GooseFX
  • 🟣Welcome to GooseFX
  • 🔍Risks & Disclaimer
  • GAMMA
    • GAMMA
      • Learn about AMMs
      • Dynamic Fees
      • Fusion
      • Boosted Rewards
      • Program Instructions
      • FAQs
      • Risks
      • GAMMA Audit
    • GAMMA for LPs
      • How to Provide Liquidity
      • How to Add Liquidity
      • How to Withdraw Liquidity
      • How to Claim yield
      • FAQs - for LPs
    • GAMMA for Pool Creators
      • How to Create a New Pool
      • FAQs for Pool Creators
    • GAMMA Partner Program
  • Tokenomics
    • 📊GOFX Token
    • 💸Stake Rewards & Fee Share
  • Platform Tutorials
    • 🪙How to Stake/Unstake GOFX
    • 🌎Geo Restricted
  • 🫂Community
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  1. GAMMA
  2. GAMMA

Learn about AMMs

  • What is an AMM? An Automated Market Maker (AMM) is a decentralized exchange mechanism where users trade against liquidity pools instead of traditional order books. AMMs maintain a balance between the tokens in a pool using mathematical formulas (x * y = k) to enable swaps

  • What is Idle Capital? Idle capital refers to unused liquidity sitting in pools that isn't actively utilized in trades. For example, in a SOL-USDC pool during an uptrend, most trades may involve swapping USDC for SOL, leaving a large portion of USDC untouched.

  • Liquidity Provider (LP) Users who deposit tokens into AMM pools to enable trading and earn fees.

  • Dynamic Fees A mechanism where fees is adjusted based on pool activity and volatility, benefiting LPs during market volatility.

  • Capital Efficiency Maximizing the utility and yield of deposited funds in a pool.

  • Total Value Locked (TVL) The total amount of funds locked in an AMM’s liquidity pools, representing the scale of liquidity available for trading.

  • Slippage The difference between the expected price of a trade and the actual price due to insufficient liquidity or high trade size.

  • Impermanent Loss (IL) A temporary loss in value experienced by LPs when the price of tokens in a pool changes significantly compared to when they were deposited.

  • Liquidity Pool (LP) A pool of two tokens that enables trading on an AMM by maintaining a balance according to a constant product formula.

  • External Protocols Platforms outside of GooseFX, such as lending or borrowing protocols, where Fusion deploys idle capital to earn additional yield.

  • Dynamic Rebalancing The process of adjusting deployed liquidity based on pool needs and market conditions to maintain optimal performance.

  • Permissionless Pools Liquidity pools that can be created by anyone without approval, allowing a wide range of token pairs to trade on the AMM.

Last updated 4 months ago

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