After challenging the dominance of the world’s largest decentralized exchange over the past few months, the bit-bay DEX has finally been accepted by the top-three trading platform. While it will be a while before it can dethrone its predecessor, it’s not hard to see the DEX becoming the most popular decentralized trading solution in the near future.
As we all know, decentralized exchanges are the future of crypto. But, not all DEX’s are made equal. One DEX in particular is about to take the crypto world by storm. This DEX doesn’t just focus on token to token transactions, it also facilitates the exchange of fiat to tokens and vice versa. The DEX has a strong reputation and is well known for its customer support. The DEX is easy to use and has many features that makes it stand out. We all know that the DEX has a ton of potential, and is capable of becoming a Uniswap Killer.
As the crypto-community is all too aware of, the last few months have been difficult for decentralised exchanges. The Silk Road, DEX, was hacked and the project is dead. Another DEX, EtherDelta, was hacked and the project has not recovered as it has not implemented a withdrawal function. (EtherDelta has a working withdrawal function, as far as we can tell, but the users are unable to use it until the contract is upgraded.) The Uniswap DEX has been the most successful DEX in the last few months, but is this success justified? Is it really the DEX of the future? Or will it suffer the same fate as the projects that came before it?. Read more about uniswap exchange and let us know what you think. From prototypes and experimental ideas to a $80+ billion industry: Decentralized finance is the new big thing in finance, alongside the rise of fintech giants. Only time will tell if this is the next step in the evolution of the banking system after Wall Street, but the momentum is certainly not waning. The gateway to DeFi, according to some, is the Decentralized Exchange (DEX). In our SushiSwap test, we look at one of these DEX that dares to be different. Many people think of Uniswap when they hear the words decentralized exchange. While Uniswap remains a behemoth in terms of scale, some people may be put off by its simplicity. Surely DEX can be more than just a platform to trade one token for another? SushiSwap is here, offering a variety of services from growing to renting to paying off. But is it enough to topple the best DEX? In our test of SushiSwap, we try to find out.
What is SushiSwap?
There are many similarities between the two DEX above, as SushiSwap was essentially born as a Uniswap spin-off in September 2020. Within hours of its launch, SushiSwap managed to raise over $1 billion in funds from Uniswap users. However, it sparked controversy after the unnamed founder, Chef Nomi, emptied SushiSwap’s development fund and redeemed it for 37,400 ETH, which was worth about $14,000,000 at the time. The SushiSwap SUSHI tokens then lost 70% of their value within a day, after which the funds were returned to the community. However, SushiSwap quickly recovered from the incident and is now one of the largest DeFi protocols, with over $4.7 billion in cash stored on the platform. This happened with a total trading volume of over $65 billion on 1,110 pairs. There are currently 150,000 users worldwide who own SUSHI tokens and are active on SushiSwap.
How does SushiSwap work?
As we mentioned in our review of SushiSwap, SushiSwap is a decentralized exchange or DEX. Unlike regular, centralized cryptocurrency exchanges, DEXs like SushiSwap are fundamentally different in how they work. Instead of a more traditional peer-to-peer mechanism or order book to facilitate market making and asset pricing, SushiSwap relies on an AMM (Automated Market Maker). It uses algorithms instead of buyers and sellers to set prices. With MSAs, users negotiate against these algorithms. Users can pool tokens for a specific currency pair – for example UNI-SUSHI (Uniswap – SushiSwap) – into liquidity pools and become liquidity providers (LPs). When a user wants to buy a token, they exchange one token for another from one of these pools, whose algorithms determine a fair market price based on important parameters such as supply, demand, volatility, etc. LPs are then rewarded with a portion of the trading fee.
How to trade on SushiSwap?
We can see this MSA-based trading in action in our SushiSwap review by opening their dApp (decentralized app) after connecting to a crypto-currency wallet. As mentioned earlier, SushiSwap has a large number of trading pairs, with over 1100 active markets to choose from. As for the commission, SushiSwap, just like Uniswap, charges a fixed transaction fee of 0.3%. The beauty of the SushiSwap token exchange protocol is that it is not only compatible with Ethereum. Since the network is multi-tiered, you can trade assets between different blockchains. This is a great advantage if you’re trying to find better prices elsewhere, engage in arbitrage, or reduce gas rates. You can trade on the Ethereum blockchain, but you can switch from it immediately to the likes of Binance Smart Chain (BSC), Polygon (Matic), xDai, Avalanche, OKExChain and others. The multi-channel feature ensures users get the most competitive prices and also offers a good deal on LPs. The most important part of DEX is liquidity, and you can contribute to that by becoming a liquidity provider (LP). Another important difference from Uniswap (V2) is the way SushiSwap makes payments to lenders. Instead of a 0.3% commission like Uniswap, SushiSwap LPs pays a lower commission of 0.25% of all transactions. However, another 0.05% of the revenue will be pooled and distributed to all SUSHI token holders as an incentive to join the platform.
What else can I do at SushiSwap?
Besides trading and pooling assets, as we noted in our article on SushiSwap, there are many other things you can do. This is another big difference from Uniswap, as SushiSwap offers many more services with its protocol. Here are some examples:
1. Harvesting with Onsen
SushiSwap has Onsen, a revenue aggregator that allows DeFi projects to obtain liquidity through SushiSwap and build their own platform for its users. Think of it as a startup accelerator or a form of crowdfunding. Many DeFi protocols are already installing feedback tools on SushiSwap in exchange for very lucrative annual rewards for SushiSwap users, some as high as 10,000% at the time of writing this SushiSwap review.
2. Loans and leverage in Kashi transactions
Kashi is the exclusive service of SushiSwap that offers credit markets and leveraged transactions with highly elastic and attractive rates. On the lending side, you can lend your assets to other users at algorithmic rates, in return for which you receive a return, with an isolated market that limits risk and excessive volatility. You can borrow assets to make a profit without selling your assets. The value of the loaned chips can be up to 75% of your deposit.
3. Place xSUSHI via SushiBar
As we mentioned in our SushiSwap review, SUSHI token holders can receive a 0.05% commission on all transactions made on SushiSwap. You can earn this income by betting with SUSHI chips via SushiBar, for which you can earn xSUSHI in return. This not only allows you to passively earn betting bonuses – which at the time of writing are accruing at a rate of 9.99% per year – but also gives you the opportunity to participate in the management of SushiSwap in the chain. You can then exchange your SUSHI for xSUSHI at any time.
4. Interaction with gas-saving dApps via BentoBox
BentoBox is another service for our SushiSwap review, where so-called Mini dApps can be created and integrated into the SushiSwap chain. This innovative system allows users to access and receive feedback from dApps like DeFi. However, BentoBox’s unique design allows these dApps to go through BentoBox with lower transaction fees for gas, as this is still a bit of an issue in Ethereum. However, the only dApp currently available on BentoBox is Kashi.
What is SushiSwap’s SUSHI crypto token?
The proprietary currency of the SushiSwap protocol is the SUSHI token, and it is the main usable crypto-currency on the platform. SUSHI is a very popular trading pair on SushiSwap, available on many liquidity pools. Basically, SushiSwap plans to use SUSHI as a management token, i.e. an action that allows users to propose and vote on changes to the entire protocol. Although the number of tokens was originally supposed to be infinite, users later voted to limit the total number of tokens to 250,000,000 SUSHI. Fortunately, changes have been made to prevent a repeat of Chief Nomi’s situation. SushiSwap’s SUSHI tokens have become very valuable since their launch a few months ago. At the time of writing this review, SushiSwap costs a SUSHI approximately $17.67. That’s a massive increase of over 3,600% from the November 2020 low. With a market capitalization of $2,248,512,999, SushiSwap’s SUSHI is the 61st most expensive cryptocurrency on the market.
What will future updates to the SushiSwap roadmap look like?
Although the protocol is already well developed, SushiSwap is sticking to a very ambitious roadmap, with new features expected to be available in 2021. Some have already been completed at the time of writing this SushiSwap post, such as the BentoBox rental marketplace. In the future, we will soon see a V2 iteration of SushiSwap’s AMM, Mirin. The Mirin implementation will introduce franchise pools, dynamic rebalancing of returns, liquidity provider curve options and more. However, there are many other things planned that will benefit the platform as a whole, such as. B. the creation of Miso smart contracts, as well as tier 2 payment solutions to reduce some of the congestion on the Ethereum blockchain. They will also be working on cross-channel integrations with Rune and Moonbeam, as well as implementing SushiSwap on the Polkadot multi-channel. Other partnerships and projects are planned, such as cooperation with FRAX, DSD and BAO.
SushiSwap Review – Conclusion
When we finished our review of SushiSwap, we were amazed at how quickly such a young project has grown, not only in size, but also in functionality. SushiSwap showed us that an exchange can be used not only to trade tokens, but also to open up a range of services to users on the same platform. We’ll have to wait and see if Uniswap’s dominance is threatened, but SushiSwap is certainly a very functional DEX for your money.
Multiple liquidity pools (trading pairs) to choose from, with sufficient liquidity to ensure competitive pricing.
Provides many interesting and profitable value-added services for users beyond the exchange and aggregation of tokens – loans, borrowing, returns, rates, etc.
SUSHI token holders, including those who are not LPs (liquidity providers), may receive a portion of the commission for trading during the protocol.
Multi-chain support and integration with multiple blockchains allow users to switch networks as needed to find better rates or lower costs.
A strong commitment to future upgrades with Tier 2 scaling solutions, dApps and Smart Contracts optimization, as well as new features and partnerships.
The user interface and naming conventions for the various services can be difficult for new users to understand.
The DEX (decentralized exchange) is a cryptocurrency exchange protocol which is not controlled by any single person or entity. It allows people to trade cryptocurrencies in a peer-to-peer manner without any middlemen while avoiding security problems involved in centralized exchanges. The DEX protocol is the evolution of the one-to-one trading structure with which most people are familiar. It allows users to create orders and have them matched with other users, thereby creating a communal trading system.. Read more about uniswap vs sushiswap vs pancakeswap and let us know what you think.
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