DeFi Liquidity: How Trades Find the Other Side
Start with the participants
DeFi connects financial activities such as transactions with on-chain programs. When studying trading scenarios, you can first identify the respective roles of traders, liquidity providers, and protocols.
Read along the asset path
Select a specific exchange scenario and record where the assets come in, how the exchange is completed, and how the results are presented. Then refer to the agreement description to sort out the conditions that affect the quotation and transaction, and avoid looking at only a single display number.