Automated Market Maker (AMM)

Versidium's DEX incorporates an Automated Market Maker (AMM) protocol, which serves as the cornerstone of decentralized liquidity provision and price determination. The AMM algorithm dynamically adjusts token prices based on supply and demand, facilitating continuous liquidity and enabling efficient trading without the need for traditional order books.

• Constant Liquidity: AMM algorithms ensure that liquidity is always available for trading by automatically adjusting token prices according to the ratio of reserves in the liquidity pools.

• No Order Book: Unlike centralized exchanges that rely on order books, the AMM model uses liquidity pools where users trade against the pool's reserves, ensuring immediate execution of trades and minimal price slippage.

• Liquidity Providers (LPs): Users can participate as Liquidity Providers by depositing pairs of tokens into liquidity pools. LPs earn fees generated from trades in proportion to their share of the total pool liquidity, incentivizing them to contribute to the liquidity depth of the platform.