> ## Documentation Index
> Fetch the complete documentation index at: https://docs.kovaswap.finance/llms.txt
> Use this file to discover all available pages before exploring further.

# How KovaSwap works

> The protocol, router, safety layer, and interface at a glance.

KovaSwap separates the exchange into simple, replaceable layers:

1. **Factory:** creates deterministic pair contracts for a token pair and fee tier.
2. **Pairs:** hold reserves and enforce constant-product swaps.
3. **Router:** calculates paths and executes liquidity or swap operations.
4. **Route discovery:** compares local KovaSwap quotes with enabled external venues.
5. **Indexer:** derives pools, volume, fees, and token history from chain events.
6. **Interface and SDK:** present wallet-ready transactions without taking custody.

Pool creation emits an on-chain factory event. That event is the source for discovery and analytics. A new pool is not “approved” by KovaSwap; it is simply visible because it exists.

## What decentralization means here

The core market path does not need a manual token whitelist. Users remain free to interact directly with contracts. Safety data is evidence, not a trade gate. Configuration and interface hosting can be replicated, while contract ownership should move to transparent multisig or governance controls before production.