How Pricing Works

EXNIHILO derives all prices from its own AMM curves. There are no oracles.

Spot price

The spot price of the underlying token in USDC is:

spotPrice = backedAirUsd / backedAirToken

This represents the raw USDC units per whole token. The frontend adjusts for decimals when displaying.

Constant-product formula

All three AMM curves use the same formula:

amountOut = amountIn * reserveOut / (reserveIn + amountIn)

This is the standard Uniswap-style x * y = k model. Larger trades relative to reserves incur more slippage.

Three curves, three reserve pairs

Curve	reserveIn / reserveOut	Purpose
SWAP-1	backedAirToken ↔ backedAirUsd	Normal swaps
SWAP-2	backedAirToken ↔ airUsd.totalSupply()	Long open / short close
SWAP-3	airToken.totalSupply() ↔ backedAirUsd	Short open / long close

The key difference between curves is what counts as "reserves":

• SWAP-1 uses only backed reserves (real collateral)
• SWAP-2 / SWAP-3 use one backed reserve and one totalSupply (backed + synthetic)

This means leveraged positions trade against a different curve than spot swaps, which is what creates the leveraged exposure.

Price impact

Price impact depends on trade size relative to reserves:

• Small trades: minimal slippage
• Large trades: significant slippage
• The minAmountOut parameter on every operation protects against excessive slippage

No oracle manipulation

Since prices are derived entirely from the pool's own state, there is no oracle to manipulate. However, the pool price can diverge from external market prices — this creates arbitrage opportunities that help keep prices aligned.