PRICE RELEASE According to Hoo users who participated in AMM (Automated Market Maker) test, each liquidity pool of Hoo has listed quantitative data, such as total liquidity, 24H transaction fee, 1 day and 7 days annualized return for users’ reference. Users can access the Hoo website to obtain liquidity, unlike on-chain DEX such as Uniswap. The operation takes place faster than other DEX, without the need for Gas fees.
Hoo is currently offering trading pairs such as BTC/USDT or ETH/USDT. The exchange plans to add trading pairs as market demand dictates, add coin rewards and VIP rights for Hoo.
Hoo AMM Pool offers users a commission of fees
Hoo Exchange recently added AMM Pool functionality after an update. It’s known that AMM Pool is in the grey test phase. However, regular users have the opportunity to try the situation and reap the benefits.
AMM (Automated Market Maker Method) was long ago a common concept for DeFi players. It is now more widely used by DEXs, such as Uniswap, SushiSwap, and SushiSwap. This mechanism supports all market users in providing liquidity for trading pairs of asset, which ultimately creates a liquidity-rich liquiditypool where asset prices vary according to the relative value of the two assets. The liquidity provider then splits the transaction fees.
Hoo’s AMM pool is the equivalent of the CEX evolution model of the Uniswap AMM scheme. Hoo, who had discovered CeFi during the DeFi craze in 2020 and started exchanges and mining boards such HooSwap (and HooPool) back then. According to the introduction, Hoo AMM pool is considered an iteration on top of HooSwap, except that the liquidity in the pool will be provided to multiple mainstream trading pairs in Hoo’s coin trading area.
Some participants in the gray testing said Hoo APP is capable of finding liquidity. There is a “liquidity pool” button in the top right corner of the Hoo Cryptocurrency trading page, after clicking into it you can inject the corresponding two assets for BTC/USDT and other trading pairs, and then the pool will automatically make a market and issue daily rewards according to the ratio of liquidity funds provided by the user to the total pool.
Page of Hoo Liquidity Pool
Let’s take BTC/USDT as an illustration. You can deposit USDT or BTC assets according to the current BTC price. Once the liquidity is added, it will automatically be moved to the BTC/USDT Trading pair at the Hoo spot trading zone. Whenever investors make a transaction, those involved can split the fee share.
The rules allow users to receive daily liquidity reward payments. Due to rapid liquidity out and in, the price of the coin may fluctuate for a brief period. To avoid this risk and better manage reward distribution and calculation, the rules allow users to receive their rewards on a daily basis. Hoo established some terms and conditions for the redemption of AMM liquidity pool tokens. Users must provide liquidity in order to redeem AMM liquidity pools within one hour. Only full redemptions will be supported. One redemption is allowed per pool for 24 hours.
In accordance with test participants, on the liquidity pool page, each pool provides some visual quantitative data for users’ reference. These include total liquidity, 24-hour transaction fees, annualized daily yield, annualized 7-day yield, and annualized day yield. This page allows users to check their liquidity status and the percentage of their offers. Redeeming your offer is easy as well. Click the redeem button to withdraw liquidity or dividend rewards. In about three minutes, the assets are transferred automatically to your wallet.
How to reduce AMM cost while ensuring security
Participants suggested that Hoo liquidity pool has greater significance if there is more security.
Although the on-chain ecosystem has been growing rapidly over the last few years, security concerns have not diminished. If users aren’t careful they could face severe loss. This includes technical flaws in smart contracts and backdoors that project parties leave. Hacker attacks on coins can also occur from time to other. But now users give a positive comment that all of the user’s operations are within the Hoo site that is a centralized trading exchange, which is equivalent to being done in a controlled space. High security is possible for users.
Hoo stated that almost zero percent of Hoo liquidity pool security incidents could occur. The Hoo AMM liquidity pool, added to the spot module of the chain, is almost 0.
It is important to understand that users will experience impermanent losses regardless of whether they offer liquidity on a DEX, such as Uniswap, or make a market at Hoo for a pair of trading pairs. For example, in the BTC/USDT pair, as the BTC price falls, liquidity providers will experience an increase in BTC, and a decrease in USDT. This can cause funds to wear. Although a centralized exchange can be more convenient, users are able to withdraw assets in the event of market volatility. This allows for them to prevent large and unpredictable losses.
Some insiders believe the AMM pool’s opening is another exploration of CeFi. It is also a benefit for users and is relevant to Web3’s spiritual core. In this feature, users’ idle assets can be put into the pool to earn income, and exchanges get more abundant liquidity, forming a win-win situation.”
Hoo AMM pools will likely be completely opened. And more users can experience the role of “Hoo shareholder”. One person in the loop thinks this model, which allows users to build exchanges and rewards them for it, may soon become popular.
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