Great vid. I suggest running at 1.5x speed still very comprehendible.
@SamJones13373 жыл бұрын
its great and i ran it at 2x
@davem36733 жыл бұрын
Good tip
@abuturki44603 жыл бұрын
I just learned about this feature in KZbin from you.
@thepurpleflute97403 жыл бұрын
Good call I appreciate it!
@qichang4485 Жыл бұрын
I've learnt from tons of tutorials about AMM. This one apparently the best. Crystal clear! Thanks sir.
@santiagodevrel Жыл бұрын
This video is gold, thanks man!
@0xkerman Жыл бұрын
Glad it helped!
@markmaximus1002 жыл бұрын
This is the best explanation of the math behind AMMs hands down!
@nikitabobyshew79273 жыл бұрын
Best explanation I've found. Very clear. Thank you
@adamsasso14 жыл бұрын
Nice explanation. I’d like to offer a slight correction in some of the phrasing you used - it might help keep things clear and understandable in the future... When talking about the ‘Buy’ order you refer to the price first, then the amount. For example: “Alice would pay $100 for 1 ETH.” Conversely, on the “Sell” side you’d say: “Bob offers 1 ETH at $100.” The key being the order (price, then amount) or (amount, then price) and the words “for” and “at”. This way there’s no confusion about what side each party is on and what they want to do. I worked on a trading desk for years and this is how we kept things straight. Also, the Buy side is generally written on the left, and the Sell side on the right.
@rusydiumar66963 жыл бұрын
cool
@thepurpleflute97403 жыл бұрын
Consistency matters, fair enough. :)
@Joshh.K3 жыл бұрын
i was dying for a visual understanding of what i would be doing if i staked a coin, in exactly the format you've provided. thank you mate, proper hit the spot!
@sander729914 жыл бұрын
Loving the format of this video. Great job 👏
@maxholloway47883 жыл бұрын
Hey, overall great video but the traditional order book explanation is a bit off. The order book graphic is a histogram of bids (green) and asks (red); on the x-axis are the prices, and on the y-axis are quantities.
@sommi8884 жыл бұрын
🧡💛💚💙 You handwriting is epic and the colours are nicely chosen 🧡💛💚💙
@tan.nicolas3 жыл бұрын
What a good teacher you are!
@radicalexile4 жыл бұрын
Awesome content. Such a great way of explaining the concept.
@rushiljohar42064 жыл бұрын
Most Required Video. Wazirx Exchange India just went AMM. thanks dude! 🇮🇳🙏
@ignatiuse68573 жыл бұрын
This was an awesome explanation! Thank you ... last thing I would love to know is what the relationship is between slow/expensive smart contracts and why this makes traditional order books unfeasible
@pengjoon3 жыл бұрын
Love the explanation 🔥
@laurenzhasselbach82313 жыл бұрын
Best AMM Explanation Video! Only one detail I did not quite understand. Why is an Order Book unsuitable as a Smartcontract and suitable for the AMM. Is it because the Smartcontract offer would have to be written on the block chain every time? Whereas the AAM only has to read from the block chain, so the prices are live? Nevertheless, a calculation has to be made and computing power costs in the Ethereum network. As I said, I didn't quite understand it yet :D.
@maxholloway47883 жыл бұрын
Hi Laurenz! Decentralized apps rely on smart contracts on the blockchain, and that blockchain is the single source of truth for everyone using the network. Market makers on centralized exchanges (e.g. the New York Stock Exchange) place limit orders to buy or sell an asset at particular prices. For example, they might offer to buy Apple shares at $122 and also offer to sell Apple shares at $123. But since price is relatively volatile, for both stocks and crypto, the market maker often times needs to cancel their orders. For example if the market maker thinks the price of Apple stock will go up to $130, she might want to cancel her offer to sell Apple at $123. In centralized exchanges this is not an issue, since they just use the exchange's internal servers to cancel the order. However on decentralized exchanges, cancelling an order might cost a couple dollars. Typical market makers on centralized exchanges can place hundreds or thousands of orders per day, and make cents on each transaction, and also cancel a lot of orders. They would lose a ton of money if they did it all on the blockchain, making it harder for order-book style exchanges to exist on the blockchain. Hope this helps!
@TheRollupCo2 жыл бұрын
Simply amazing! Well done, very like your explanation.
@yoeydanjuma3 жыл бұрын
great content absolutely love the old school black board style
@valeriobraconcini-phipps94182 жыл бұрын
Hi can you explain further why the curve is exponential and not linear
@vrcmacki27013 жыл бұрын
Great explanation, thank you!
@GermanMazzaferro3 жыл бұрын
Excellent explanation!!
@joeysang773 жыл бұрын
You nailed it! Very impressive. Thank you!
@JayTrinidad3 жыл бұрын
That was amazing! Mind blown 🤯
@Benmansouri2 жыл бұрын
I hope you make a video about hybrid AMM/orderbook
@majedti41263 жыл бұрын
can you do a vid on impermanent loss?
@jejunegamingtv13592 жыл бұрын
is it me or is the explanation wrong? You want to give ETH to the pool but you deduct 1 from the pool -> 10 - 1? Or am I missing something? Shouldn't it be 10 + 1 and for the DAI, it should be 1000 + x?
@SilasAram10 ай бұрын
So basically an AMM is an Automatic Currency Exchange System or AI Bank. So can you create a AI Bot using AMM Engineering to be gather Data for other things like Email Marketing?
@elijahbrown45942 жыл бұрын
Thanks!! Very helpful!!
@brookngamotu26393 жыл бұрын
Change speed of video to 1.75x
@GregJohns4 жыл бұрын
Awesome explainer
@iamritambhar3 жыл бұрын
One of the best explanations of AMM, but I had to watch it at 1.5X speed 😁
@funnymuny71273 жыл бұрын
your awesome thank you
@ethanluc89083 жыл бұрын
at 13:17, should that be 111 DAI (which is $111 since DAI = $1)?
@jf7sm533 жыл бұрын
yes, in that example we take 1 eth and give 111DAI. This mention of 111$ is super confusing. At that point in video I had to stop and look up somewhere else to sort this out. This is an example of how you can tell any bullshit in calm and confident voice and majority of people won't notice lol. Makes me think if people who comment "awesome" and "nice one" actually watched the same video I did.
@catchacard46382 жыл бұрын
great, loopring does this
@erickjian70253 жыл бұрын
before 11:34, you mentioned somebody wants to buy ETH (from the pool). I'm confused at 11:34 How are they giving ETH to the pool ?
@brownmiester2 жыл бұрын
i think he mis spoke
@varunkao49873 жыл бұрын
[8:51] Perhaps I missed this, but I have to ask, how is ratio in the contract determined?
@HaiHoang-dd8co3 жыл бұрын
Beautiful explain, can you share the app you use to do this? Many thanks
@princedavid884 жыл бұрын
Great video.
@funnymanallinsanw96062 жыл бұрын
But what happens if eth price increases else where? Will it also increase in the AMM by the same amount because there will be more demand on the AMM as well? And what guarantees that the increase in price of eth on the AMM will be the same as the increase elsewhere?
@mohammadr.zeinali47083 жыл бұрын
That was awesome
@tahirasiddiqui65654 жыл бұрын
Great content 👍👍
@cammylee5913 жыл бұрын
nice one bro
@sudeep.g3 жыл бұрын
Thank you so much! Great explaination
@AX1A3 жыл бұрын
Thanks, you’re the best
@nicolasweiss61863 жыл бұрын
Hi, thanks for the great video! For red-green orderbook diagram (/histogram), shouldn't the price be the x-axis and volume be the y-axis instead?
@maxx76943 жыл бұрын
Lol yeah it doesn't look right to me either. As the price increases the cumulative sell orders should be increasing as well, not decreasing.
@jonwu45293 жыл бұрын
Actually I m a little confused in this model, X x Y = K, is that means when one man sells 1 eth and use AMM, the price of eth will go up?
@Channel602 жыл бұрын
How does one find these AMM arbitrage opportunities consistently?
@omparikh44263 жыл бұрын
does k change when market makers provide equal quantity of both x and y?
@user-xy8cq5oi9f3 жыл бұрын
At 18:05 you said "I just have to give two quantities of tokens to the smart contract and I become a market maker/provide liquidity" What do you mean? - this part has no context. Is this separate from the buyer and seller? Please explain.
@onekycarscanners60023 жыл бұрын
You have to stake the two tokens if not you are just a buyer and seller or a burrower and lender.
@user-gs7uu6ig7o3 жыл бұрын
But who is the arbitrageur? On something like Pancake Swap, or any AMM, I see the option for providing liquidity or as you would say being a "market Maker". In return a LP gets a good APR. And then there are pools where you can yield farm. What do the pools contribute to formula? Those are basically all the options I see. So the arbitrage is where?
@onekycarscanners60023 жыл бұрын
Any one can arb just look at the price difference or set a bot to do it. Arbs = risk free traders.
@gsuarezduek3 жыл бұрын
amazing, thx!
@sebastianojeda52833 жыл бұрын
Gold
@galvinng19973 жыл бұрын
You say the price of Dai is x/y = 0.01. But Dai is $1, not 1 cent...?
@cryptohype42944 жыл бұрын
Please keep it up-
@mspacey4 жыл бұрын
so AMM is the entity doing the arb? if so the smart contract could almost use any math and AMM will arb it back right? the math doesnt have to be x*y = k; it could be anything like x*2y=k; and it wouldnt matter. As long as arbitrageurs bring it back.
@asandrius863 жыл бұрын
thanks but if you want to buy ETH, don’t you reduce the amount of ETH and not sum?
@jejunegamingtv13592 жыл бұрын
that was what i was thinking as well.
@brownmiester2 жыл бұрын
wait price of dai is .01? at 10:53?
@fortunatluethi4 жыл бұрын
ove this, what platform did you use explaning this?
@mrmohamed54944 жыл бұрын
notability
@sehz17894 жыл бұрын
Does anybody know who started this whole AMM model ? i dont think it was uniswap that was the first.
@DewaldVDB4 жыл бұрын
Would be nice to know yeah
@maxx76943 жыл бұрын
I'm not sure about the implementation but I believe it was first described as a possibility for Ethereum in a paper by Vitalik.
@sehz17893 жыл бұрын
@@maxx7694 i think youre right . and bancor was the first to implement i think
@Kompot013 жыл бұрын
I do not get from where do they got first numbers x and y.
@onekycarscanners60023 жыл бұрын
The first Lp should provides it.
@mccorrect34702 жыл бұрын
So he paid $111 for something that costs $100 because the pool has to rebalance?
@jonnymorley13443 жыл бұрын
some errors but good to get the gist
@financialgyaan96563 жыл бұрын
No new video coming? 🥺
@rusydiumar66963 жыл бұрын
DAI Price 1 1USD, but a minute later you said DAI Price = 10/1000 = 0.1 USD. Cool..... How come....
@sudeepjc3 жыл бұрын
It's 0.1 ETH, it always works in pair. ETH vs DAI
@noirimsi3 жыл бұрын
so, defi dex pools are scam? xd
@whatthefunction91404 жыл бұрын
So be careful swapping a small pools kids.
@rushiljohar42064 жыл бұрын
Just reduce the sell price and increase the buy price in smart contact.. no need to do soo much math.
@bereketmol42273 жыл бұрын
You lost me 5 times
@ddljddlj7043 жыл бұрын
Lol same
@philhellmuff4 жыл бұрын
Great video but it could have been 10 min shorter if you had just used slides.