Curve: the asset-specific automated market maker

Curve launched in January 2020 and is an automated market maker (AMM) decentralized exchange, similar to Uniswap and Balancer. The key insight behind Curve is that, by changing the pricing formula for assets in its liquidity pools, Curve can offer less slippage for trades between assets that are relatively price stable to each other (e.g. stablecoins).

Instead of a traditional order book where buyers and sellers post orders that are executed when prices match, in AMMs, traders and market makers deposit and withdraw assets from liquidity pools. Prices are determined by the amount of assets in a pool and slippage is a function of a trade’s size relative to the amount of assets in a liquidity pool.