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RE: Why I did not like the idea of liquidity pools

in LeoFinance2 years ago

I believe the liquidity pool is a good thing for those who want to help the project, since the liquidity pool stabilizes the token price and makes the token never fall to zero. I believe what you meant by the post is that tokens need to have other sources of income to create buying pressure and not just depend on a pool of liquidity.

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Exactly. Liquidity pool can not prevent the falling of price. If people are using liquidity pool then the price will be stable but it is not. So to stable the price one need to create buy/sell orders that can handle the demand. Or stop placing buy/sell order and only use liquidity pool.