Stop Loss Orders
Stop Loss orders are oracle-based conditional orders that automatically trigger when asset prices fall below a specified threshold, providing automated risk management through Chainlink-compatible price feeds.
Core Mechanism
The system monitors price ratios between two tokens. When the calculated exchange rate reaches or falls below the strike price, the order becomes executable:
(sellTokenPrice / buyTokenPrice) <= strike
Essential Data Structure
| Parameter | Description |
|---|
sellToken / buyToken | Token pair addresses |
sellAmount / buyAmount | Trade amounts based on order type |
sellTokenPriceOracle | Chainlink-compatible price oracle for sell token |
buyTokenPriceOracle | Chainlink-compatible price oracle for buy token |
strike | Exchange rate threshold (18 decimals) that activates execution |
validTo | Expiration timestamp |
maxTimeSinceLastOracleUpdate | Staleness limit for oracle data |
Critical Oracle Requirements
Both oracles must use identical quote currencies. Price feeds undergo validation checks for:
- Positivity
- Freshness within the specified time window
- Decimal normalization to 18 decimals
Order Execution Flow
The contract performs sequential validation:
- Confirms order hasn’t expired
- Retrieves current oracle prices
- Validates both prices exceed zero
- Checks oracle data freshness
- Normalizes prices to 18 decimals
- Compares current rate against strike
- Returns executable
GPv2Order if all conditions pass
Practical Examples
- Protecting GNO positions at $200
- Selling up to 50 ETH with partial fills at $2000
- Cross-asset trading (WBTC for ETH at 15:1 ratio)
Each demonstrates different parameter configurations for real-world scenarios.
Stop loss orders provide one-time protection. After execution, you’ll need to create a new order for continued protection.
