# Glossary #### **Automated Market Maker (AMM)** A type of decentralised exchange that facilitates the exchange of assets through liquidity pools rather than conventional order books. They work by using a mathematical formula to price assets based on the amounts deposited and withdrawn from the pool through trading and liquidity provision. #### **Limit Order** An order to purchase or sell a token at a specified price or better. A buy limit order (or 'bid' order) will be executed only at the limit price or lower. A sell limit order (or 'ask' order) will be executed only at the limit price or higher. #### **Liquidity Provider** In the context of AMMs, the party that facilitates trading by providing liquidity and acting as the counterparty to fulfill those trades. Liquidity providers contribute a supply of tokens and earn trading fees on trades executed through the pool. #### **Market Maker** In traditional financial markets, refers to a market participant who provides liquidity by continuously offering to buy or sell large quantities of a particular asset to facilitate trading in a market. See [Liquidity Provider](#liquidity-provider) for the same in the context of Automated Market Makers. --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://haiko-docs.gitbook.io/docs/info/glossary.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.