Permissionless Liquidity Pool Creation

Overview

Liquidity pools are pools of funds that are locked into a smart contract on a decentralized exchange (DEX). These funds are used to facilitate trades between different assets, without the need for an intermediary.

Learn more about Liquidity Pools here.

Anyone can create liquidity pools for markets permissionlessly on Demex.

Demex is a hybrid DEX that employs an automated market maker (AMM) and a Central Limit Order Book (CLOB). In order to enable trading, liquidity pools must be linked to their corresponding spot markets. On Demex, a liquidity pool is automatically linked to its corresponding spot market upon creation.

Step-by-Step Guide

Creating a new pool on Demex is simple. Follow the steps outlined below.

Step 1: To get to the 'Create New Pool' feature, go to the Pools page on Demex and select the 'Create New Pool' option.

Step 2: Select the two assets that you want to create a Liquidity Pool for.

Step 3: Set pool weightage.

Example For a 80% ETH / 20% SWTH liquidity pool, 80% of the total value locked in the liquidity pool is represented by ETH, while the remaining 20% is represented by SWTH. This ratio determines the price of each token in the pool, which is adjusted as trades are made.

Learn more about Unequal Pool Weights here.

Step 4: Deposit a proportionate value of both assets into the Liquidity Pool according to the pool weightage.

Step 5: Choose an amplification factor.

Learn more about Amplified Pools here.

Step 6: Ensure that the details shown match your desired Liquidity Pool information, then click on the 'Create' button.

Step 7: Liquidity Pool successfully created!

That's it! Your token has been permissionlessly imported. You can now make a deposit using this token and create a market for it.