"Liquidity pools, in essence, are pools of tokens that are locked in a smart contract. They are used to facilitate trading by providing liquidity and are extensively used by some of the decentralized exchanges a.k.a DEXes. One of the first projects that introduced liquidity pools was Bancor, but they became widely popularised by Uniswap. Curve realized that the automated market-making mechanism behind Uniswap doesn't work very well for assets that should have a very similar price, such as stable coins or different flavors of the same coin, like wETH and sETH. Curve pools, by implementing a slightly different algorithm, are able to offer lower fees and lower slippage when exchanging these tokens. The other idea for different liquidity pools came from Balancer that realized that we don't have to limit ourselves to having only 2 assets in a pool and in fact Balancer allows for as many as 8 tokens in a single liquidity pool." -Finematics
We do not own the video posted in this category. All videos are borrowed and used only for educational purposes. We would like to give credit to the video content creator who shared and popularized the video content. Any opinions expressed in this material do not necessarily represent the views and opinions of Bitkub Online. NO COPYRIGHT INFRINGEMENT INTENDED.