Solving Constant Product for price

The constant product is used in decentralized finance. It is used to calculate how much someone gets for currency $Y$ when giving funds of currency $X$. $X$ and $Y$ indicate the size of funds in the corresponding currencies, $z$ stands for the amount of funds of currency $X$ given into the pool, $a$ stands for the amount of funds received in currency $Y$. $p$ is the price paid for the transaction.

$k = X * Y$
$a = Y - k / (X + z)$
$p = z / a$

Now my question is: How much does someone have to give to exactly receive $p$?

$X = 100, Y_1 = 50, Y_2 = 50, z = 10$
$k = 100 *(50+50)$
$a = (50+50) - 10000 / (100+10) = 9.09...$
$p = 9.09... / 10 = 1.09...$

  • Mathe Mathe

    When you say, "How much does someone have to give?" you mean "z", right?


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Mathe Mathe
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