Token Pair

A Token Pair is the fundamental unit of a liquidity pool, consisting of two different assets that are traded against each other. The relationship between these two tokens defines the exchange rate and the dynamics of the pool.

In most decentralized exchanges, users must deposit an equal value of both tokens to provide liquidity. The choice of token pairs is critical for the success of a pool, as it determines the potential for trading volume and the risks associated with price divergence.

Managing these pairs requires an understanding of asset correlation and market demand.