Decentralized exchange protocol Kyber Network has launched a dynamic market-making (DMM) protocol, which it says is designed to be more capital efficient than its automated market-making (AMM) protocol.
Kyber DMM is also expected to optimize fees and maximize earnings for liquidity providers, Kyber Network announced Monday. That is because of the DMM’s two new features — „dynamic fees” and „programmable pricing curve.”
With the programmable pricing curve, Kyber DMM allows a liquidity provider to customize the price curve for any token pair with a „specific amplification factor (AMP),” Kyber Network CTO Victor Tran told The Block.
„This AMP will virtually amplify the token balance in the pool whenever tokens are added,” said Tran. „This means that given the same liquidity pool and trade size, Kyber DMM can provide much better liquidity and slippage compared to AMMs.”
Slippage can potentially be „100X better” than AMMs for more stable pairs (e.g., USDT/USDC), Tran told The Block. S
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