If you have been into the decentralized finance (DeFi) rabbit hole for the past year or so, it is likely that the sky-high gas fees on the Ethereum blockchain-based decentralized exchanges (DEX) such as Uniswap, SushiSwap, and Bancor must have put a big dent in your pockets for token swaps.
Indeed, while the rising adoption of DeFi speaks volumes about the potential of the emerging financial infrastructure to disrupt traditional finance, it is also true that DeFi on Ethereum is still very much out of reach of the common folks as under no circumstances would it make sense for users to pay $20-30 for a mere token swap on a DEX.
In an attempt to offer users more options in terms of enabling feasible token swaps, DEXes on Ethereum Layer-2 solutions and other Layer-1’s such as Avalanche, Fantom, and Solana have risen to the occasion. The rising adoption of Layer-2 DEXes reflects in their ballooning TVL.
According to data from L2Beat, the total TVL on Ethereum Layer-2 solutions now exceeds more than $3 billion — note that this figure excludes TVL in other Layer-1’s which would likely shoot the figure even higher.
In this article, we will analyze two rising DEXes built on Polygon (MATIC) – an Ethereum scaling solution – and Avalanche.
QuickSwap is a Polygon-based DEX that allows users to enjoy lightning-fast token swaps, provide liquidity, and more at minimal gas fees.
At its launch, the QuickSwap DEX used the same code as the leading Ethereum-based DEX Uniswap which ensured the exchange was secure and battle-tested.
Notably, to execute any transaction on QuickSwap, users are required to pay gas in the form of MATIC tokens.
However, unlike DEX trading on Ethereum, gas fees on Polygon are almost negligible which ensures that small traders are able to transact and swap tokens without worrying about the gas fees.
Akin to how other DEXes work, users can exchange any ERC-20 tokens on QuickSwap as long as there’s ample liquidity for the same on the DEX. On the flipside, contrary to other DEXes on the Ethereum blockchain, providing liquidity on QuickSwap is a vastly cheaper affair where users can create a liquidity pool for under $10.
Liquidity providers on QuickSwap are entitled to receive 0.3% transaction fees from every trade while at the same time, also farm healthy yields with high APYs.
Moreover, liquidity providers on QuickSwap also stand to collect the DEX’s native QUICK token which can also be used to drive the protocol’s governance.
At press time, QUICK ranks 301 on CoinGecko and is trading at $506 with a market cap of over $183 million. The protocol has a TVL of almost $800 million, according to data from DeFi Pulse.
Pangolin is an Avalanche-based DEX that allows users to leverage the high-performance, eco-friendly, and economical smart contracts platform for rapid token swaps.
Pangolin offers a wide array of performance upgrades compared to Ethereum-based DEXes such as Uniswap in the form of facilitating cheap token swaps, enhanced network security, a simple liquidity provisioning mechanism, and even full compatibility with the Ethereum network, among others.
Unlike the vast majority of DEXes with strong VC and private investors’ backing, Pangolin was launched following the “fair launch” model where the vast majority of the DEX’s native token PNG was distributed to liquidity providers on the DEX. In addition, Pangolin also offers 0.3% of all trading fees to liquidity providers.
Most recently, Pangolin joined the highly-anticipated Avalanche Rush program with a $2 million allocation of AVAX tokens.
For the uninitiated, the Avalanche Rush program is essentially a high-scale incentive mining and airdrops program where as much as $180 million AVAX tokens from the Avalanche Foundation will be deployed across decentralized applications in the Avalanche ecosystem.
The participation in the Avalanche Rush program came shortly after Pangolin inked a partnership with Wyre to enable users to seamlessly connect their credit cards and Apple Pay to purchase AVAX tokens.
At the time of writing, Pangolin has processed a cumulative trading volume of more than $6.14 billion, hosts over $385 in liquidity in the form of various digital assets, and offers as much as 225% APY to liquidity providers.
With Ethereum 2.0 and sharding still at least a few years away, the DeFi grounds are ripe for scalable projects to foster innovation and robust features and make user experience their priority.
Both QuickSwap and Pangolin, while in different ecosystems, are committed to benefit the users from DeFi’s innovation without having to pay hefty fees.
Indeed, the future of the crypto industry is multi-chain and with DeFi being merely a 2-year-old phenomenon, the sky is the limit for all quality projects in the space — QuickSwap and Pangolin included.