What is SmarDex?

Decentralized finance (DeFi) is a new financial technology that challenges the existing centralized banking system. DeFi aims to reduce bank costs, remove intermediaries, boost transparency and accessibility, and promote peer-to-peer transactions. DeFi is still in its infancy, and significant challenges must be addressed before it can replace the current financial system, which has severe concerns that need to be resolved. A decentralized exchange (DEX) is critical in DeFi because it is one of the most crucial applications. DEX is a peer-to-peer (P2P) marketplace for cryptocurrency buyers and sellers. A new decentralized exchange (DEX), SmarDex, has emerged, which can propel the DeFi space forward while rendering previous DEXs obsolete. Smardex intends to overcome this issue through its proprietary algorithms and features. If you’re looking for safer DeFi activities, Smardex is one of the allowed tokens on the Kassandra Finance platform.

What is a Decentralized Exchange (DEX)?

DEX platforms allow peer-to-peer trading without controlling user cash or requesting personal information.

Alexander Osipovich, a Wall Street Journal finance reporter, said in May 2021 that decentralized exchanges “look less like the New York Stock Exchange and more like Napster, the defunct music-sharing service.”

A decentralized exchange (DEX) utilizes smart contracts that permit traders to trade without a middleman. Users own their private keys and are not obliged to provide personal information. A DEX uses blockchain technology and smart contracts to facilitate trading. Users engage directly with smart contracts to transfer tokens, removing the need for a mediator.

Facts about SmarDex (SDEX)

SmarDex, or ‘Smart Decentralized Exchange,’ is a decentralized trading platform that enables users to trade crypto assets directly without intermediaries.

It is an example of an automated market maker. This trading mechanism encourages users to offer liquidity to the market in exchange for a portion of the fees or tokens.

SmarDex operates on EVM-compatible blockchains such as Ethereum, BNB Chain, Polygon, and Arbitrum, allowing users to exchange ERC-20 tokens.

SmarDex includes a particular DeFi protocol known as the fictive reserve, which uses a unique algorithm to automatically balance swap prices, allowing liquidity providers to generate additional profits.

SMARDEX is a DeFi platform that supports everything from swapping to staking. Beyond token exchanging, Smardex provides liquidity provision, farming, and staking services. This makes it a comprehensive platform for those interested in various DeFi activities, such as automated rebalancing.

Smardex employs a specific algorithm to ensure token equilibrium in a liquidity pool. This reduces the likelihood of temporary loss while creating the potential for impermanent profit.

Currently, the project has about 15 team members playing various roles. Jean Rausis is the founder, and Eric Rable is the co-founder.

From an early age, Jean Rausis has been fascinated by computer technology, network security, and cryptography. Enthusiastic about Bitcoin for a decade and about DeFi for years, he dictates the technical vision of the SmarDex team in his day-to-day work, surrounded by an elite team of engineers.

Eric Rable is from Switzerland and runs several companies. He focuses on Blockchain, a technology he believes will be the main innovation of the coming decades.

Understanding SmarDex (SDEX)

SmarDex is a trustworthy next-generation DeFi platform that offers consistent ROIs and tangible value through unparalleled breakthroughs. It provides an affordable tool for individuals wishing to manage their tokenized cryptocurrency assets more efficiently.

Key Features of SmarDex (SDEX)

• Smart Trading: SmarDex is a smart trading platform with advanced algorithms that enable quick and efficient trading.
• Liquidity Pools: Users can use liquidity pools to supply liquidity while earning rewards for their efforts.
• Security Features: SmarDex’s primary focus is security, including features like multi-signature wallets and auditable smart contracts.
• User-Friendly Interface: The platform’s user-friendly interface makes it easy for users of all skill levels to access and use.

SmarDex Services

SMARDEX is a DeFi protocol that provides various services and allows investors to earn higher returns by lowering the danger of temporary loss while enabling the chance of impermanent gain. Let us look at the core services SmarDex provides.

Farming

Users deposit SmarDex LP tokens to generate SDEX tokens. The system creates trading fees for each pool, which benefit each yield farmer.

Depositing your LP tokens to SmarDex’s farms (e.g., SDEX/WETH, SDEX/USDT, WBTC/WETH) allows you to earn extra SDEX as a liquidity pool provider.

To begin farming, go to the Farming Tab, select the pair you want to cultivate, and click on it. At this stage, you must confirm the management of your LP tokens via the SMARDEX protocol using your Web3 wallet.

Once completed, click the “Stake LP” button to deposit your first LP amount.

Swap

SmarDex added its exchange system to the platform, which provides customers with a diverse variety of ERC20 tokens and enables them to trade without relying on CEX.

SmarDex’s structure provides lower trading fees of 0.07% (on the Ethereum blockchain) instead of the standard 0.3% fees of other automated market makers (AMMs). The trading fees obtained are divided into farming yields and staking rewards.

Certain steps must be followed to exchange transactions properly on the SmarDex platform. First, make sure you have access to the platform. Next, choose a token among several ERC-20 tokens to swap.

Then, you need to give SmarDex access to interact with your wallet. Finally, swap the required tokens on SmarDex. As a DEX, SmarDex gives you complete control over the tokens exchanged in your connected wallet.

Staking

The SmarDex platform allows traders to use the market and exchange tokens for a minimal cost. Crypto staking is a popular technique for generating passive income, and SmarDex hopes to make the process easier for you. The simple steps include:

• Navigate to the Staking Tab
• To deposit your SDEX tokens, click the ‘+’ or ‘-‘ buttons
• Manage your staking pool wisely and reap your SDEX profits

You can deposit SDEX coins from your Web3 wallet to begin staking. When you harvest part or all of your SDEX, you remove those assets from the farm and no longer earn passive income.

Liquidity

This project couldn’t pass up the opportunity to showcase its solution for providing cryptocurrency liquidity. By providing liquidity, users can help improve SmarDex’s security and functionality.

Whenever you deposit money into the liquidity pool, SmarDex will utilize it to enable AMM trades on the platform. The SmarDex protocol allows users to exchange crypto tokens and receive LP tokens.

When you deposit at SDEX, you will receive equal LP tokens. SmarDex’s fictive reserve automatically maintains the balance in reserves, reducing the risk of temporary loss. The platform’s Liquidity tab allows you to supply liquidity and manage assets.

SmarDex (SDEX) Tokenomics

SDEX, the SmarDex platform’s native ERC-20 token, allows users to access all SmarDex services and features. $SDEX plays an integral part in the Smardex ecosystem.

As of this writing, the SmarDex token has a circulating supply of 8,352,522,958 SDEX coins and a maximum supply of 10,000,000,000 SDEX coins. The SDEX/USDT liquidity pool will receive half of these tokens.

Specifically, this token can be traded, staked, or contributed to a liquidity pool. Staking and farming both provide investors with a steady stream of benefits while reducing the chance of irreparable loss.

SmarDex’s tokenomics assures a stable supply with improved purchasing power while compensating liquidity providers, stakeholders, and users. As a result, liquidity pools receive half of the 10 billion SDEX token supply. At the same time, 37.5% is allocated to long-term farming output and staking rewards.

The remaining 12.5% goes toward increasing period farming production and staking incentives. Each trade on SmarDex incurs a 0.07% cost, with 0.05% going directly to LPs offering liquidity for the trading pair and 0.02% to all stakes as SDEX incentives.

Source: docs.smardex

SmarDex (SDEX) Solution to Impermanent Loss

SmarDex handles one of the most significant concerns in the DeFi world: impermanent loss. Impermanent loss is a DeFi phenomenon that refers to a change in the price of tokens after a market player deposits them in the pool. It occurs whether the price rises or falls, and the amount of loss depends on how substantial the price fluctuation is.

When liquidity sources withdraw their money, the assets they withdraw are worth much less than those they invested. Also, farming methods might produce more tokens, throwing off the balance between supply and demand and bringing down the price of tokens.

Liquidity sources need to be aware of the short-term loss and devise ways to compensate. This will change how DeFi and Bitcoin trade will work in the future. If liquidity sources know the risks of temporary losses, they will be able to keep DeFi protocols and stablecoins liquid. Because of their work in the market, many of DeFi’s perks can now be used.

A white paper from SMARDEX explained a procedure to lower impermanent loss (IL) and a technique known as “fictive reserve (FR).” To find out if you’ve temporarily lost money, compare the profit or loss you would have made by keeping your tokens with the profit or loss and selling costs associated with giving them to the liquidity pool.

How Does SmarDex Work?

SmarDex addresses the issue of impermanent loss by managing liquidity with fictive reserves. Smardex works on a unique principle, employing an “adjusted K constant rule” on a “fictive reserve.”

This specific algorithm seeks to achieve a balance among the tokens in a liquidity pool. It lessens price volatility and, thus, the dangers associated with temporary losses.

The system automatically adjusts the pool balance, resulting in more stable swap prices. This invention makes Smardex a viable option for individuals participating in DeFi, particularly when managing tokenized crypto portfolios.

SmarDex maintains liquidity differently, employing the classic DEX model but modifying the so-called k constant rule to maintain equilibrium over time while not just decreasing temporary loss but potentially producing impermanent benefits.

SmarDex’s liquidity pools, like those in the DeFi space, allow users to deposit tokens and provide liquidity. Like other DeFi protocols, it enables users to make passive income through staking and farming.

When customers buy tokens from a pool at one price and sell them at another, the pools become imbalanced, and the liquidity provider typically loses money. In this scenario, the fictive reserve uses two distinct liquidity reserves.

SmarDex’s pools automatically determine which token is gaining in price and sell less of it upfront. Liquidity providers can mitigate losses and potentially make short-term returns by selling the growing token at a higher price later. But that’s not all: SmarDex pays fees and rewards to liquidity providers while simultaneously providing users with features they can’t get anywhere else.

Conclusion

SmarDex’s engineers have cleverly addressed the common issue of temporary loss in the DeFi domain. Its novel procedure promises to convert a temporary loss into a temporary gain.

SmarDex intends to change how liquidity providers engage with automated market makers by providing a unique algorithm to combat temporary losses and reduce charging rates.

By continuously improving its features and services, SmarDex has the potential to become the top choice for traders seeking a better and more decentralized trading alternative.