Liquidity Pool

In Hyperswap, a liquidity pool is a smart contract that holds two different assets and enables users to swap between them instantly, without relying on traditional order books.

Our Automated Market Maker (AMM) ensures that trades can occur at any time, provided there is sufficient liquidity.

Each liquidity pool is composed of two tokens, and the relative price between these tokens is determined automatically by the pool’s reserves according to specific mathematical formulas.

Liquidity providers (LPs) deposit equal values of both tokens into a pool, and in return, they earn a share of the fees generated from trades within that pool.

Hyperswap supports two types of liquidity provisioning:

• Amm Standard Liquidity Position: Based on the Uniswap V2 model, liquidity is distributed across the entire price curve.

• Concentrated Liquidity Position: Based on the Uniswap V3 model, liquidity providers can define custom price ranges for their liquidity, maximizing capital efficiency.