which ultimately most of the screenshots are from the above sources. As an academic, I want to say that their publications are well written but I still find it hard to understand because it is not field and I have almost no experience in it. Still, I would like to direct this article to users where I address their problem and straight to the solution without explaining the method. Yes, most of us in public are only interested in how the product will be and care about what is inside the product later.
The Problem With Over Speculation
I only know two use case of volatility which are for uncorrelating an asset and for gambling. Other than that, volatility is generally a problem. A prime example of where volatility is problematic is for medium of exchanges. For example, a meal today costs 40 thousands Satoshis, tomorrow it costs 80 thousands Satoshis, and the next day costs 20 thousands Satoshis. Nobody wants to use something that is up and down as a medium of exchange, everybody wants to use something that is constant or goes up and only in that direction. Volatility discourages new users, new investors, and other newcomers which can slow down or even prevent development and adoption. There is even a publication that mathematically proves that volatility prevents adoption and vice versa where adoption can reduce volatility titled
Volatility Effect on the Adoption and Valuation of Tokenomics.
Those Who Manipulates Price
While in the current financial market there are
greedy bankers and politicians, in the cryptocurrency market there are
whales. How they can manipulate the price is related to the art of monopoly, those who controls the supply controls the price. For example, if Apple is the only smartphone provider, they can set the price as they wish. However, with the presence of Samsung, Microsoft, Lennovo, Xiomi, Huawei, and many other providers, Apple cannot price as they wish as there are other competitors willing to give better offers to the customers. Thus competetion is necessary for the customers' prosperity.
Greedy bankers and politicians and whales can manipulate the price as follow:
Can Speculative AMM Discourage Whales?
While traditional order books determine the price purely on orders, Speculative AMM determine the price based on: