Liquidity pools are pools of tokens (or token pairs) that act as reserves for certain tokens. These reserves facilitate trade on the AMMs (thus providing these platforms “liquidity”).  Typically, one of the tokens in the liquidity pools has to be ETH. But lately, we’ve been seeing major shifts in it. Uniswap V2, for example, has added the ERC20/ERC20 liquidity pool on its platform. This removes the need for ETH to be one of the tokens in the pool.