https://github.com/t8/demand-modulated-markets

SmartWeave contract implementation of demand modulated markets
https://github.com/t8/demand-modulated-markets

Last synced: about 2 months ago
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SmartWeave contract implementation of demand modulated markets

• Host: GitHub
• URL: https://github.com/t8/demand-modulated-markets
• Owner: t8
• Created: 2022-07-05T00:38:31.000Z (over 2 years ago)
• Default Branch: main
• Last Pushed: 2022-08-03T01:52:29.000Z (over 2 years ago)
• Last Synced: 2023-03-03T22:19:27.488Z (almost 2 years ago)
• Language: JavaScript
• Size: 9.77 KB
• Stars: 7
• Watchers: 1
• Forks: 3
• Open Issues: 0
• Metadata Files:
  • Readme: README.md

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README

        
# Demand Modulated Markets

SmartWeave contract implementation of demand modulated markets

This codebase is an experimental implementation of a DMM built into a typical SmartWeave token contract. It is UNAUDITED and majorly UNTESTED, so use at your own risk.

## AMMs vs DMMs

| ![AMM](https://cdn.discordapp.com/attachments/745338028758925317/994659125898260481/unnamed.png) | ![DMM](https://cdn.discordapp.com/attachments/745338028758925317/994659125663375401/unnamed_1.png) |

| :---: | :---: |

| Automated Market Makers (AMMs) operate by algorithmically modifying the buy and sell price of an asset based on the supply of its trading pair in a liquidity pool. | Demand Modulated Markets (DMMs) operate by algorithmically modifying the buy price, sell price, and total supply of an asset based on the demand of the market. |

## Implications

- Token liquidity can scale proportionally and infinitely to demand

- Prevents the need for liquidity providers and eliminates risk of “rug pulls” by withdrawing liquidity

- A “risk profile” can be defined by the curve of the DMM

- Trading liquidity distributed to each asset individually instead of being managed by a single smart contract

## Use cases

- Optimal for fungible and nonfungible tokens that would traditionally be considered illiquid and thus have difficulty trading in an open market

## Contributing

Feel free to submit a pull request or open an issue.