Market smoothing is a key benefit of Automated Market Makers (AMMs). By providing liquidity and updating prices in real-time, AMMs can help:

1. _Reduce price volatility_: AMMs can help smooth out price movements, reducing the impact of sudden price swings.

2. _Create a more stable market environment_: By providing liquidity and stabilizing prices, AMMs can create a more stable market environment, reducing uncertainty and risk.

3. _Improve market efficiency_: AMMs can improve market efficiency by ensuring prices reflect true market conditions, reducing the impact of emotional or irrational trading decisions.

4. _Protect against market manipulation_: AMMs can help prevent market manipulation by providing a fair and transparent pricing mechanism.

5. _Support liquidity_: AMMs can provide liquidity, even in times of market stress, helping to maintain a stable market environment.

6. _Encourage trading_: By providing a stable and efficient market environment, AMMs can encourage trading and investment.

7. _Reduce market fragmentation_: AMMs can help reduce market fragmentation by providing a unified and transparent pricing mechanism.

By smoothing out price movements and creating a more stable market environment, AMMs can help reduce uncertainty and risk, making markets more efficient and attractive to traders and investors.