What is AMM?
Last reviewed 2026-05-03
Used by: PancakeSwap AMM, DODO AMM, PancakeSwap AMM V3
Entity coverage: 7 protocols, 0 tokens, 0 chains reference this concept.
First defined in: Uniswap v3 Core (2021) by Hayden Adams et al.
An automated market maker is a smart-contract-based exchange that prices assets via a deterministic formula instead of an order book. Liquidity providers deposit token pairs into pools and earn a share of swap fees.
Uniswap v2 popularized the constant-product (x*y=k) AMM in 2020. Variants include Curve's StableSwap (low-slippage between like-priced assets) and Uniswap v3's concentrated liquidity (CLMM).
How it works
An automated market maker is a smart-contract-based exchange that prices assets via a deterministic formula instead of an order book. Liquidity providers deposit token pairs into pools and earn a share of swap fees.
Uniswap v2 popularized the constant-product (x*y=k) AMM in 2020. Variants include Curve's StableSwap (low-slippage between like-priced assets) and Uniswap v3's concentrated liquidity (CLMM).
For deeper protocol-level mechanics, see the related glossary terms below or the linked DeFi Intel topic deep-dive.
Why it matters
AMMs are the core innovation that made on-chain trading viable. They eliminate the need for off-chain matching engines and central market makers.
Real-world examples
Uniswap (CPMM v2, CLMM v3, hooks v4), Curve (StableSwap), Balancer (weighted pools), Aerodrome, Trader Joe (Liquidity Book).
Related terms
- Liquidity Pool
- CPMM (Constant Product Market Maker)
- CLMM (Concentrated Liquidity Market Maker)
- Impermanent Loss (IL)
- Uniswap
Go deeper
Read the full DeFi Intel topic deep-dive or browse the complete crypto glossary.
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