The past few years have been phenomenal for the decentralized finance (DeFi) industry. The sector has recorded steady growth since the beginning of 2018. For instance, as of January 1, 2018, the total value locked across all DeFi protocols was a meager $48.51 million. Today, this value has grown significantly and now stands at a whopping $71.33 billion, representing a growth of more than 1,470 times.
One primary contributor to the explosive growth of the DeFi sector is the advent of automated market makers (AMMs). Unlike centralized crypto exchanges that use order books, AMMs are decentralized exchange (DEX) protocols that employ a mathematical formula to price assets. They allow users to swap tokens without counterparties. AMMs typically rely on liquidity providers (LPs) to keep the system running. As expected, LPs are incentivized for providing liquidity. As of press time, over 60 decentralized exchanges were competing for the top spot.
Speaking of competition, the consensus is that these protocols have exhausted the number of potential mechanisms and incentives to attract liquidity providers and engage users. Upon closer scrutiny, one would agree that most of these DEXes are simply iterations of already existing, bearing a different name without offering anything unique.
That being said, the entry of EmiSwap into the DEX space is set to change the narrative. Inspired by the existing limitations of existing protocols, EmiSwap aims to redirect liquidity from the bigger protocols to its platform by offering its users “mind-blowing” rewards.
EmiSwap claims to be “the first community-governed DEX with NFT mechanics.” It describes itself as:
“An automated market maker exchange supplemented by an ESW governance token and yield-boosting NFT Magic Cards. It is an open-source, decentralized platform, a fork of Uniswap V2.”
EmiSwap hit the market on March 31. Since then, the protocol has welcomed more than $250,000 in total valued locked (TVL). It has also successfully raised $1.3 million in seed funding for its ESW token. So far, the future is looking bright for the blockchain project. In addition to its success in attracting funding and liquidity, the protocol has passed a security test by Hacken, a leading blockchain security company.
Commenting on the value of his company, Grigory Rybalchenko, CEO and founder of EmiSwap said:
“We followed a strategic thinking process, detailed analysis of blockchain values and fees, and a variety of methods and formulas to make our offering valuable and unique. We started our company not just for the sake of starting but because we believe in its power. Today, we rest assured that our product is unique and ahead of the game.”
Incentivizing Participation
EmiSwap has deployed robust marketing opportunities to attract LPs. For one, the platform offers a 100% gas fee reimbursement for any operation, including creating a pool, swapping tokens, or providing liquidity in ESW governance tokens. This implies that every transaction executed on the platform attracts a form of compensation. Moreover, early investors have been earmarked to receive ten times more rewards, with bonuses being multiplied for the first 100 days after launch.
According to EmiSwap’s website, 30,000 ESW tokens will be distributed daily amongst LPs for each 1 million DAI trading volume from the 11th through to the 1000th day after the project launched. In addition to this, here’s a quick breakdown of some of the other benefits that EmiSwap has to offer.
- 0.25% of all transactions on the DEX will be allocated to regular LPs.
- ESW token holders will earn 0.05% of trading volume, whilst being able to participate in the governance of the ecosystem.
- Over 40,000 ESW allocated to LPs regularly.
- LPs stand the chance to win limited-edition NFT cards.
Considering the interesting growth of the NFT industry, EmiSwap’s NFT offer becomes almost hard to ignore. The chance to win NFT cards adds an extra layer to the plethora of passive income streams that already exist on the protocol.
LPs can win limited-edition NFT cards that will allow them to use the exchange, trade on several markets, and compete in special tournaments, including the prestigious Card Wars. The 1001 NFT cards comprise 1 Mythic, 11 Legendary, 40 Epic, 150 Rare, 300 Uncommon, and 500 Ordinary. These cards will be allocated to participants who surpass certain milestones.
In conclusion, EmiSwap is pioneering a paradigm shift in how LPs are rewarded for their work on AMMs. Its unique rewards and the integration of NFT cards create an ideal passive income source for token holders.
