Why can SwapX compete against Uniswap?

in LeoFinancelast month (edited)

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On September 17, the biggest hot spot in the DeFi world was "Uniswap issuing agreement tokens UNI and airdrop". For a time, a large number of users rushed to Uniswap. The surge in transaction volume caused the Ethereum network congestion to exceed the historical peak of network congestion, and the GAS fee was once. Up to 60U or more.

Before the emergence of SushiSwap, Uniswap has always been the top spot in the DeFi field. With only the core model of AMM (Automatic Market Maker), it has set a peak lock-up volume of US$2 billion, with daily transaction volume exceeding the center. The achievements of the head exchange Coinbase, etc., have established the industry's dominant position. The emergence of SushiSwap has shaken Uniswap's dominance. On the day that SushiSwap successfully migrated its liquidity (September 10), the total liquidity of Uniswap, which was "sucked", dropped by more than 70%. It was overtaken by SushiSwap. The talk of replacing Uniswap is rampant. One day later, the plot reversed, Uniswap staged a Jedi counterattack and successfully overtook SushiSwap.

Judging from the current lock-up volume, SushiSwap did not really shake the foundation of Uniswap, but Uniswap surpassed SushiSwap overnight. The liquidity mainly came from SashimiSwap (sashimi), not because its own innovation attracted new liquidity. , But SashimiSwap is a blood-sucking SushiSwap project, and there is another decentralized exchange SwapX, which is the same as SashimiSwap, which aims at the liquidity of SushiSwap. After the successful migration of SushiSwap, parasites in the "blood-sucking mode" continue to emerge. This is the biggest potential threat to Uniswap. After being continuously blood-sucked, how much market share Uniswap can occupy in the future is unknown, let alone always dominate.

In the DeFi world, the speed of innovation is unprecedented. The time for each leader is measured in weeks or even days. The reason why SushiSwap has become popular in a short period of time and attracted the market to follow suit is precisely because of its "Uniswap LP Token pledge mining and issuance platform. The new gameplay of "coin" allows users to capture more revenue. DEX issuance has become a trend and has been verified by the market. After all, most liquidity providers are rushing for high returns.

If you stand still, you will be abandoned by the times. This is a cruel reality and a force for innovation. DeFi seems to have become the biggest outlet at the moment. Even the three giants of CEX (centralized exchange) Huobi, Binance, and OKEx have all followed the trend and chose to integrate with DEX. Not only did they become crazy about DeFi tokens, but they also personally ended up practicing DeFi projects, such as Binance's Bakery (bread), although various Bakery rollovers are constantly being talked about, it is too early to say whether there will be a reversal in the follow-up. After all, many projects in the circle have staged similar projects. Plot.

Obviously, Uniswap also knows the truth about being beaten after falling behind. After a short period of "silence", it released the UNI airdrop. According to Uniswap's official introduction, the initial supply of UNI is 1 billion, 60% of Uniswap community members hold, 21.51% is allocated to team members, 17.80% is allocated to investors, and 0.69% is allocated to consultants. Among them, 15% (accounting for 15% of the total supply) allocated to community members have been allocated to past users. The snapshot time is September 1st, UTC time. It is almost everyone can receive the sunshine, I have to say that Uniswap deserves to be Industry leader, proud enough.

This wave of airdrops has indeed ignited the DeFi fire again, and the congestion of Ethereum is the best witness. But issuing platform tokens is not a new way to play after all. After the excitement, it is still unclear whether it will continue to rise or be a feather. Speaking of innovation, the same as SashimiSwap mentioned above is aimed at SushiSwap liquidity SwapX. It is a bit interesting. The Pair Token has been launched. Recently, many communities have seen someone in Amway DEX, and there are many media reports in the circle. Among them, the well-known blockchain media Decrypt conducted a detailed analysis of the SwapX model.

According to media reports, SwapX has made greater innovations in the SushiSwap model, and launched the Pair Token, that is, "LP Token pledged mining + Pair Token holding mining + platform governance coin SWP mining", This is SwapX's "three consecutive mining, two coins in one mining". In this mode, users can capture more revenue. Specifically, users can obtain SWP incentives in SwapX Staking with Uniswap, SushiSwap, and Balancer LP Tokens. This is the first mining. When users migrate liquidity to SwapX or add liquidity directly to SwapX, they can obtain Pair Token. This is the second mining incentive. Users can get SWP again after transferring the Pair Token to their own wallet. This is the third mining incentive. During this mining process, users get SWP and Pair Token. currency. From this point of view, the fledgling SwapX can be regarded as the subversive who dares to completely dismantle Uniswap at present. This is like the honey badger called "Flathead Brother". Although the size is weak, he dares to challenge the strong.

Regardless of the model, let's compare Uniswap's UNI and SwapX's SWP. The overall pass model of UNI is pre-mined (distributed to users), 40% of which are given to stakeholders such as the team and investors. A total of 400 million UNIs. The concentration of chips in the hands of a few people means that once big players sell , The price must be overwhelmed, which is why everyone chooses to sell immediately after the airdrop. The SwapX team adopted a decentralized approach without pre-mining, leaving all the platform governance currency SWP to community participants. The rise and fall of the currency price is determined by the market, which is more fair to users. In addition, the total issuance of SWP is 5.76 million and will never be issued again. Using the deflation model of repurchase and destruction, there will be fewer and fewer SWPs on the market in the future; and the initial supply of UNI is 1 billion, and it will be adopted later Staking’s additional issuance will increase the number of UNIs. When the actual application and circulation are in short supply, the price of SWP will increase. On the contrary, if the supply exceeds demand, the price of UNI will decrease. The most important point is that UNI does not have a flow pool on Uniswap, which means that UNI does not have any use channels and cannot capture value. It is useless except for selling and speculation. SWP not only has a five-fold mining pool of SWP/USDT on SwapX, but also creates SWP/USDT and SWP/ETH liquid pools on Uniswap and Balancer.

During the exchange with SwapX community volunteers, I got two more interesting news. SwapX was plagiarized on September 15 and attacked on September 16. It seems that although this new player has been online soon, it has caused market concerns. attention.

Since Compound ignited the flames of liquid mining, DeFi and even the entire cryptocurrency market have become lively due to the "rich-making effect" brought about by liquid mining, but not every car leads to the freedom of wealth. It is inevitable that there will be overturns, just like the Bakery mentioned above, and the DeFi tokens have continued to fall recently. There has also been a voice in the market that the DeFi boom will pass. This time Uniswap launched UNI to reignite liquidity mining. Stimulating the nerves of the market, the DeFi fire has started a prairie fire, and the market volume will continue to expand. As the traffic dispute is intensifying and the competition among the major DEXs is escalating, imitations who have rushed to go online are destined to be short-lived. Only DEXs like SwapX that are truly innovative, stable and continue to give back to the community and users can successfully counterattack.

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Is there a website where you can compare APY for top pairs between uniswap and sushi?
@tipu curate 2 :)

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sources: leading crypto sites as well as various defi analysis