Biswap

<p>Biswap – a trusted DeFi platform, oriented on the best experience for users by providing them with decentralized exchange opportunities and revenue tools. We are constantly striving to develop the best DeFi ecosystem and are excited to reveal more details of the upcoming release of V3 AMM implementation. This is a significant milestone for Biswap, as it will bring new benefits for its users, including improved liquidity provision and a better trading experience. Our team has been working hard to present high-quality and profitable functionality for Liquidity Providers and traders, with competitive advantages and simple usage.</p><p>Biswap has already accomplished a range of important releases, such as <a href="https://perp.biswap.org/BTCUSDT?utm_source&#61;blg_SMM&amp;utm_medium&#61;ED_article&amp;utm_campaign&#61;ammbenefits6823" rel="noopener noreferrer nofollow">Perpetual Trading</a>, a <a href="https://biswap.org/?utm_source&#61;blg_SMM&amp;utm_medium&#61;ED_article&amp;utm_campaign&#61;ammbenefits6823" rel="noopener noreferrer nofollow">Multilingual Website</a>, and a <a href="https://blog.biswap.org/?utm_source&#61;blg_SMM&amp;utm_medium&#61;ED_article&amp;utm_campaign&#61;ammbenefits6823" rel="noopener noreferrer nofollow">Biswap Blog</a>. And now we are on the stage of great changes and opportunities. New AMM is a requirement of market trends and, more importantly, an effective solution for liquidity utilization. The upcoming release is an essential part of the Biswap roadmap and will entail a number of improvements for the project and elevate its positioning among DEXs on BNB Chain.</p><p>In this article, we want to disclose a core idea of Biswap AMM V3, its benefits, and future opportunities on the platform. More detailed information, guides, and documentation will be published along with the release. We encourage you to read this article to be aware of the fundamental changes and be ready for an early migration to V3.<br /></p><react-video url="https://youtu.be/zYQS2jyzIS0"></react-video><p></p><h2 id="header-0">What is AMM V3 on Biswap?</h2><p><img src="https://static.biswap.org/blog/1688250191518.png?w&#61;3840" /></p><p><a href="https://blog.biswap.org/article/what-is-an-automated-market-maker-amm-and-how-does-it-work" rel="noopener noreferrer nofollow">Automated Market Maker (AMM) </a>is a fundamental aspect of the DEX structure that uses algorithms to provide automated trading on the platform within liquidity pools. Through the DEX&#39;s development, the AMM functionality changed as well.</p><p>Biswap DEX is ready for a crucial upgrade through the transition from AMM V2 to AMM V3. What is the difference between these two versions?</p><p>AMM V2 liquidity is distributed uniformly along the price curve between 0 and infinity. It means a significant liquidity share is rarely used, as most crypto assets usually trade within a certain price range.</p><p>In contrast, V3 allows Biswap Liquidity Providers to concentrate their capital on particular price intervals by setting a price range. If the determined range matches or intersects with the interval where most of the trading activity occurs, your liquidity will bring you up to 4000x more capital efficiency than V2.</p><h2 id="header-1">Biswap V3 Benefits</h2><p><img src="https://static.biswap.org/blog/1688250237992.png?w&#61;3840" /></p><p>The upcoming upgrade to AMM V3 is a necessary step for Biswap ecosystem development according to its strategy. V3 implementation will positively impact the Biswap platform, its users, and the entire DEX world.</p><ul><li>Effective liquidity distribution</li><li>Reduced slippage and impermanent loss</li><li>Increased TTV &amp; TVL</li><li>Increased number of investors, new users, and partners</li><li>Development and expansion of the Biswap ecosystem</li></ul><h2 id="header-2">New V3 Era for Liquidity Providers on Biswap</h2><p><img src="https://static.biswap.org/blog/1686210761375.png?w&#61;3840" /></p><p>Liquidity is a DEX’s oxygen, and Biswap made special efforts to create favorable conditions for Liquidity Providers. AMM V3 is about liquidity optimization that will lead to income maximization from liquidity supply. Take a look at the new opportunities.<a href="https://biswap.org/pool?utm_source&#61;blg_SMM&amp;utm_medium&#61;ED_article&amp;utm_campaign&#61;benefits062923" rel="noopener noreferrer nofollow">biswap.cc/3r8QVvf</a></p><ul><li><strong>80% LP rewards from 2 trading directions</strong>Liquidity Providers will receive 80% LP (V3) rewards instead of 75% (V2) from trading fees for regular swaps and limit orders in two tokens user provided liquidity for. Consider that future Biswap LP rewards will be up to 20% higher LP Rewards among V3 DEXs on BNB Smart Chain.</li><li><strong>Automatic participation in Farms</strong>Spend less time and funds to launch one more source of income. Users become Farm participants automatically once liquidity is provided to the pool with active rewards.</li><li><strong>Personal calculations of APR’s</strong>This feature will be implemented within some time after AMM V3 release, so you will be able to see the individual share of profit from the pool instead of general APR indicators like it was in V2.</li><li><strong>Capital efficiency</strong>The possibility of increasing the capital efficiency of investments up to 4000 times compared to the V2 protocol by narrowing the price range.</li></ul><p>&#x1f4cd; Take into consideration:</p><ul><li>trading fee for regular swaps will be distributed in the following way: 80% will go to Liquidity Providers, 10% to the Team, and 10% to Treasury, a fund for future BSW lock and burn instruments;</li><li>trading fee for limit orders will be distributed in the following way: 80% will go to Liquidity Providers, and 20% will go to the Team.</li></ul><h3 id="strong-concentrated-liquidity-strong"><strong>Concentrated Liquidity</strong></h3><p>Concentrated liquidity<strong> </strong>is a type of liquidity for a particular asset that is concentrated in a specific price range instead of being spread across various venues.</p><p>Such liquidity distribution will create a number of advantages for Biswap users. Liquidity providers will be able to increase their capital efficiency from deposited crypto. Impermanent loss in AMM V3 will have much lower impact in comparison to V2. Impermanent loss refers to the temporary loss experienced by liquidity providers when the value of their deposited assets diverges from the value of the same assets held outside the liquidity pool. By narrowing the price range, liquidity providers can minimize the exposure to impermanent loss, thereby preserving a greater portion of their capital. Of course, it depends on users&#39; strategy, range size, and other factors. But the principle is that the more narrow the price range Liquidity Provider set, the less exposure to the impermanent loss! For traders, concentrated liquidity can result in enhanced trading processes with better fees and decreased slippage, even in pairs with relatively low trading volume.</p><h3 id="strong-active-liquidity-strong"><strong>Active liquidity</strong></h3><p>Active liquidity is a liquidity that brings profit for Liquidity Providers once the set range matches or intersects the price diapason where most trades occur, resulting in higher capital efficiency and profitability.</p><h4><strong>#1 Example</strong></h4><p>You are providing liquidity in the BSW/USDT pair. Let&#39;s say the BSW price is 0.25 USDT. You have provided 1000 USDT and 4000 BSW (~$2000), then you have set a price range for BSW/USDT of &#43;50% to -50%.</p><p>It means you will receive a commission when the price ranges from 0.125 USDT to 0.375 USDT per 1 BSW.</p><p>If, for instance, you want to lock the LP for 30 days, your APR will be 20%. You will earn rewards as long as the price stays within the specified price range.</p><p>Let&#39;s take the price fluctuation within the range of 0.2 to 0.3 in our example. In this case, as an LP provider, you will approximately receive:</p><p><strong>2000 * (0.2(APR)/12) &#61; $33.3 in BSW and USDT tokens</strong></p><p>&#x1f4cd; If the price goes beyond the set range, APR will not be accrued.</p><p>&#x1f4cd; If the price exceeds the upper limit (0.375 USDT per BSW), the position will only consist of USDT. If the price falls to the lower limit (0.125 USDT per BSW), the position will fully transition to the volatile asset — BSW.</p><p>The narrower the range you set, the higher your APR becomes, as its liquidity is used much more effectively.</p><p>For example, by setting a range of &#43;100% and -100%, you will receive a 5% commission, and by selecting a price range of &#43;10% to -10%, you will receive a commission of 256%.</p><p>&#x1f4cd;Note that all the figures are conditional and provided as an example to explain how range narrowing works.</p><h3 id="inactive-liquidity-out-of-range">Inactive Liquidity | Out of Range</h3><p>Due to fluctuations, asset prices can move outside the range set by the Liquidity Provider. In these cases, the liquidity stops earning fees and becomes inactive. To start earning again, users have to rebalance the liquidity manually. It will be necessary to withdraw the inefficiency liquidity and provide it for an appropriate price range. You also can wait till prices go back to the previous level.</p><h3 id="nft-lp-tokens">NFT LP Tokens</h3><p>Once you become a Liquidity Provider on V3, you will receive an NFT LP instead of LP tokens,<strong> </strong>which keeps all the data and generated fees of the provided liquidity. This NFT LP is a separate smart contract that proves your participation in the liquidity pool, but you don’t need to stake it in order to participate in V3 Farms.</p><h3 id="strong-capital-efficiency-strong"><strong>Capital Efficiency</strong></h3><p>Capital efficiency is a broad term for how efficiently your investment operates and returns. AMM V3 aims to increase it. Liquidity Providers have strategic placement options to increase earnings through custom price ranges even up to 4000x relative to V2 for providing liquidity within a single 0.1% price range. Note that keeping liquidity active in such a precise range is possible in case of appropriating market conditions and other factors.</p><p>As you can see, the more narrow your price range, the higher capital efficiency and more LP rewards you can expect. And wise versed, the larger the range, the lower the capital efficiency and fewer LP rewards you will receive.</p><h3 id="strong-custom-liquidity-ranges-strong"><strong>Custom Liquidity Ranges</strong></h3><p>AMM V3 allows Liquidity Providers to deploy their liquidity within their chosen price range and exert precise control over their invested capital. On Biswap V3 users can provide liquidity to a pair and <strong>set one or multiple price ranges</strong>. This way, they will apply their own strategy to earn from provided liquidity and create a liquidity pool for users to trade with. Each position is subject to a distinct and customizable set of parameters determining its value and rewards.</p><h3 id="strong-multi-tier-fees-80-lp-rewards-strong"><strong>Multi-tier Fees &amp; 80% LP Rewards</strong></h3><p><strong><img src="https://static.biswap.org/blog/1687787181735.png?w&#61;3840" /></strong></p><p>Biswap will offer several fee tiers for liquidity pairs, which we will analyze in detail below. Fees will be paid by users who make swaps. These fee tiers allow Liquidity Providers to select the pools according to the risk they are willing to take. When users swap within the commission that you set for your pool, you will get an 80% LP reward from it in two tokens you provided liquidity for. The closer your range to the current price, the higher rewards you get.</p><h2 id="header-3">V3 Farms Benefits | Low Network Fees &amp; One-click Participation</h2><p>Biswap V3 <a href="https://biswap.org/pool?utm_source&#61;blg_SMM&amp;utm_medium&#61;ED_article&amp;utm_campaign&#61;benefits062923" rel="noopener noreferrer nofollow">Farms</a> is one of the most important advantages of AMM V3. Why is it beneficial?</p><ul><li>Automatic participation</li><li>Personal APR&#39;s</li><li>Rewards in BSW</li><li>Passive income</li></ul><p>Once you become a Liquidity Provider on V3, you don&#39;t have to pay a transaction fee and take extra actions to launch the Farm. As we mentioned, there won&#39;t be a need to deposit LP tokens. Farms&#39; activation will happen immediately when the user provides liquidity to the pool with active rewards and their range matches the current prices.</p><p><strong>For example:</strong></p><p>Users provide liquidity to the BSW-BNB pool and can choose among these fee tiers: 0.015%, 0.08%, 0.28%, and 1%. One of them has active Farm rewards. Once users supply liquidity to the pool with a fee tier with active rewards, they will receive profit from Farms.</p><p>The Biswap team will decide which fee tier will have active rewards according to the market and platform internal analysis. They may change their decision according to the strategy and market tendencies.</p><h3 id="farm-profit-calculation">Farm Profit Calculation</h3><p>There will be 2 types of APRs that will represent your share of profit.</p><p><strong>General APR </strong>is the APR calculated on the basis of the entire pool. This type of APRs will be shown immediately after the AMM V3 release.</p><p><strong>Personal APR</strong> is an APR that is dynamically calculated according to the user’s range. This feature will be implemented in the next iteration since, for the development of this APR, more historical data and more positions are needed.</p><h2 id="header-4">Transferring Liquidity from V2 to V3 Protocol</h2><p>After the new AMM implementation, a transition from V2 to V3 will take place. Biswap has a few-click migration. Here is the detailed <a href="https://blog.biswap.org/article/how-to-migrate-to-v3-simple-guide" rel="noopener noreferrer nofollow">guide</a>.</p><h2 id="header-5">New V3 Experience for Traders</h2><p>AMM V3 will ensure an enhanced trading experience for all Biswap users. It will be cheaper, more profitable, and more flexible! Limited orders, multiple fee tiers, regular swaps, and auto routes will result in greater revenue for traders.</p><h4><strong>Limit orders</strong></h4><p>Biswap AMM V3 will offer <a href="https://biswap.org/limit?utm_source&#61;blg_SMM&amp;utm_medium&#61;ED_article&amp;utm_campaign&#61;benefits062923" rel="noopener noreferrer nofollow">limit orders</a> as a trading tool. A limit order allows traders to set a price to buy and sell cryptocurrencies. Only if the market price of your crypto reaches the limit price an order will be executed. For example, Kate wants to sell BNB, placing her position in the 300-310 USDT price range.</p><p>When the price exceeds the price range of 310 USDT per BNB, the limit order will be considered to have worked at an average price of approximately 305 USDT.</p><p>&#x1f4cd; It is important to note that such limit orders are “two ways”. If the price is below 300 USDT per BNB, the order will be active again and contain BNB.</p><p>Unlike other V3 protocols, on Biswap, you do not need to track the price relative to your position. You can add liquidity to a specific price, and this liquidity will be “one way”.</p><p>For example, Kate decided to sell BNB for 305 USDT per BNB. She places a limit order at this price. If the price reaches 310 USDT and then returns to 300 USDT, Kate can still withdraw her USDT regardless of the current price.</p><p>This new feature also allows the following:</p><ul><li>swap at the 0% trading fee;</li><li>buy/sell crypto at the most beneficial price;</li><li>no slippage.</li></ul><h4><strong>Lower Slippage for Regular Swaps</strong></h4><p>Concentrated liquidity will reduce slippage, as more liquidity will be allocated at specific price points. This way, regular swaps will experience less price impact as crypto in the pool are supplied with more liquidity.<a href="https://biswap.org/swap?utm_source&#61;blg_SMM&amp;utm_medium&#61;ED_article&amp;utm_campaign&#61;benefits062923" rel="noopener noreferrer nofollow">biswap.cc/433GgPp</a></p><h4><strong>Auto Router</strong></h4><p>Auto Router allows users to make large trades faster with the most beneficial prices. It is possible because of an enhanced Biswap trading engine through route optimization that utilizing all possible liquidity in the V3 and V2 protocols.</p><h2 id="header-6">Closing Words</h2><p>Get ready for migration to AMM V3 and experience new opportunities! This step, according to Biswap&#39;s roadmap, plays a crucial role in the forward growth and strengthening of the entire ecosystem. It will be a great pledge of possibilities for our community, partners and team.</p><p>Stick with Biswap to not skip a spectacular day of AMM V3 release! You are the witness of the historical momentum in Biswap development. More information will be published later!</p>

Meet Biswap V3 | Effective & Profitable DEX on BNB Chain

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Biswap DEX

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