QuickSwap is a fork of Uniswap that aims to improve upon the shortcomings of current decentralized exchanges (DEXs) and automated market makers (AMMs). The user experience is nearly identical to Uniswap. However, the difference is that Uniswap is deployed on the Ethereum blockchain, while QuickSwap is built on the Polygon network.
QuickSwap: A Layer 2 Protocol on Polygon
Ethereum was the first platform to enable the creation of decentralized applications (dApps) and smart contracts. This caused Ethereum to enjoy a huge influx of protocols and projects to be built on top of it. At the same time, this influx also made the network at times very congested. It resulted in delayed transactions and made the platform expensive for deploying dApps and smart contracts. Since most decentralized exchanges facilitate ERC-based token trading, even small transactions were time intensive and costly. Ethereum-based AMMs, on the other hand, use liquidity provider funds to facilitate token swaps, which are also subject to skyrocketing fees.
In order to counter the issues surrounding the Ethereum network’s scalability and TPS rates, various layer 2 solutions have come up in recent years. One of them is Polygon, which uses a proof-of-stake (PoS) consensus algorithm to finalize transactions on the Ethereum mainnet. With PoS, Polygon has managed to achieve over 65,000 transactions per block and costs only a few cents. Moreover, dApps built on Polygon are compatible with the Ethereum blockchain network.
QuickSwap is also a dApp deployed on Polygon, and is capable of facilitating Ethereum-based token trading. It allows users to trade any ERC-20 token and list any of these tokens on QuickSwap to offer liquidity to liquidity pools.
Is QuickSwap a Good Investment?
- Near-Zero Gas Fees: While Ethereum’s gas fees aren’t as high as they were two months ago, users still find them costly. Besides, until Ethereum’s transition to PoS is complete, the network will continue to face issues regarding low scalability and costly transactions. As QuickSwap is based on the Polygon network, it allows users to store, transfer, and use Ethereum tokens at a near-zero cost.
- High Scalability: Most blockchain networks, including Ethereum, are not yet ready for mass adoption because they cannot scale to support a massive number of transactions and users at particular times. QuickSwap makes use of the Polygon network, which solves these issues and achieves scalability by taking the load off the Ethereum mainnet blockchain. It incorporates an in-built Plasma technology to process transactions off-chain before sending them to the Ethereum network, thereby offering high throughput to the QuickSwap users.
- Cost-Effective Substitute for Yield-Farming: Yield farming refers to earning yield (or interest) for borrowing and lending, and Ethereum-based yield farming has its unpleasant attributes, like gas fees. However, transactions on QuickSwap on the Polygon network cost only a fraction of the cost. This is why QuickSwap makes for a compelling, cost-effective layer 2 solution for earning yield on crypto investments. Moreover, this further boosts its DeFi use-case for those that do not want to pay high fees for relatively small transactions.
What is QUICK Token: QuickSwap’s Native Token
QUICK is the QuickSwap governance token. The platform aims to provide its community members with their own virtual currency as a reliable and secure instant payment alternative to fiat currencies to carry out transactions. It is an ERC-20 token that is interoperable with other Ethereum-based tokens and can be bought via the QuickSwap platform with ETH or other tokens, or can be rewarded to LPs for providing liquidity.
Currently, the platform rewards LPs with a 0.3% transaction fee. This fee is further divided between LPs and QuickSwap’s liquidity pool, Dragon’s Lair.
Since QuickSwap is deployed on Polygon, which uses a PoS model to reach consensus, QUICK token holders get to stake their tokens for a particular period to generate yield. Furthermore, Quick holders can use their tokens to vote for changes or to make modifications to various proposals relating to the QuickSwap exchange.
Compared to other Ethereum-based DEXs or AMMs, Polygon-based QuickSwap facilitates token swaps at a much faster rate and affordable cost. Due to its high scalability and ability to facilitate cost-effective transactions, the platform has become a go-to source for users looking to trade ERC-based tokens without going through intermediaries. Despite being just a few months old, QuickSwap’s Total Value Locked (TVL) is close to $1 billion, which proves the crypto community accepts and adopts community-governed, affordable, and scalable platforms that also enable users to earn a high yield on their holdings.
While the platform has achieved a lot within a short timespan, it operates in a very competitive space. As it evolves and grows in popularity, it will attract multiple users worldwide, and only until then will QuickSwap be put to the test whether it can handle large amounts of transactions or not.