What is Raydium? Before we get to that let’s start with the ecosystem and the problem. Recently, the DeFi space has grown from just a simple buzz word into an ENTIRE ecosystem. The ecosystem is now setting a new standard for finance and the crypto space. As an embodiment of decentralization and cryptocurrency, DeFi has been allowing more and more people to have access to financial services. However, the current DeFi ecosystem is far from being perfect.
So what exactly are the problems?
There’s quite a few downfalls to DeFi, but the ecosystem still holds enormous opportunity. These problems include expensive transaction prices as seen with high gas fees. Moreover, the DeFi space also contains a lot of market fragmentation. The nature of AMMs on the Ethereum platform means that the liquidity is relatively fragmented. In addition to market fragmentation, the various features on the platform are also limited. Due to the slow transaction speed and high gas fees of Ethereum, it often makes it difficult to implement efficient trading features. This makes it difficult for users to benefit from any of the platforms.
How do we solve all these problems?
This is where Raydium comes to play. Raydium is different from other AMM platforms. The platform will provide on-chain liquidity to a central limit order book. Built on the Solana blockchain, the platform will be able to also leverage the central order book of the Serum DEX enabling lightning-fast trades, shared liquidity and various features for earning yield. Even though Raydium is built on Solana, the platform will also be interoperable with Ethereum. Raydium is a high performance, permissionless blockchain that is based on Proof of History.
As of right now, the platform can handle 65,000 transactions per second with 400 millisecond block times. The protocol is designed to scale together hardware and bandwidth improvements wi .Raydium also utilizes a constant function K = Y*X. This equation has special properties that are stateless for any two tokens allowing infinite liquidity for traders. Raydium will utilize this equation and price orders on the order book according to the Fibonacci sequence to then provide up to 20 orders at various prices with spreads as small as 20bps. This serves as an optimized solution to fit exchange instructions all onto a single Solana transaction. Additionally, in the future Raydium expects other liquidity providing models to be employed and it will take advantage of the oracles and the increased liquidity usage.
What advantages does Raydium have?
Raydium has various advantages that makes it a much better protocol than other available protocols out there. These advantages include:
1. Faster and Cheaper
By leveraging the Solana blockchain, the platform is able to efficiently achieve transactions faster than Ethereum and gas fees that are a fraction of the cost.
2. Central Order Book for Ecosystem-Wide Liquidity
Raydium will provide on-chain liquidity to the central limit order book of the Serum DEX. So this means that Raydium will allow access to the order flow and liquidity to the entire Serum ecosystem!
3. Trading Interfaces
The trading interface is for traders who want to view TradingView charts, set limit orders, and also have more control over their trading.
What exact features are onboard?
Raydium has various features that will help maximize the user’s experience. All these features work together to address the issue as mentioned earlier:
Orderbooks will show the available bid and offer prices between the market participants. So they’ll give market participants the ability to express the number of tokens they wish to trade at any price. With Serum, Raydium will bring orderbooks back to AMMs.
As the bread and butter of Raydium. Raydium will take all the tokens accrued in its liquidity pool to then place orders on the orderbook according to the constant product invariant.
Coin swaps allow users that do not require the orderbook to enjoy cheap gas fees and low trading fees when swapping their tokens.
By Farming on Raydium, the liquidity providers can generate additional rewards for their contribution. The key pools will also be incentivized with RAY tokens.
Dual Reward Farming
The Raydium community will have the ability to govern the pools that receive farming rewards. Tokens that wish to reward users for providing liquidity can also add additional reward tokens.
What can you do on Raydium?
Trade and Swap
Raydium’s swap feature will allow two tokens to be exchanged quickly through Serum. At the same time, DEX UI will also allow for more advanced trading features including limit orders. This will help make a better overall trading experience for users.
There’s various ways that you can earn RAY tokens on the platform. So the ways that you can earn RAY tokens will include farming liquidity pools and staking! Additionally there will be more features on the way for users to earn RAY!
Power your Project with Raydium
If you wish to launch your project on the Serum DEX or even supercharge features on your platform on Solana, Raydium can achieve that for you!
Let's talk about the $RAY token!
The $RAY token is the native token on Raydium. There will only be 555 million RAY tokens. The total RAY mining reserve will consist of 34% (188.7m RAY) of all tokens. The emissions will approximately last for 36 months and halvenings will occur every six month. *Note that 0.03% of the trading feels will be rewarded to RAY stakers. In addition, other uses for the token will include:
- Staking RAY tokens to generate additional yield and earn trading fees
- Staking of RAY for additional Multipliers on yield
- Limited governance model allowing stakers of RAY to vote and participate in community proposals and amendments
Any costs that I should know about?
Whenever you make a trade or perform a swap on Raydium, there will be a transaction fee of 0.25%. Then 0.22% is redeposited into the liquidity pool and will act as a reward for liquidity providers. After that, the remaining 0.03% will be sent to the staking pool and act as a reward for users staking RAY tokens.
Raydium’s Future Roadmap:
- Ideation and project scope
- Development of the protocol and iteration on testnet
- Development of liquidity pools and staking completed, mainnet launched
- Website and platform launch
- Development of cross-chain swap
- Research on additional market making models and features in partnership with other protocols
- Leverage of external oracles for improved market making
- Governance model ideation in collaboration with partners
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