Before the upgrade, Lyra’s market maker vaults (MMV) paid swapping fees for every collateralization and hedging trade. For example, when a trader buys a call option contract on ether (ETH), Lyra’s MMVs would purchase ether from a spot exchange, incurring a fee. Once the trader’s position has closed, Lyra’s MMVs would sell back the ETH used for collateral, incurring yet another fee.
Source: https://www.coindesk.com/tech/2023/02/03/options-automated-market-maker-lyra-deploys-to-arbitrum-network/?utm_medium=referral&utm_source=rss&utm_campaign=headlines