One of, if not the most important issues ongoing in Decentralized Finance (DeFi) is that of liquidity and what can be done to help fix the underlying issues of liquidity and accessibility. Autonio’s Smartdex 2.0 combats both of these issues through aggregation of liquidity pools as well as facilitating cross chain swaps and bridging. Tokens need high liquidity in order to be traded without the user losing out on tokens or money due to having a large price impact on the pool or not knowing where to get the best price when there are hundreds of decentralized exchanges out there.
A cross-chain swap is an exchange of tokens across two different blockchains without the need for an intermediary or middle-man to the do exchange and are completed through smart contracts. This function of cross-chain swaps will act as a boost to the DeFi market as users will be able to easily interact with chains in which they have not used or discovered.
While layer 2 protocols and new, more efficient, blockchain protocols have been developed and helped with the transaction costs, it has exacerbated the issue of liquidity fragmentation. Now, more than ever, tokens may have fifty different liquidity pools spread across different blockchains, exchanges, and protocols. Some exchanges or blockchains may not even have the token you are looking for. Cross-chain swaps help solve this problem.
Utilizing the underlying infrastructure of some protocols and blockchains, we can aggregate liquidity across exchanges and get the user more for their money. This means that if there is a token that you would like to purchase on ETH but it has much higher liquidity on Polygon or BSC as the project moved to layer 2, as many have done, you may be getting a worse deal on your money without knowing it.
Cross-chain swaps and Smartdex 2.0 implement features that pool liquidity from tons of exchanges to find you the best deal. This means that when you go to buy a token on Smartdex 2.0, you don’t have to worry about searching through the fifty plus Ethereum and layer 2 exchanges to find the best price or try to figure out if it’s even on another chain. Smartdex 2.0 will even show you if you can get a better deal by buying it on Polygon, BSC, and soon even other protocols and blockchains.
Any sort of savings adds up for regular users, even big traders. If you can save even fifty or a hundred dollars on a transaction due to finding a better deal on another chain, why wouldn’t you, especially if you are making multiple trades each day or even each week. Cross-chain swaps are here to help users of DeFi, especially new users who aren’t as versed in the space, learn how to make proper trades and find the best deals.
If you’d like to learn how to easily use cross-chain swaps, try out our Smartdex 2.0 beta release
Have fun and happy trading from Autonio!
