# AMM 101

### 1. Identify FT on Flow

Unlike on EVM, simply using a contract address is **not** enough to identify FTs on FVM. The unique identifier for FT is composed of: `A.16-byte`-`address.name`. 

For example:

* `A.b19436aae4d94622.FiatToken` is USDC's **unique identifier** on mainnet. 
* Also `ceWETH` and `ceWBTC` (Celer-Bridged wETH & wBTC from ETH) are deployed under the same address but with different identifiers:  `A.231cc0dbbcffc4b7.ceWETH`, and `A.231cc0dbbcffc4b7.ceWBTC`.

### 2. Interact with FT on Flow

#### Paths

FT on FVM conforms to the `FungibleToken` [interface](https://flow-view-source.com/mainnet/account/0xf233dcee88fe0abe/contract/FungibleToken). One specific FT is represented as a Vault resource and stored directly under the holder' account storage area.

So each FT is also associated with several [paths](https://docs.onflow.org/cadence/language/accounts/#paths) used to interact with it. Check the `tokenlist` file [here](https://github.com/IncrementFi/token-list/blob/main/tokenlist.mainnet.json) for FT details on mainnet. 

#### FT Resource Initialization

Unlike FT on EVM, one cannot 'airdrop' FT to arbitrary address without the receiver account first initializing the FT resource once (using `FT.createEmptyVault()` method). 

* Example transaction: `init_usdc_vault.cdc`

```
import FungibleToken from 0xf233dcee88fe0abe  // mainnet
import FiatToken from 0xb19436aae4d94622      // mainnet

transaction() {
    prepare(signer: AuthAccount) {
        let vaultPath = /storage/USDCVault
        let receiverPath = /public/USDCVaultReceiver
        let balancePath = /public/USDCVaultBalance

        if signer.borrow<&FungibleToken.Vault>(from: vaultPath) == nil {
            signer.save(<- FiatToken.createEmptyVault(), to: vaultPath)
            signer.link<&FiatToken.Vault{FungibleToken.Receiver}>(receiverPath, target: vaultPath)
            signer.link<&FiatToken.Vault{FungibleToken.Balance}>(balancePath, target: vaultPath)
        }
    }
}
```

The initialization only needs to be done once per holder account for one specific FT. After that any further action like: deposit / withdraw / etc. can be performed flawlessly.

**\***&#x4E;ote: `FlowToken` is also FT but it's the only exception that it doesn't need initialization - as the init step has been performed when the account is created.

### 3. CPAMM Principles

Check Uniswap-V2 whitepaper here: <https://uniswap.org/whitepaper.pdf>

### 4. Understanding Impermanent loss (IL)

![Source: https://docs.uniswap.org/protocol/V2/concepts/advanced-topics/understanding-returns](/files/DaTEZcx4quq7bCvIDj5b)


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