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Order matching Meaning

The core function of an exchange where buy orders and sell orders are compared and paired. When a buy price equals or exceeds a sell price, a trade occurs.

This process happens millions of times per second. The "Matching Engine" is the software component responsible for this.

Its determinism is critical: the same inputs must always yield the same trade outputs to ensure fairness.

In DeFi, AMMs (Automated Market Makers) replace traditional order matching with a mathematical formula (x\*y=k), where traders trade against a pool of liquidity rather than a specific counterparty.

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