Swaap Protocol — the first market-independent automated market maker (AMM). It uses a combination of oracles and a dynamic spread to provide consistent returns for liquidity providers and lower prices for traders.
Brief information about the Swaap Protocol project
Swaap Protocol greatly reduces arbitrage trading, a phenomenon in which external participants extract value from a pool, using price differences in the market. The value, saved from arbitrageurs, is shared between traders and liquidity providers (LPs). Liquidity providers gain access to profitable and sustainable market creation strategies. The protocol greatly reduces intermittent losses and offers multi-asset pools.
At Swaap, developers are looking to democratize DeFi because they believe it is better than a centralized financial system. The platform significantly reduces non-permanent losses while remaining neutral to the market. This means that the amounts of assets in the pool always remain close to their original distribution.
To avoid potential bugs or malicious attacks on oracle values, Swaap uses two mechanisms:
| 1 | If reserves are not balanced by more than 2%, trading is suspended, which prevents too much production in case of incorrect data. |
| 2 | If the oracle is not updated at the required point in time, the trading of the specified asset on the platform is interrupted. |
Swaap uses oracles to calculate the average price of assets, traded on the platform. The oracles are provided by Chainlink (price feeds), the most secure oracle provider. Oracles are updated every 27 seconds on the Polygon network, which allows Swaap to significantly reduce the possible arbitrage on the platform and distribute this value among both LPs and traders.
Swaap token
Swaap aims to be a public and decentralized protocol. The command will use the token to control the protocol. The token will not be launched until the protocol reaches a certain level of maturity. The tokenomics of the protocol has not been determined yet.
The token has not been launched yet, but you can already start collecting it. By connecting to Swaap pools, you are eligible for future token rewards (when the token is released). It works like a liquidity mining program, but is retroactive. The amount of tokens you can collect will depend on both the amount of deposited liquidity and the time frame, so you'd better get started right away.