How Does a Change in the Value of “K” Affect the Pool’s Price Curve?

The value of "k" determines the shape and position of the hyperbolic price curve defined by x y=k. A larger "k" pushes the curve further away from the origin (0,0).

This signifies deeper liquidity, meaning the curve is flatter in the trading range. A flatter curve indicates that a trade of a given size will result in a smaller price change, thus reducing slippage.

Conversely, a smaller "k" results in a steeper curve, leading to higher slippage.