## V2 Basics
Unlike V1, Hex One protocol V2 enables liquidity pools composed of multiple token pairs, instead of being restricted to only one token pair. LPs can not only deposit a single token, instead of a pair but also the way the AMM is built differently, with coverage ratios.
While V1 required a pool to contain either one or two tokens, the V2 pool enables a much better mechanic where multiple tokens are pooled all at once into the same pool and can be deposited individually.
This mechanism should provide extra price stability.
Not only that but additional T-Share tokens could be added as collateral, such as [Maximus DAO's Perpetual](https://www.maximusdao.com/perpetuals) and/or [Hedron's Staking Instances (HSIs)](https://hedron.pro/).
The final tweak in the functionality of v2 is that staking only pays LP providers in certain price ranges, using [Soresu's](https://soresu.xyz) techniques.
## V2 Functionality
The greatest improvement between V1 and V2 is substantially less slippage, that is the difference between the expected price of an order and the price when the order actually executes.
By locking liquidity between more than two pairs, Hex One improves the swapping mechanism since the likelihood of slippage occurring is lower.
Additionally, Hex One protocol adopts the model proposed by [Platypus](https://cdn.platypus.finance/Platypus_AMM_Yellow_Paper.pdf) based on Coverage Ratio instead of liquidity, where the protocol "uses coverage ratio as the input parameter for the AMM (instead of liquidity), hence removing the same liquidity equilibrium constraint from Curve’s stable swap invariant, allows the token to grow organically based on its nature demand and supply".
In other words, coverage ratios work much like insurance where the protocol takes on the risk of impermanent loss, instead of the individual user (the market maker).
Therefore, the main improvements are:
* **Additional collateral tokens backed by t-shares,**
* **Less slippage between swaps,**
* **Less Impermanent Loss since the IL risk is now covered by the protocol.**
Additionally, to the points laid out, we should underline we may change how liquidations work in order to increase the peg stability.
There is no date or guarantee Hex One v2 will ever be developed or deployed. **Please have no expectations from the work of others.** Big boy pants.
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