With Solana Automated Market Maker, you can get unstoppable, decentralized, and automated trading using algorithms to price assets in a liquidity pool. When you have traditional exchanges, it needs buyers, a central reservice of assets, and sellers.
On the other hand, Solana Automated Market Maker crowdsources liquidity and works with smart contracts to execute those trades. Still, no matter what AMM exchange you look at, each uses AMM differently to deliver DeFi to the masses.
Still, the general idea remains that crowdsourced liquidity pools replace the order books and the buyers and sellers. Furthermore, the algorithm offers you the same price when you invest in crypto. But why choose Solana AMM?
Why Choose Solana AMM?
For starters, using traditional order books contradicts the idea of using complete decentralization as it works as the mediator listing orders from the buyers and sellers. The problem is that this system can make your traders wait too long, creating many challenges like liquidity issues, low trading volume, and finding matching orders.
So, what is the solution? With the Solana Automated Market Maker, you can facilitate the trading of your digital assets in an automatic mode when using liquidity pools. Hence, the middleman is replaced with a smart contract that provides a variety of crypto tokens into the pools for token exchange to take place immediately.
You Get More Advantages Than Disadvantages
When you facilitate an AAM for your DEX users using Solana, it abolishes the high–fee constraints charging minimal fees providing liquidity to the AMM pools, farming LP tokens, and benefit from harvesting long-term rewards.
It will end the pain points of allocating liquidity in the AMMs as it prevents traders from forking out the money for slippage on a low-liquidity DEX. Compared to your traditional AMM, the Solana Automated Market Maker does not limit your number of tokens to trade or specify the amounts of slippages. With the low gas prices, you solve those limited order issues.
Choose Solan AMM Today
Instead of you waiting for your books to find matching trades, your users can interact directly with the provided liquidity pools with different crypto tokens through Solana. The liquidity pool automatically locks a shared pot of tokens into a smart contract. Traders who want to execute trade can then request tokens without intermediaries, saving lots of money and time.
You get fair prices as the Solana Automated Market Maker (AMM) model does all the mathematics to help determine the cost of your tokens and is not subjected to unfair trades. For you, this is a win-win situation. Thus, your traders can engage in regular trading using liquidity pools without the need to find people willing to trade or even match the desired price.
In turn, it provides fast processing as users need not wait for trade orders, as smart contracts will regulate the whole exchange process with automated trading. The best part is the incentivization for LPs is that they will promote more assets to increase the liquidity in the pool.
For everyone, this is a win-win citation. So what do you think?
Originally posted 2022-12-09 06:32:10.