ALFA’s indicative liquidity category is 5% of the documented supply design. It confirms no exchange listing, trading depth or market-maker agreement. If the programme later appoints a liquidity provider, its mandate should explain the service purchased and the controls governing resources, rather than imply that a budget can guarantee an exit price for holders.
State what the provider must do
A liquidity arrangement might define permitted venues, quoting responsibilities, reporting and use of supplied assets. The exact agreement matters. A provider should not receive a broad instruction to support the price without a lawful, specific and reviewable operating scope. The programme needs to identify the assets committed, ownership, custody and treatment of gains, losses and unused resources. Token units alone do not establish the other funding required for a market. ALFA’s reporting should identify the mandate governing each liquidity arrangement, distinguishing an earmarked allocation, executed agreement and operating deployment.
Recognise the conflict in the role
IOSCO's crypto-market recommendations discuss conflicts where platform or service functions overlap with principal trading and market-making. The practical lesson is to identify competing incentives before granting authority. Consider a hypothetical provider that both advises on distribution timing and trades against the resulting flow. The programme should examine access to information, decision separation and permitted activity. Disclosure may be necessary without resolving every conflict by itself. Independent oversight and contractual restrictions need to reflect the actual relationship. A convenient provider should not receive several sensitive roles without an explicit assessment of how those powers interact.
Measure the agreed service
Reports should show the resources used and performance against the actual mandate, with enough context to understand interruptions and exceptions. Trading volume alone can be an incomplete or misleading measure of market quality. The programme should examine the relevant records and avoid rewarding activity that does not serve the stated objective. A customer-facing statement should also distinguish quoted prices from the amount available at those prices. The ability to execute a particular order depends on conditions at that time; an allocation percentage cannot establish that condition in advance or remove market risk for token holders.
Plan the end of the arrangement
The agreement should define asset return, outstanding obligations, access removal and public communication when the provider changes or the mandate ends. Readers need to understand that an appointed service can be revised or withdrawn under its terms. ALFA's whitepaper promises no fixed redemption, price floor or automatic buyback. A future liquidity policy should preserve that distinction and publish any material change accurately. The mandate becomes useful when it can be evaluated as a defined operating service with accountable resources, rather than a general assurance that a future market will always accommodate every holder's preferred transaction.
