# What is a DEX?

The system in place obviates the need for trusted intermediaries, prioritizing **decentralization**, **censorship resistance**, and **security**.

Each Sonus smart contract, or pair, manages a liquidity pool made up of reserves of two ERC-20 tokens.

#### Permissionless market creation <a href="#heading-permissionless-market-creation" id="heading-permissionless-market-creation"></a>

Users can permissionlessly create markets for a wide variety of tokens on a DEX. Users can then deposit tokens into these markets, facilitating token swaps without gatekeepers.

#### Price discovery <a href="#heading-price-discovery" id="heading-price-discovery"></a>

Users need token price history to do almost anything in DeFi. When DEXs are adequately liquid and active with swaps and arbitrage activity, they provide accurate pricing information on tokens, allowing oracles, automated trading, and other functions that rely on these data to operate correctly.

In practice, Sonus applies a 0.30% fee to trades. This functions as a payout to veSONUS voters, which is realized at the end of each epoch. This is the standard fee, but this can vary depending on the assets in the pair.

**Every DEX has the same goal as a marketplace: offer the best trade execution with the most liquidity, so traders use that DEX and not other modes of swapping.**


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