Initially, SnowSwap will be deployed on the Binance Smart Chain (BSC) to benefit from the thriving ecosystem and unique functionalities of the chain. At a later stage, the platform is expected to expand to other chains like Polygon, Solana, and Fantom.
Decentralized exchanges (DEXs) have had quite the run in 2020. Following the DeFi boom, popular DEXs on almost all blockchain networks reported record trading volumes and market caps rises. What’s impressive is that DEXs started out just as alternatives to centralized exchanges (CEXs). Over time, because of their decentralized nature and unique use-cases like yield farming, they managed to make a mark of their own in the world of crypto.
Since May 2020, the total volume locked in DEX protocols saw tremendous growth from under $1B to $88B at peak. In September 2020, Ethereum-based Uniswap became the fourth largest crypto exchange by volume displacing CEX giant Coinbase. Each blockchain network now has a popular DEX (Pancake Swap on Binance, QuickSwap on Polygon, Serum on Solana) that’s continuously growing in terms of volume and market cap. It seems like DEXs are finally getting the recognition they deserve. Yet, the crypto exchange sphere is still dominated by CEXs.
The Unending Dominance of CEXs
Features like ease of use and the convenience of Web2 on CEXs are favorable to traders. But, above all, the fact that they allow for multi-chain token trading keeps them on the top. DEXs, although individually successful, are limited to a single blockchain. Even if they support cross-chain swaps with the help of bridges, the process is often not straight enough for most to understand. This gives traders a hard time as they have to switch between platforms.
Being limited to a platform also causes problems like congestion, heightened transaction times, and high gas fees during peak trading hours. Apart from this, each individual DEX and DeFi token listed on these DEXs miss out on a whole ecosystem of traders that is being built outside their native blockchain. To solve these problems and to truly compete with CEXs, what we need is a multi-platform DEX like SnowSwap.
SnowSwap – the DEX of the Future
SnowSwap is a next-generation multi-chain AMM DEX platform that aims to solve the problems faced by popular DEXs today. In terms of functionality, SnowSwap is similar to other DEXs, but the fact that it is multi-chain makes it a notch higher. This multi-chain functionality of SnowSwap can open a world of new possibilities not just for traders but for DeFi projects too.
The traders on this platform can benefit from low transaction fees, higher transaction rates, and ease of trading cross-platform tokens. On the other hand, DeFi projects can expand the reach of their token, introduce their project to new ecosystems, and benefit from the functionalities of many different chains.
The platform prioritizes liquidity above all and aims to provide aggregate fragmented liquidity from AMMs of different platforms for its users. With decentralized yield farming and smart lock and release mechanisms, liquidity providers can reap rewards in the most efficient way.
Initially, SnowSwap will be deployed on the Binance Smart Chain (BSC) to benefit from the thriving ecosystem and unique functionalities of the chain. At a later stage, the platform is expected to expand to other chains like Polygon, Solana, and Fantom.
The cherry on the cake, however, is SnowSwap’s utility token $SNO. The token is designed such that long-term farmers, stakers, liquidity providers, and holders of SNO can hugely benefit from its tokenomics. 60% of the transaction fees will be split between holders and liquidity providers, giving them the opportunity to earn a sustainable passive income. With a selling fee of 5%, the platform encourages users to hold the token and build a long-term sustainable liquidity system. The token follows a deflationary mechanism where a specified percentage of tokens are burnt with every transaction, decreasing the supply and increasing value.
Along with yield farming and staking, the token is also designed to be used in some unique use-cases like lottery games, predictions, and SnowSwap collectibles (NFTs). With all these use-cases, SNO is the center around which the entire SnowSwap ecosystem unfolds, sustains, and grows. The total supply is capped at 1B SNO.
Crosschain Is the Future of DEXs
The success of centralized exchanges, among many things, lies in the fact that they facilitate multi-platform trading. DEXs are catching up on the success but their fundamental nature of being limited to a single platform hinders mass adoption significantly. This is where multi-chain DEXs like SnowSwap could really make a difference. By facilitating cross-platform trading of tokens, multi-chain DEXs could really compete with CEXs and become the tipping point for mass DEX adoption.
