provisioning and loss absorption |
| Funding Module | Funding rate computation and periodic settlement |
| Oracle System | Provides external price indices |
| Liquidation Module | Force closes positions under margin breach |
| LLN Manager | Lifecycle management of Liquidity Loan Notes |
System Architecture Flow
This architecture ensures clear separation between:
- User interaction โ Router & Wallet
- Risk calculation and margin enforcement โ Margin Engine
- Capital management โ Liquidity Pool & LLN Manager
- External data integration โ Oracle System
- Position resolution โ Liquidation Module
The modularity allows for incremental upgrades while preserving immutable core logic.