Day 95/100 : Exploring DeFi with the “Constant Sum AMM”
#100DaysOfSolidity 095 DeFi : “Constant Sum AMM”
Welcome to Day 95 of the #100DaysOfSolidity series!
Today, we’re going to dive deep into DeFi (Decentralized Finance) by exploring the fascinating world of Constant Sum Automated Market Makers (AMMs). 🚀
Introduction to DeFi and AMMs
DeFi has taken the blockchain world by storm, revolutionizing the way we think about finance. It aims to recreate traditional financial systems with decentralized technologies. One of the key innovations within DeFi is Automated Market Makers (AMMs), which have played a pivotal role in the growth of decentralized exchanges (DEXs).
What Are AMMs?
AMMs are smart contracts that facilitate the exchange of tokens on a blockchain. They provide liquidity and determine the price of assets within a given trading pair. Unlike traditional order book-based exchanges, AMMs use mathematical formulas to calculate prices and execute trades.