Launched in Q4 of 2020, Sifchain is a fresh face in the fight for better implementation of cross-chain integration in the blockchain space. While still early in development, Sifchain is incredibly ambitious and plans to create a platform that solves a long-standing problem of decentralized exchanges (DEXs): interoperability.
Sifchain is the world’s first omni-chain decentralized exchange (DEX) built with the Cosmos SDK. While Sifchain currently has active connections to the Cosmos Ecosystem and the Ethereum ecosystem, this is merely a stepping stone as they look to incorporate up to 25 blockchains for cross-chain integration. At this time, users within Sifchain can import and export tokens from Cosmos-based projects like ATOM, JUNO, AKT, OSMO, while also being able to import and exports tokens from Ethereum-based tokens like ETH, USDT, USDC, and much more. Within the Sifchain DEX, all of these tokens can be easily swapped for each other at extremely low fees and at fast speeds.
However, Sifchain has much more planned than this initial offering. Let’s look at the company itself, its platform, and why you should not only look into what they are up to now but also keep an eye on them in the future.
What Sets Sifchain Apart?
The Sifchain DEX is a low slippage omni-chain solution with more substantial LP rewards than other competitive exchanges. User’s have their choice in adding to any of the 90+ liquidity pools currently listed on the DEX, and earn at least 100% APR in doing so.
The Sifchain platform has extensive cross-compatibility with other DEXs and centralized exchanges, allowing for liquidity across numerous chains – this will ensure users don’t have to pay hefty fees or partake in complex trading structures.
Their exchange runs on the Cosmos Software Development Kit, making it compatible with other Cosmos Network blockchains like Juno, Akash, and Terra. They are also the only Cosmos-based DEX where users can quickly swap Cosmos assets for ERC-20 tokens at a low cost.
Running on the Cosmos Software Development Kit will also make Sifchain 100 times more efficient than Ethereum-based DEXs, meaning that users will experience extremely fast transaction speeds when executing swaps.
Why Sifchain Now?
Sifchain has been very busy as of late. They recently launched a program named Sif’s Expansion: aimed at rewarding liquidity providers with rewards for providing liquidity to the DEX. All pools within the DEX will earn a minimum of 100% APR, with a handful of voted on pools earning a minimum of 300% APR. There are also a few unique characteristics to the program:
1) As more liquidity is added, it does not negatively impact the APR. These APR percentages are minimum and stable. Meaning that as more people join into the pool, the more people that will earn these lucrative rewards. It does not matter if it is 1 person in the pool or 1000 people in the pool. All LPers will earn the same reward APR.
2) Sifchain offers Impermanent Loss Mitigation. A fear of potential LPers is that they will be exposed to impermanent loss. But, with Sifchain’s Sif Expansion, if a user realizes IL, the user will continue to earn rewards based on the realized IL amount. For example, imagine a user deposits 100k worth of assets into a Sifchain liquidity pool. Let’s say this amount drops to 80K value due to price fluctuations. The user removes all 80K worth of assets. That user will continue to earn rewards based off of the 20K worth of assets that was lost due to IL (the 20k here is called the ‘IL amount’).
The reasoning behind this program is to accumulate deep liquidity into the Sifchain DEX, while the team works on delivering their core features of Omni-EVM and Margin Trading.
Not only this, but they also offer deep rewards from staking and delegating. This is to ensure the system stays in-balance between liquidity providers and stakers/delegators.
Why Keep an Eye on Sifchain in the Future?
Everything that Sifchain is currently focused on, is to set them up for their future endeavors which have the potential in making them one of the world’s leading exchanges.
They have started their DAO formation process with the introduction of several DAO councils. These councils will start to take on responsibilities such as determining a process and procedure for new token listings and determining how delegation amounts to node validators are determined. Their plan is to spin up additional councils in the near future, the next being focused on marketing.
While Sif’s Expansion is earning their liquidity providers lucrative rewards now, they are aiming at implementing more novel and sustainable DeFi 2.0-centric programs to ensure LPers and stakers/delegators are being incentivized appropriately for their participation in the protocol.
They are also launching their coveted Omni-EVM feature, which will allow them to spin up new connections to other EVM chains in the matter of weeks, or potentially even days. This means that we will live in a world where Sifchain will be connected to 25+ of the leading blockchains like Binance, Solana, Avalanche, Cardano, Moon Beam, Moon River, and more. This will allow users to essentially move any token from any blockchain into Sifchain, swap for any other token from any other blockchain for miniscule costs, and export those tokens out to any blockchain the user desires. Simply put: true and cheap interoperability.
Sifchain is positioning itself to be everyone’s one-stop shop when it comes to swapping, providing liquidity, and staking & delegating.
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