Waves Tech developers announced the launch of the automated market maker Swop.fi. The new service on the Waves blockchain will allow liquidity providers to earn rewards from swap operations. Company representatives told ForkLog.
Swop.fi combines several types of liquidity pools with different price calculation formulas, optimized for each token pair. Anyone may deposit coins into a pool and earn from swap operation fees. Liquidity providers are offered additional compensation through the distribution of the SWOP governance token.
An automated market maker is a smart contract that enables instant token swaps and replaces a traditional order-book exchange. The swap price depends solely on the quantities of tokens held in the smart contract.
The network fee for calling a smart contract in the Waves ecosystem is fixed at 0.005 WAVES (less than 2 cents).
Swop.fi provides two price calculation formulas:
- Classic with constant product (Constant Product Market Maker, CPMM);
- With reduced slippage for stablecoins (Flat).
For each newly created pool, users will be able to choose the most suitable formula.
At launch, the following pools will be available:
- WAVES-USDN — CPMM;
- BTC-USDN — CPMM;
- WAVES-BTC — CFMM;
- USDN-USDT — flat.
Trading fees when swapping tokens within a pool are 0.3% of the amount (0.05% for the USDN/USDT pair). Of the trading fees, 60% go to liquidity providers of that pool, and 40% go to increasing the capitalization of the SWOP governance token by sending funds to the SWOP-USDN pool.
SWOP token holders will be able to govern the following parameters:
- the size of the fee;
- the share of the fee directed to the SWOP-USDN pool;
- the selection of pools whose liquidity providers will be additionally rewarded with SWOP governance tokens.
The initial distribution of SWOP tokens will occur at the project’s third phase. Liquidity providers for the four base pools will receive SWOP tokens corresponding to their liquidity share in the pool since the project’s launch. Simultaneously with the initial SWOP distribution the SWOP-USDN pool will be launched.
For early liquidity providers, 1 million SWOP tokens are reserved, to be issued daily during the first year.
Waves Tech is a comprehensive ecosystem of innovative blockchain-based solutions and products, focused on cross-chain decentralized finance (InDeFi). Waves Tech leverages the advantages of the Waves, Neutrino and Gravity blockchain protocols.
Earlier Waves developers announced the integration of the Solana blockchain into the Gravity protocol.
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