The platform uses an algorithm to determine exchange rates based on the liquidity in the pool.
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Automated market makers (AMM) have changed this game. As no direct counterparty is needed to execute trades, traders can get in and out of positions on token pairs that likely would be highly illiquid on order book exchanges.
When you’re executing a trade on an AMM, you don...
Pooling liquidity is a profoundly simple concept, so it can be used in a number of different ways.
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