Swing and Neon EVM announced their collaboration to power cross-chain liquidity between Solana and Ethereum via EVM networks. But why is this a big deal and what ramifications does it have on the crypto ecosystem as a whole?
Ethereum was the first blockchain to incorporate the seismic smart contract functionality, and it currently processes over USD 12 billion in daily transactions. This allowed decentralized exchanges and automated liquidity pools to flourish, allowing for more fluid trading. Unfortunately, the Ethereum network faces its fair share of scalability and cost challenges as the adoption of crypto grows, thanks to its existing consensus mechanism, Proof of Work (PoW).
The Need for Interoperability — A World of Co-Existence
Solana has been labeled the “Ethereum-killer” because of similar smart contract capabilities, high throughput of 65,000 TPS, proof-of-stake consensus system, strong community sense, and relatively low gas fee. While that may be a very far-fetched claim, Solna certainly has its upsides. And despite often being considered a rival to Ethereum, interoperability between Solana and Ethereum is becoming increasingly important to the DeFi movement.
However, because Solana employs a different programming language and a different set of developer tools than Ethereum, it was not practicable for Ethereum projects to be ported onto Solana.
Neon EVM, developed by Neon Labs, aspires to be a game-changer in this regard by allowing developers to use the EVM to construct dApps and implement smart contracts in coding languages like Solidity while taking advantage of Solana’s low gas fees and low latency. With this, there’s no need to rewrite any code; the applications can be copied over directly to Solana via Neon EVM.
Another issue hindering the growth of the DeFi movement is liquidity fragmentation across different blockchain networks. Swap and Trade of tokens are one of the most important use cases in DeFi with respect to lending, staking, and trading. However, there is a stark absence of composability in swapping tokens from one blockchain to another.
The importance of cross-chain liquidity linking lies in the fact that it could unlock crypto capital pools that are otherwise unavailable. That is why an efficient cross-chain liquidity protocol, Swing, has entered the scene to pool DEX liquidity from major blockchains and aggregate the liquidity sources. With this collaboration, Swing and Neon EVM’s partnership, liquidity access across Ethereum and Solana blockchains will be achieved with the help of Swing’s cross-chain liquidity protocol. Swing users can swap crypto assets across multiple ecosystems with low slippage and secure the best prices for their swaps with the help of Swing matches.
According to Viveik Vivekananthan, Founder of Swing, the context of this collaboration stems from the fact that Solana grew up to 2800% in 2021 alone, holding enormous growth potential for investors and developers.
Where’s the Project Headed?
This partnership will allow Swing to leverage Neon EVM to enable cross-chain liquidity movement and trading between main EVM networks and Solana.
Further, Swing users will be able to access decentralized liquidity across top DEXs on Solana, including Moraswap, Saber, Raydium, Octaswap.com, Neonswap, and more, thanks to the integration of Neon EVM, native Solana assets, and other bridged assets.
The project is said to kick off this year and promises Swing users the most efficient trade route on the most efficient blockchain.
What Does The Future Hold?
Swing and Neon EVM’s collaboration may become one of the most revolutionary DeFi collaborations if it enhances cross-chain liquidity. Given the fact that the project distributes the pressure of smart contract-based crypto assets that are currently being piled on the Ethereum chain onto Solana, this may open the door to innovative crypto assets and dApps being built without fear of gas wars, and thereby, paving the way for mass adoption of crypto.
By insulating developers and investors from obnoxious Ethereum gas fees, it gives massive power to the community the autonomy and choice to trade across blockchains all the while ensuring that the benefits of Ethereum functionalities are not lost as well as maximum performance.
Further, with improved interoperability, even other assets, like NFTs and in-game collectibles, which are largely built on the Ethereum network, can port over to Solana for better accessibility to the everyday Joe.
By enabling cross-chain transactions, the project aims to bring in a new era of decentralized trading. With these features and offerings, Swing aims to be the Stripe for cross-chain transactions. Much like how Stripe enables websites and apps to take payments over their websites, Swing will simplify cross-chain swaps and transfers for developers and businesses with its much-awaited API product.
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