WigoSwap on Fantom Sees 250% increase in users
Trading platform WigoSwap is seeing an influx of users and trading volume as it launched an Initial Dex Offering (IDO) for its native WigoSwap DEX and WIGO token on February 9. The influx of capital has led WigoSwap to increase the total value locked in its contracts from $1.8 million on launch day to more than $65 million today thanks to supporters rushing in to get in early on WIGO.
With a total value locked (TVL) of $65 million, WigoSwap suddenly becomes a prominent platform on the Fantom blockchain. Its gamified burning mechanism catches attention as it opens up the possibility of forever minting new tokens and incentivizing users who provide liquidity.
As per announcements, the IDO started on February 9 on wigoswap.io. Additionally, Wigo Bank and Farms, which allow users to stake and farm on the platform, were introduced on the same day. Furthermore, a campaign was launched on WigoSwap’s social media to reward liquidity providers through an airdrop before the launch of the farms.
WigoSwap heads to the moon
The launch and the rewards had their desired effect as wallets connecting to WigoSwap grew over 253% week over week, reaching 6,250. Those wallets completed 53,310 transactions, driving more than $105.6 million trading volume through the finance application. Interestingly, an average transaction on WigoSwap in the last seven days was worth around $2,000. This is pretty steep when compared with other new platforms, generally having average transactions of a couple of hundred dollars.
As mentioned, the Wigo Farm and Bank opened the same day as the IDO launch giving holders instant utility and earning potential. The Bank allows WIGO holders to stake their WIGO to make more. At writing, the two options are auto-compounding and manual, with vastly different rates of percentage rewards available for each.
Two farms are available for holders to earn more WIGO with APRs above 1000% and 10x multipliers on both. Currently providing liquidity for Fantom’s native token FTM and the USDC stablecoin are available options. To facilitate easy, low-cost trading, the platform looks to firm up its stable and native token reserves.
What is WigoSwap?
WigoSwap is a new DeFi protocol on the Fantom Blockchain that has gained popularity by presenting a new concept known as a Gamified Burning Mechanism. The mechanism looks to address the issue of incentivizing liquidity providers, one of the biggest problems facing DeFi. Utilizing gamification, WigoSwap aims to prevent running out of Liquidity Provider (LP) rewards despite having a hard cap of two billion tokens. By this new mechanism, WigoSwap opens up the possibility of perpetually minting new tokens and incentivizing the users.
Gamified Burning Mechanism
DeFi greatly relies on liquidity providers locking crypto assets into smart contracts. This leads to the generation of liquidity pools where services such as exchanging, lending, borrowing can draw on tokens. As long as liquidity providers are consistently incentivized, the required liquidity is available. However, incentivizing liquidity providers is not easy. Transaction fees on DeFi protocols form the earnings gained by liquidity providers to a certain extent. However, more powerful incentives are required on networks such as Fantom, where transaction fees are low.
The main problem is that a DeFi protocol can mint new tokens and reward its liquidity providers only for as long as the maximum supply of the tokens is not reached. In other words, due to the existence of hard-cap, which is a significant component within every blockchain project, the option of rewarding the users will ultimately come to an end. In most blockchain projects, the burning process is limited to sending tokens to a dead address, and in effect, the tokens are not deducted from the total supply.
WigoSwap utilizes a particular type of smart contract that makes it possible to burn tokens and remove them from circulation by reversing the minting process known as de-minting. However, the de-minting approach by WigoSwap can be considered a true example of the burning process. This allows for minting new tokens in the future while benefiting from the advantages gained through the existence of a hard cap.
The roadmap states that several phases will be needed to realize a Gamified Burning Mechanism fully. In the initial stage, the burning mechanism includes the essential functions of the DEX, such as un-staking fees, swap fees, etc. WigoSwap has already announced that it will soon offer game developers on the Fantom Network the possibility of using incentive programs and IDOs on WigoSwap to develop their games using the GBM mechanic. Arguably, the WigoSwap approach could act as a long-term and stable method for the industry for years to come.
Fantom DeFi is on the up
Fantom DeFi dapps currently hold around 5% of the $200 billion total value locked in DeFi, having made massive strides forward in 2021. The network continues to impress as we head deeper into 2022, with several dapps displaying excellent growth metrics in the last seven days despite the somewhat bearish trend in crypto markets right now.
Another finance platform on Fantom on the rise is ProtoFi. A decentralized bank that offers savings accounts that continuously grow deposits by paying out interest. At the same time, allowing users to gain other returns by earning a share of all the revenue generated by the protocol through a dual token system.
Wallets connected to ProtoFi swelled over 90% in the last seven days while transactions grew to more than 2,650. While small numbers compared to more established platforms on Fantom, ProtoFi only launched a month ago, showing Fantom users’ desire for new dapp offers and the broader appeal of the Layer-1 network as Ethereum continues to struggle amidst unfavorable gas fees.
The above does not constitute investment advice. The information given here is purely for informational purposes only. Please exercise due diligence and do your research. The writer holds ETH, BTC, AGIX, HEX, LINK, GRT, CRO, OMI, IMMUTABLE X, GALA, AVASTR, GMEE, CUBE, RADAR, FLOW, FTM, BNB, SPS, WRLD, ATOM, and ADA.