ILV model - Stable

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This diagram models a blockchain-based trading and liquidity pool system, focusing on the exchange between Ethereum (ETH) and a token (referred to as ILV in the diagram, presumably a fictional cryptocurrency or utility token). In this system, there are pools designated for ETH and ILV tokens, signifying the holdings or liquidity available for each currency. The dynamic interaction between these pools is orchestrated through various operations such as transfers, conversions, and the computation of prices.

The diagram includes mechanisms for calculating the price of ILV tokens relative to ETH, simulating transactions between pools to reflect trading activities (transferring ETH for ILV and vice versa), and adjusting token quantities based on these interactions. Resource connections facilitate the flow of tokens between pools, while state connections modify the diagram's state, impacting elements like conversion rates and quantities based on predefined formulas. Registers compute the price of ILV in terms of ETH (and potentially other variables like transaction costs), presenting a simplified model of a decentralized finance (DeFi) platform where users can stake, trade, and manage cryptocurrencies within a liquidity pool. The inclusion of a drain signifies the removal or consumption of resources, possibly representing transaction fees, token burning mechanisms, or withdrawal of liquidity.