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Basics

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What is AMM?

AMM stands for Automated Market Maker. It is a decentralized exchange (DEX) protocol that uses liquidity pools instead of order books to facilitate token trades. In AMM, users are called liquidity providers, and they deposit tokens into liquidity pools, allowing traders to trade directly with these pools.

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Pricing Algorithm Calculation

To minimize slippage across all liquidity pools, AMM platforms utilize a pricing algorithm. The most prevalent formula is x * y = k, where:

  • X is the amount of an asset in a liquidity pool
  • Y is the amount of the second asset in the same pool
  • K is the total amount of liquidity on offer, typically a fixed figure

While this formula is the most widely used, other AMMs, such as Curve and Balancer, employ a more complex algorithm. Ultimately, the primary objective of the pricing algorithm is to determine a stable price for each asset in the liquidity pool using a smart contract algorithm.

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Swapping Tokens on ONTON Finance

To swap tokens on ONTON Finance, follow these steps:

  1. Connect to ONTON Finance using your TON wallet.
  2. Select the token pair you want to swap, such as USDT to ONTON.
  3. Enter the amount you want to swap.
  4. Check the swap details, including the exchange rate, slippage tolerance, and transaction fees.
  5. If you are satisfied with the details, confirm the transaction.
  6. After the transaction is complete, the swapped tokens will be deposited into your wallet.

By leveraging the advantages of the TON blockchain, ONTON Finance provides a high-efficiency, low-cost token swapping method. Enjoy tight spreads and smooth trading experiences while receiving ONTON tokens as a trading fee discount.

Swapping TokensONTON Fee Structure