SEARCH
You are in browse mode. You must login to use MEMORY

   Log in to start


From course:

Blockchain

» Start this Course
(Practice similar questions for free)
Question:

Decentralized exchanges operating liquidity pools do not allow for arbitrage.

Author: timothy Ntambala



Answer:

False. Arbitrageurs usually keep the exchange ratio a close reflection of current market prices of the underlying assets in liquidity pools. Therefore, arbitrage could be formed when trading between decentralized exchanges and liquidity pools. The DEX of a liquidity pool is simply a platform of liquidity in that scenario and is not aware of the market movements around that exchange.


0 / 5  (0 ratings)

1 answer(s) in total