Without any orders on the books, how does a DEX quote prices?
AMM prices are determined solely by the ratio of the two tokens in the liquidity pool. When they diverge from the external market price, arbitrage trades bring the quoted price back toward the external price.
Practical knowledge may seem boring most of the time, but when things go wrong, you realize how valuable it is.
Understand the principles before taking action. Don’t place orders on impulse.
$UNI 6.963（-7.16%）
#UNI
AMM prices are determined solely by the ratio of the two tokens in the liquidity pool. When they diverge from the external market price, arbitrage trades bring the quoted price back toward the external price.
Practical knowledge may seem boring most of the time, but when things go wrong, you realize how valuable it is.
Understand the principles before taking action. Don’t place orders on impulse.
$UNI 6.963（-7.16%）
#UNI