# What is Cardax? Cardax DEX is a non-custodial, Automated Market Maker (AMM) decentralised exchange on Milkomeda. The primary goal of the Cardax DEX is to provide users with products (initially swaps and liquidity pools) with the least amount of congestion possible. We achieve this is achieved in a novel way. CardaxDEX allows users to trade any ERC-20 token, Cardano native tokens (after converting it)and stablecoins. Large, centralised exchanges (Binance, Kucoin etc) use an order book model and most decentralised exchanges use a standard AMM model. ## **Cardax DEX uses the AMM model.** *A quick word on order book and AMM exchange models:* Order book model exchanges work best when there is high liquidity between trading pairs. Users list their buy or sell orders and the exchange matches buy orders to sell orders. AMM exchanges are better suited to trading pairs that may have low liquidity. Users have the advantage of being [liquidity providers ](https://www.cardax.io/academy/the-complete-guide-to-liquidity-pools)(LP; that is, supplying their own tokens to a “communal pool” for a trading pair). Any user wishing to make a trade between a pair that has a liquidity pool will be able to do so, even if the market as a whole has low liquidity. The benefit of AMM exchanges is that because there is a liquidity pool of each pair of tokens, there will always be market for the tokens. The speed and efficiency that is provided by using the Cardax DEX should **reduce slippage**. Slippage is the difference in price between the price at which you made your order and the price at which the order is executed. Primarily this is a problem with low liquidity volatile trading pairs and on DEXs that have long queues of unprocessed transactions built up. [Impermanent loss](https://www.cardax.io/academy/what-is-impermanent-loss) on the other hand is the bain of liquidity providers on AMM exchanges. Impermanent loss refers to the change in the price of a liquidity provider’s deposited assets, between the price they deposited them at and the current price. It is called “impermanent” because this loss would only be realised if the LP removes their tokens from the pool before the price returns to its original value. Version 1 of the Cardax DEX features token swaps and liquidity pools, with more upgrades and products launching in future versions. --- # Agent Instructions: Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://docs.cardax.io/introduction/what-is-cardax.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.