I am a backend developer and in the recent few weeks, I had been drippings my feet into the web3 space. I found out about DEXs Digging through I kinda understand the technical sides of things, however I am confused as to how Liquidity pools of DEX work.
I read about AMM and all that stuff about how tokens are swapped, but I fail to understand how does the staking work in a Liquidity pool? Like the LP tokens received upon staking basically shows how much % a person has in a pool?
What can these LP tokens used for other than % stake?
They can be traded like other Ethereum based tokens?
Also what would happen if a real large swap happens?
Like all the tokens in a pool gets swapped and the pool becomes empty, how would I staking and stuff work then?
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