Pact’s vision is to be the Home of Liquidity on Algorand.
What is Pact?
Pact is a specialist Automated Market Maker (AMM) on Algorand. Powered by its decentralized, secure and scalable blockchain. Pact offers the most user-friendly, low cost and lightning-fast experience in Decentralised Finance (DeFi). Through continuous innovation, Pact is focused on delivering the best experience and efficiency for traders and liquidity providers.
To begin, we should clarify the composition of "Pact":
Pact: The team of core contributors that develops and maintains the Pact protocol and user interface.
Pact Protocol: A suite of immutable smart contracts that form an Automated Market Maker (AMM) that facilitates peer-to-contract liquidity provision and swapping of tokens on the Algorand blockchain.
Pact User Interface (UI): The official web-based user interface that makes it easy for users to interact with the protocol. The user interface is one of the many ways users can interact with the protocol.
What is an Automated Market Maker (AMM)?
You could think of an Automated Market Maker (AMM) as a robot always willing to quote you a price so that you can swap from one asset to another.
You can swap without trust or reliance upon a central party.
Anyone can provide liquidity to a liquidity pool, earning fees in exchange for the exposure to impermanent loss (IL).
This is a shift from conventional markets and centralised exchanges, which typically offer a central limit order book (CLOB) mechanism of exchange.
As a result, AMMs are a fundamental and critical part of any broader Decentralised Finance (DeFi) ecosystem.
Pact offers a user-friendly, low-cost, lightning-fast experience, making it accessible to a wide range of users across all levels of expertise, skill and wealth.
Pact is built with the technical sophistication and assurance of Algorand's Pure Proof-of-Stake (PPoS) consensus mechanism. Its smart contracts have been engineered with security in mind and validated by multiple 3rd party security audits and bug bounties.
Pact is built with a permissionless design; its capabilities are open to public use, with no ability to selectively censor or restrict users. Anyone can make swaps, provide liquidity, and most, importantly - withdraw funds at any time.
Pact is powered by smart contracts on the Algorand blockchain with minimal centralised control or authority.
Pact protocol is immutable; in other words, not changeable/editable. No party can pause the contracts, reverse trade execution, or otherwise change the behaviour of the core business logic of the protocol in any way.
While Pact is decentralised and permissionless, it is worth noting that Pact has the right to perform a small set of contract administrative tasks, such as configuring the "amplifier" parameter on StableSwap pools (crucial for ensuring pools remain healthy) and setting the treasury fee accrual account. That being said, these capabilities are minimal and transparently disclosed to all participants in advance. Pact remains committed to the ethos of decentralisation.