The VeChain ecosystem is evolving and a new decentralized exchange (DEX) has recently been deployed. It’s called ZumoSwap and it aims to replace Vexchange, Automated Market Maker (AMM), and liquidity provision protocol that were introduced on the network.
VeChain Users Questions Answered
According to a blog post on December 22, the team behind the ZumoSwap solved the question that most VeChain users have to ask: Why start a new DEX when Vexchange is already operational? According to ZumoSwap, “its competitors feel something is wrong.”
Inspired by Uniswap, the most popular decentralized exchange running on Ethereum, the data provided by the team behind ZumoSwap suggests that Vexchange may collect higher fees from its users. In contrast to the standard slippage fee of 0.3% at Uniswap, Vexchange charges a fee of around 1%, which is a significant increase compared to the Ethereum protocol.
Hence, ZumoSwap was created to meet users’ needs for a “native DEX” that can offer them low-cost alternatives and multiple features. The team behind VeChain DEX claims:
“After careful thinking, we decided to get rid of ALL Uniswap + Web3 code and build from scratch. This is a VeChain project, not one of the Ethereum dApp.”
DEX should be able to integrate with “any VeChain-supplied wallet” and work through what the team calls “one-click exchange”. They claim that this will improve the DEX experience as users no longer have to perform two transactions to exchange tokens.
Many Functions of ZumoSwap
In addition to the above features, ZumoSwap will encourage VeChain users to trade, exchange their tokens and stay active. The post claimed that these activities were advised against by Ethereum and other competitors.
As a result, protocols made to facilitate transactions become less useful as users set prices through the platform. With this in mind, users will always be able to trade on ZumoSwap with a 0.3% slippage.
The platform integrates the “Auto VTHO Farming” function. This will allow users to maintain their VTHO ROI and provide liquidity for DEX by providing professional training to the mining pool. The team behind the project claimed that “no additional action is required; you can use VTHO like in your own wallet”.
This can make ZumoSwap an alternative for users who want to generate more rewards through VET and who want to stay active in the VeChain ecosystem. ZumoSwap will also work with a fee delegation mechanism and will launch ZUMO tokens in the future.
The native ZumoSwap token and its token economy will be described in the future. However, the team behind the project revealed the following information about the potential airdrop:
“It will be released in a similar manner to Bitcoin and details will be announced in the following articles. All Liquidity providers and traders and X Node holders will receive the airdrop.”