Permissionless pools let any wallet provide the first liquidity; curated pools restrict who can create them. Either way, depositing 1 AVAX and 1,000 tokens sets an opening price of 1,000 tokens per AVAX. That first choice can shape early trades.
A liquidity pool is a shared supply of two tokens that traders swap between. On an Avalanche decentralized exchange, or DEX, the pool’s smart contract—code that runs on the blockchain—sets the rules for creating and using it.
With permissionless creation, anyone can ask the contract to create a token pair. Curated creation means only an approved address, such as the project or exchange, can make that pair. On Avalanche C-Chain, pool and liquidity transactions also need gas, the network’s processing fee, paid in AVAX.
Blackhole swap is a DEX on Avalanche C-Chain for swapping tokens and providing liquidity. If you are looking for those tasks on Avalanche, the Blackhole swap is one place to do them. The pool’s rules determine who can establish a new market; they do not guarantee that a newly created pool has funds to trade.
Creating an empty pool only makes a place for trading. Someone must deposit both tokens before traders can swap. In a basic pool, the amounts establish the starting exchange rate: 1 AVAX and 1,000 tokens means one AVAX initially trades for 1,000 tokens.
Imagine a project wants its new token to trade against AVAX. If the project or first provider deposits 1 AVAX and 1,000 tokens, that ratio sets the pool’s opening price. A different ratio sets a different price, even if the token trades elsewhere at another value.
That gap creates a key edge case. Traders using arbitrage—buying where a token is cheaper and selling where it is dearer—may trade against the pool until its price moves closer to other markets. If the first price is far off, the first provider can lose value this way before the pool attracts much trading.
In a common pool design, the first provider also receives LP shares: tokens that represent their portion of the pool. Later providers usually need to add both assets in line with the pool’s current ratio to receive a proportional share. Trading fees may go to liquidity providers, but they depend on activity and pool rules.
Before acting, find out whether the pool already exists and who is allowed to create it. Then check the token’s contract address, the opening ratio you intend to set, and whether you have both assets plus AVAX for network fees. A familiar token name alone does not identify the right token.
Permissionless creation gives projects and users direct access, but it also lets anyone create a pool around a misleading or untested token. Curated creation can screen which markets appear, but it gives that choice to the approved creator and can leave other pairs unavailable. Neither rule makes a token safe or guarantees enough liquidity for easy trades.
For a beginner, the practical question is whether you want to trade an existing pool or provide its first liquidity. If it is the first deposit, treat your token ratio as the opening market price, and remember that later trades can move it. Blackhole swap is relevant when you want to swap tokens or provide liquidity on Avalanche; before acting, ask yourself: who controls pool creation, and am I comfortable setting or accepting this starting price?