Decentralized Finance (DeFi) has been a hot topic in recent months as new protocols and solutions are being launched to the market for users to get access to some of the most innovative and exciting crypto-related platforms. RSK is not lagging behind.
RSK announced the official launch of RskSwap, an automated market makers (AMMs) platform that allows users to swap ERC20 tokens instantly. This decentralized exchange relies on mathematical formulas that allow it to set the price of the tokens that are being swapped.
The fee they charge is currently at 0.3% and it can be used by liquidity providers to lock their tokens on Uniswap and get revenue from them. This would allow traders and liquidity providers to get an extra source of income with a new set of tools provided by RskSwap.
By using token swaps, users can easily exchange their currencies without depending on centralized cryptocurrency exchanges. However, decentralized cryptocurrency exchanges and platforms usually have low liquidity and are not the most efficient options to date.
Nevertheless, by using RskSwap, it is possible to have much more liquidity in decentralized exchanges. The new platform is fully decentralized considering there is no centralized control of it and it is permissionless.
The platform was created as a fork to the Uniswap V2 Protocol, which is currently one of the most popular and used decentralized exchanges (DEX) on the market. Running on top of Ethereum, it is helping the entire DeFi market to grow and offer new solutions to users.
Understanding the RskSwap Platform
Users will have the possibility to swap their tokens in a fast and easy way through an intuitive platform with a clear interface. It will be just as simple as specifying an input amount and the protocol will be calculating the number of funds they will receive back.
The funds will be transferred immediately to their wallets by using the RskSwap decentralized application with a Metamask wallet installed. Take into consideration that the fees are going to be paid using the RBTC digital asset.
Developers and blockchain firms can easily list their ERC-20 token on the RskSwap platform without even asking for permission (that’s why we claim this is permissionless). Each of these tokens will be connected to a liquidity pool and smart contract. Users will be able to trade that token and / or contribute to the liquidity pool, which will provide a fee of 0.3%.
At the same time, every single time that a new pair of tokens are contributed to RskSwap liquidity pools, those that contributed to it will receive an ERC20 token related to this pool. These tokens can also be exchanged and used. Once the funds are reclaimed from the pool, the pool tokens will be burned.