# PumpaNomics

Ever wondered how much new money a token needs to 2x, 5x, 10x or even 100x? Enter token address to find out.

### SUPPORTED CHAINS

### How PumpaNomics Works

PumpaNomics uses the __Constant Product Formula__, which is the basis for many decentralized exchanges like Uniswap V2 and their forks. Here's how it works:

**Liquidity Pool:**The pool contains two tokens, each representing half of the total liquidity value.**Constant Product:**The product of the two token quantities always remains constant k = x * y.**Price Impact:**Adding one token to the pool (buy pressure) increases x and decreases y to maintain the constant k.**Price Calculation:**The price is determined by the ratio of the two tokens Price = y / x.**Price Increase:**As x increases and y decreases, the price of the token being bought rises.

**PumpaNomics Accuracy:** For more realistic results, PumpaNomics uses combined liquidity across all onchain pools in its calculations, accounting for factors like arbitrage and market depth.

**Key Insight:** The constant product formula exhibits a quadratic relationship between liquidity and price. Doubling the liquidity (100% increase) results in a 4X price increase. This quadratic nature means that price changes are more dramatic than linear relationships. Here's why:

- Initial state: x = y = √k
- After doubling x: new_x = 2√k, new_y = k/(2√k) = √k/2
- New price ratio: (√k/2) / (2√k) = 1/4 of the original ratio
- This means the price of the token being bought is now 4 times higher

**Understanding Results:** The calculator shows how an injection of capital into a liquidity pool affects the token price. The result is displayed as both a percentage increase and an "X" multiplier.

**Percentage vs. Multiplier:**A 200% increase means tripling the original value (3X). It's calculated as: original value + 200% of original value = 3 times the original value. Similarly, 100% increase is 2X, 300% is 4X, and so on. The multiplier is always one more than the percentage increase divided by 100.

#### Limitations

- No data from centralized exchanges is included in the calculations.
- The model doesn't account for potential liquidity on other blockchain networks.
- The model assumes no sell pressure during the liquidity injection, projecting price changes as if the entire amount is added without concurrent selling activity.