What is a liquidity pool?

Liquidity pools can be optimized for different purposes, and are proving to be an important instrument in the DeFi ecosystem. Automated market makers (AMMs) allow digital assets to be traded without permission and automatically by using liquidity pools instead of a traditional market of buyers and sellers.

What is an AMM liquidity pool?

AMM users supply liquidity pools with crypto tokens, whose prices are determined by a constant mathematical formula. Liquidity pools can be optimized for different purposes, and are proving to be an important instrument in the DeFi ecosystem.

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