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# Token price
The token market is modeled as a single AMM (Automated Market Maker) pool representing all the aggregated liquidity available from various CEX and DEX where the token may be traded. The pool is between the protocol native token and an arbitrary USD-valued token, with an AMM law of *X \* Y = K,* where *K* remains constant for a certain liquidity.
All token purchases and sales are executed against this pool, altering the amount *X* of the protocol token and *Y* of USD so that K remains the same (*K = X' \* Y'*). These trades cause a change in the token price, defined as *P = Y / X.*
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