From 25e69d5484ed1ba4e1403757ed939d7bc33d12f9 Mon Sep 17 00:00:00 2001 From: ddawson Date: Thu, 15 Dec 2022 11:33:07 -0800 Subject: [PATCH] Add info to AMM use case. --- content/use-cases/defi/amm-uc.md | 15 ++++++++++++--- 1 file changed, 12 insertions(+), 3 deletions(-) diff --git a/content/use-cases/defi/amm-uc.md b/content/use-cases/defi/amm-uc.md index 5bd1f91f87..fd9e400078 100644 --- a/content/use-cases/defi/amm-uc.md +++ b/content/use-cases/defi/amm-uc.md @@ -1,10 +1,19 @@ --- html: amm-uc.html parent: defi-uc.html -blurb: Exchange . +blurb: Use an Automated Market Maker to facilitate currency exchange. labels: - - Transactions + - Decentralized Exchange + - AMM --- # Automated Market Maker -The Automated Market Maker (AMM)... \ No newline at end of file +An automated market maker (AMM) is a protocol for the Decentralized Exchange (DEX) that prices assets through an algorithm, rather than using an order book like a traditional exchange. + +AMMs allow you to trade at a certain exchange rate on a DEX without having to find a counterparty. Instead of having to find a neighbor who is willing to trade USD for Euro, or go to the airport currency exchange counter, the AMM allows you to exchange tokens freely. + +AMMs allow people to trade tokens peer-to-peer through liquidity pools, which are token reserves secured by a smart contract. The more tokens available to trade, the lower the exchange fee to swap between the tokens. + +To learn more about AMMs, see [AMM](amm.html). + +