# Automated Market Maker (AMM) The Automated Market Maker (AMM) in Velar Dharma is inspired by Uniswap V2 and facilitates decentralized token swapping and liquidity provision. It utilizes the constant product formula (x\*y=k) to determine the pricing of assets within the liquidity pools. Users can seamlessly swap between different token pairs without the need for traditional order books. Liquidity providers can contribute their tokens to the AMM pools and earn trading fees in return. This incentivizes users to supply liquidity, ensuring a healthy and active trading environment. The AMM smart contracts are designed to be secure, efficient, and easy to integrate with other DeFi applications. #### AMM Contract Addresses: \- Factory Contract: SP1Y5YSTAHZ88XYK1VPDH24GY0HPX5J4JECTMY4A1 \- Router Contract: SP1Y5YSTAHZ88XYK1VPDH24GY0HPX5J4JECTMY4A1.univ2-router --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://docs.velar.com/velar/velar-versions/velar-dharma/automated-market-maker-amm.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.