Understanding and improve a decentralized exchange.
What is a DEX?
DEX stands for “decentralized exchange”, which is a platform that allows users to buy and sell tokens without the need for a centralized intermediary such as a bank or exchange company.
To make this possible, liquidity providers are needed, which are users who provide liquidity by depositing their tokens into pools to get rewards issued by the platform.
The fees generated by the trading volume on the DEX will be the revenue for the platform.
VVS - The Leading Exchange On Cronos Chain
Despite only selecting the top performing pairs from the main DEX on the Cronos Chain, in most cases the fees are lower than the emissions dedicated to liquidity providers, resulting in a loss for the protocol.
Furthermore, it should be noted that in the few profitable pools, sustainability was only achieved due to a 96.7% token devaluation since the launch of VVS.
This not only harms the project’s reputation, but also makes it difficult for it to grow, as sustainability will decrease as the price increases.
Situation that is common in all DEXs except Uniswap, not because of its expiring license, but solely due to its large following which cannot be reached by a simple DEX fork.
How We Do It
For these reasons, instead of creating multiple unsustainable pools, we will only be accepting USDC, our governance tokens and those of our partners on AegisDOE DEX.
This approach will prevent the inefficient fragmentation of liquidity that has been observed on the Cronos Chain between MMF and VVS, leaving it entirely to VVS Finance, in which we trust for success.
In conclusion, the main source of losses in DEXs; their governance token liquidity farm, which is the most risky and therefore must be the most rewarded.
However, in the case of AegisDOE, the Dominance Oriented Economy will gradually increase its owned liquidity, reducing the costs dedicated to that pool to zero.
When Full DEX?
Our masterminds and development team are working on a completely new system for a sustainable and efficient decentralized exchange, yeah, efficiency is also the key.
DeFi world must recognize that evaluating protocols based solely on their TVL is not enough; rather we should consider their efficiency, which can be measured by calculating profits relative to TVL. This approach is essential for ensuring the long-term success of the DeFi environment.
The release date of AegisDOE Final DEX is not yet defined, but it should be completed by the end of 2023. In the meantime, please prepare stablecoins to use and benefit from our platform.
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