# How Does the "Amplification Factor" in StableSwap Affect the Curve's Shape and Slippage? ⎊ Path

**Published:** 2025-12-05
**Author:** Greeks.live
**Categories:** Path

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## How Does the “Amplification Factor” in StableSwap Affect the Curve’s Shape and Slippage?

The amplification factor (A) is a parameter that determines how closely the StableSwap curve approximates the constant sum formula near the 1:1 peg. A higher A value creates a flatter curve around the peg, meaning lower slippage and deeper virtual liquidity.

This optimization is crucial for efficient stablecoin trading. However, a very high A also increases the risk of severe impermanent loss if the peg breaks, as the pool is more easily drained of the healthy asset.

- [How Does the Choice of Strike Price Affect the Trade-off between Premium Income and Upside Potential?](https://learn.greeks.live/path/how-does-the-choice-of-strike-price-affect-the-trade-off-between-premium-income-and-upside-potential/)

- [How Does Curve’s “Stableswap Invariant” Formula Achieve Low Slippage for Pegged Assets?](https://learn.greeks.live/path/how-does-curves-stableswap-invariant-formula-achieve-low-slippage-for-pegged-assets/)

- [How Does a Change in the Value of “K” Affect the Pool’s Price Curve?](https://learn.greeks.live/path/how-does-a-change-in-the-value-of-k-affect-the-pools-price-curve/)

- [How Does the Concept of “Liquidity Mining” Aim to Reduce Slippage on DEXs?](https://learn.greeks.live/path/how-does-the-concept-of-liquidity-mining-aim-to-reduce-slippage-on-dexs/)

- [What Is the Primary Risk of a Short Volatility Position in This Scenario?](https://learn.greeks.live/path/what-is-the-primary-risk-of-a-short-volatility-position-in-this-scenario/)

- [How Does the “Amplification Factor” in Stableswap Pools Affect the Curve’s Shape?](https://learn.greeks.live/path/how-does-the-amplification-factor-in-stableswap-pools-affect-the-curves-shape/)

- [How Do “Stableswap” AMMs Modify the X · Y = K Formula for Pegged Assets?](https://learn.greeks.live/path/how-do-stableswap-amms-modify-the-x-%c2%b7-y-k-formula-for-pegged-assets/)

- [How Does a ‘Hybrid AMM’ (Like Curve’s Stableswap) Combine Features of Constant Product and Constant Sum?](https://learn.greeks.live/path/how-does-a-hybrid-amm-like-curves-stableswap-combine-features-of-constant-product-and-constant-sum/)

## Glossar

### [StableSwap](https://learn.greeks.live/area/stableswap/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Architecture ⎊ The StableSwap protocol, initially popularized by Curve Finance, represents a distinct automated market maker (AMM) design diverging from the constant product model prevalent in platforms like Uniswap.

### [Amplification Factor](https://learn.greeks.live/area/amplification-factor/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Factor ⎊ The amplification factor, within cryptocurrency derivatives and options trading, quantifies the sensitivity of an underlying asset's price movement to changes in the price of a related derivative contract.

### [Stableswap Curve](https://learn.greeks.live/area/stableswap-curve/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)

Architecture ⎊ Stableswap Curve represents a novel automated market maker (AMM) design prioritizing stable asset trading, diverging from constant product formulas.

## Discover More

### [Explain the Difference between a Constant Product and a Constant Sum AMM Curve](https://learn.greeks.live/path/explain-the-difference-between-a-constant-product-and-a-constant-sum-amm-curve/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![Explain the Difference between a Constant Product and a Constant Sum AMM Curve](https://learn.greeks.live/wp-content/uploads/2025/10/Symmetrical-Intersecting-Black-Scalar-Beams-Encapsulating-Central-Volatile-Digital-Asset-Orbs.webp)

Constant product is for volatile pairs; constant sum is for pegged pairs to minimize slippage and IL.

### [What Is a "Liquidity Crunch" and How Does It Affect the Futures Curve?](https://learn.greeks.live/path/what-is-a-liquidity-crunch-and-how-does-it-affect-the-futures-curve/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is a "Liquidity Crunch" and How Does It Affect the Futures Curve?](https://learn.greeks.live/wp-content/uploads/2025/10/Dual-Lens-Digital-Sensor-Array-Representing-Decentralized-Exchange-Liquidity-Provisioning-Mechanisms.webp)

A liquidity crunch is a sudden lack of funds, causing forced selling that can lead to a steep backwardation in near-term futures.

### [How Does Elliptic Curve Digital Signature Algorithm (ECDSA) Protect against Preimage Attacks?](https://learn.greeks.live/path/how-does-elliptic-curve-digital-signature-algorithm-ecdsa-protect-against-preimage-attacks/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Does Elliptic Curve Digital Signature Algorithm (ECDSA) Protect against Preimage Attacks?](https://learn.greeks.live/wp-content/uploads/2025/10/Specular-Refraction-Across-a-Translucent-Digital-Asset-Interface-Analyzing-Volatility-Skew-Surfaces.webp)

ECDSA's security relies on the difficulty of the elliptic curve discrete logarithm problem, not directly on hash preimage resistance.

### [Describe the Profit/loss Diagram Shape for a Covered Call Strategy](https://learn.greeks.live/path/describe-the-profit-loss-diagram-shape-for-a-covered-call-strategy/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![Describe the Profit/loss Diagram Shape for a Covered Call Strategy](https://learn.greeks.live/wp-content/uploads/2025/10/Crystalline-Clock-Hands-Intersecting-Over-Reflective-Digital-Asset-Ledger-Surface-Representing-Volatility.webp)

The diagram is a line that slopes up from the maximum loss point and flattens into a limited maximum profit above the strike price.

### [What Are the Risks of Using a Poorly Chosen Elliptic Curve?](https://learn.greeks.live/path/what-are-the-risks-of-using-a-poorly-chosen-elliptic-curve/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Are the Risks of Using a Poorly Chosen Elliptic Curve?](https://learn.greeks.live/wp-content/uploads/2025/10/Quantum-Magnetically-Levitated-Asset-Core-Reflection-of-Decentralized-Derivatives-Exchange-Mechanism.webp)

A weak curve can allow attackers to efficiently solve the ECDLP, compromising private keys and all digital signatures.

### [What Is 'Slippage' in Cryptocurrency Arbitrage and How Does It Affect Profitability?](https://learn.greeks.live/path/what-is-slippage-in-cryptocurrency-arbitrage-and-how-does-it-affect-profitability/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is 'Slippage' in Cryptocurrency Arbitrage and How Does It Affect Profitability?](https://learn.greeks.live/wp-content/uploads/2025/10/Simulated-High-Frequency-Crypto-Derivative-Sampling-Apparatus-Aperture-Interface-Visualization.webp)

Slippage is the price change your own trade causes, eating away at the profits you were trying to capture.

### [What Is the Mathematical Formula That Defines the Impermanent Loss Curve?](https://learn.greeks.live/path/what-is-the-mathematical-formula-that-defines-the-impermanent-loss-curve/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![What Is the Mathematical Formula That Defines the Impermanent Loss Curve?](https://learn.greeks.live/wp-content/uploads/2025/10/Decentralized-Autonomous-Organization-Governance-Spoke-Structure-Representing-Asymmetric-Option-Payoff-Profiles.webp)

Impermanent loss is calculated as 2 sqrt(price_ratio) / (1+price_ratio) – 1, showing how value is lost as asset prices diverge.

### [How Does the Concept of a "Bonding Curve" Generalize the Constant Product and Constant Sum Models?](https://learn.greeks.live/path/how-does-the-concept-of-a-bonding-curve-generalize-the-constant-product-and-constant-sum-models/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Does the Concept of a "Bonding Curve" Generalize the Constant Product and Constant Sum Models?](https://learn.greeks.live/wp-content/uploads/2025/10/Transparent-Algorithmic-Sphere-Traversing-Sloped-Decentralized-Exchange-Execution-Rails.webp)

A bonding curve is a general function defining price-supply; x · y = k and x+y=k are specific convex and linear examples.

### [How Does a 'Hybrid AMM' (Like Curve's Stableswap) Combine Features of Constant Product and Constant Sum?](https://learn.greeks.live/path/how-does-a-hybrid-amm-like-curves-stableswap-combine-features-of-constant-product-and-constant-sum/?utm_source=crypto.greeks.live&utm_medium=referral&utm_campaign=satellite)
![How Does a 'Hybrid AMM' (Like Curve's Stableswap) Combine Features of Constant Product and Constant Sum?](https://learn.greeks.live/wp-content/uploads/2025/10/Conceptual-Depiction-of-Exotic-Options-Payoff-Structure-Through-Planetary-Probe-Simulation.webp)

It uses a curve that is Constant Sum near the peg for low slippage and Constant Product far from the peg to prevent draining.

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**Original URL:** https://learn.greeks.live/learn/how-does-the-amplification-factor-in-stableswap-affect-the-curves-shape-and-slippage/
