DEX is a decentralized P2P exchange powered by smart contracts. It offers a simple and practical user interface that enables people to easily access financial services.
Automated Market Maker (AMM) is an innovative transaction mechanism that has evolved from the existing order-book-based DEX and changed the cryptocurrency transaction method on-chain. Traders can trade through the liquidity pools created by liquidity providers on behalf of the buy/sell order book, and liquidity providers benefit from the transaction fees generated by the liquidity pool as revenue based on their liquidity contribution.
Delioswap's AMM mechanism is based on the formula x*y=k, and when a liquidity pool is created, the price of the corresponding token is formed according to the quantity of each token. For example, if the liquidity supply of x increases, the quantity of y decreases in exchange to maintain the constant k. In this way, the supply quantity for each token in the liquidity pool changes, and the price is designed to automatically form.
When anyone adds tokens to the desired liquidity pool, they are called a Liquidity Provider (LP). If you provide liquidity to the pool, you receive LP (Liquidity Pool) tokens as proof, and the number of received LP tokens indicates your stake (%) in the entire pool. Based on this LP, you can receive commission income from the pool as liquidity supply compensation.
Farming the LP token received as a liquidity supply reward will also reward you with DSP tokens and staking tokens will reward you with extra DSP tokens or other cryptocurrencies.