# Bonding Curve

### What is a Bonding Curve?

A bonding curve is a smart contract mechanism that determines the price of AI agent tokens based on supply and demand. It ensures **fair and decentralized price** discovery, allowing AI agents to launch without traditional token sales or pre-mines.

### How the Bonding Curve Works in AImagine

#### 1. Token Generation & Liquidity Pooling

* When an AI agent is created, its **tokens are minted** and made available via a bonding curve.
* Users can <mark style="color:orange;">**buy and sell**</mark> agent tokens directly from the bonding curve.

#### 2. Dynamic Pricing Model

* The more tokens purchased, the higher the price <mark style="color:orange;">**moves along the curve**</mark><mark style="color:orange;">.</mark>
* If tokens are sold, the price decreases, ensuring <mark style="color:orange;">**fair and transparent**</mark> value adjustments.

#### 3. Liquidity & Market Stability

* AI agent tokens are paired with <mark style="color:orange;">**$AIMG**</mark><mark style="color:orange;">,</mark> creating instant liquidity.
* Ensures that AI agent tokens have <mark style="color:orange;">**stable markets**</mark> without centralized control.

### Advantages of the Bonding Curve Model

* No Insider Advantage: Every participant has equal access to AI agent tokens at market-driven prices.
* Instant Liquidity: Users can buy or sell at any time without waiting for counterparties.
* Decentralized Price Discovery: The market determines token value based on real-time demand.
* Sustainable Growth: Ensures AI agent tokens remain liquid and valuable over time.