How Price Convergence works
Price Convergence replaces manual correction with protocol-level logic. The Arrakis vault runs an active strategy that rebalances the position over time. On each rebalance, the Price Convergence hook reads the asset’s reference price (NAV), updates the pool’s internal price to match, and redeploys liquidity around the corrected price. Price Convergence is made possible because Uniswap v4 exposes programmable hooks that modify pool behavior at the protocol level. Earlier AMM designs have no equivalent, which is why externally-priced assets have historically depended on manual maintenance.Reference sources by asset type
The hook reads whatever reference fits the asset. The common mappings:| Asset type | Reference source |
|---|---|
| Tokenized commodities (such as gold) | External spot price feed |
| Tokenized treasuries and NAV-based credit | Onchain NAV feed |
| Tokenized equities | Equity price feed |
| Non-USD (FX) stablecoins | Forex rate feed |
| Yield-bearing assets | ERC-4626 vault exchange rate |
Ways teams use it
Continuous reference tracking
For RWAs and assets that should always reflect an external value, Price Convergence keeps the pool aligned to the reference on every rebalance. The onchain price tracks the underlying continuously, with no manual maintenance.
Price alignment at launch
For onchain token launches, the DEX price can drift from a CEX listing price, leaking value to arbitrageurs as they close the gap. Price Convergence aligns the pool to the CEX price from the moment trading opens, the pattern used with Uniswap CCA.
Requirements and trust model
A reliable reference feed.
Price Convergence is only as accurate as the source it reads. Supported sources include Chainlink, Pyth, and Redstone price feeds, onchain NAV contracts, and ERC-4626 exchange rates. These are defined by the team upfront.
The reference feed is the trust anchor.
The pool tracks whatever the configured feed reports, so the accuracy and integrity of that feed determine how well Price Convergence works.
Uniswap v4.
The hook requires Uniswap v4. It runs on the chains where Arrakis operates v4 vaults: Ethereum, Base, Arbitrum, Optimism, Unichain, and Ink.
FAQ
Is Price Convergence an oracle?
Is Price Convergence an oracle?
No. Price Convergence consumes a price feed from an oracle, such as Chainlink, an onchain NAV contract, or an ERC-4626 exchange rate, and acts on it by updating the pool’s internal price to match during a rebalance.
Does moving the pool price let arbitrageurs extract value?
Does moving the pool price let arbitrageurs extract value?
No. A manual correction is a visible trade that front-runners can exploit. Price Convergence updates the price atomically inside the rebalance, with no open window to trade against, so the correction does not leak value the way manual trading does.
How often does the pool converge to the reference?
How often does the pool converge to the reference?
Convergence happens on each rebalance, so the cadence follows the strategy’s rebalance frequency. Assets that need tight tracking are configured to rebalance more often. The reference feed and the rebalance schedule together determine how closely the pool tracks the real-world price.
Which chains support Price Convergence?
Which chains support Price Convergence?
The chains where Arrakis runs Uniswap v4 vaults: Ethereum, Base, Arbitrum, Optimism, Unichain, and Ink.