Economics Design

EP 19: Token Bonding Curve Algorithms for Autonomous Market Makers (DEX)

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The podcast version has no images to follow, unlike the YouTube channel. So it's easier! 🥳 

In Part 1, we covered the basics of token bonding curves and understand how the shape of the curve affects the incentive mechanism.

In this episode, we look into the application of token bonding curve in decentralised exchanges, DEX. Specifically, the use case of Autonomous Market Maker.

We dive into 4 case studies: Bancor, Uniswap, Balancer, Curve

The concept of token bonding curve in this 4 DEXes are the same. But the application of how the token bonding curve algorithm is built is different. So we uncover the 4 various algorithms used in the 4 different token bonding curves.

Quick navigation:

  • Addressing 3 issues of previous episode: 00:26
  • Content we will be covering: 05:40
  • SUMS of token functions: 07:11
  • TBC in Stable tokens (pegged tokens): 09:17
  • TBC in Security and Utility tokens: 10:35
  • TBC in Autonomous Market Maker (AMM): 11:42
  • Why AMM in Decentralised Exchanges (DEX): 14:39
  • Which DEX that use AMM: 17:03
  • Math concepts of Bonding Curve in Autonomous Market Maker : 18:13
  • General bonding curve in AMM: 23:03
  • Case study 1, Bancor: 26:41
  • Case study 2, Uniswap: 34:25
  • Case study 3, Balancer: 40:18
  • Case study 4, Curve: 46:29
  • Application to projects: 50:07

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    Economics DesignBy Lisa JY Tan
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