Today, Ethereum-based DEXes have been taking the crypto world by storm and have assumed the front-and-center stage for optimized trading. DeFi users rely on Ethereum-based DEXes to execute quick and easy trades, the most popular being Uniswap.
DEXes have amassed enormous amounts of liquidity, eating up a substantial portion of the market share from centralized competitors. Their use case is well established, as users of all kinds continue to flock to them to benefit from token offerings, anonymity, and convenience.
All of these benefits don’t come without a cost, and these issues have left a plethora of challenges and unmet needs. Amidst all of the hype, there is a new player in town looking to change things up in the DeFi world, and that project is Polkaswitch.
Polkaswitch is a decentralized cross-chain asset exchange and liquidity protocol that leverages the cumulative liquidity from DEXes on Polkadot, Ethereum, and other layer 1 solutions. Using various algorithms, it takes a holistic view across the DEXes and finds those with the highest liquidity and best price for the token you are trading.
It is one of the first cross-chain trading solutions to be introduced to the market. It is undergoing beta testing in Q1 2021, followed by a highly anticipated testnet and eventual product launch in Q2/Q3 2021. Prominent features will include a clean and sleek user interface/trading view, a trustless system, and compatibility with top wallets such as MetaMask.
Although Ethereum-based DEXes are continuing to grow and become increasingly popular, many issues have arisen, causing frustrations across the crypto community. This has led to users flocking to alternative layer 2 solutions or different chains entirely (i.e. Binance Smart Chain).
The biggest issue is the extremely high gas fees on Ethereum. Some users have reported paying anywhere from tens to hundreds of dollars to simply approve or make a swap on Uniswap. Because of this, Ethereum’s scalability has slowed down tremendously (for the time being) and users are often highly disincentivized from trading.
Trading options are also limited, as you are currently limited to only swapping one token from another without any advanced features. While convenient and easy-to-use, many users wish that DEXes offered more trading features, such as limit orders or advanced price charts.
Lastly, there are simply too many DEXes to choose from; this is more of an inconvenience for users than a problem, with users often unsure of which one to use to get the fairest prices for their trades and ensure the quickest and most seamless executions.
Polkaswitch has quite a challenge ahead, as it aims to bring a new product to market with the hopes of alleviating most of the issues Ethereum users face. Fortunately, it has high hopes and strong institutional and community backing. In March 2021, it received $3 million in seed funding from several top VC firms to help fuel its growth. Furthermore, several recent partnerships with the likes of Moonbeam and Manta Network are expected to skyrocket its potential.
With Polkaswitch, worries about swapping between DEXes are eliminated, as all of the prices and liquidity will be displayed from a birds eye view. Additionally, it will expand access to Polkadot DEXes, opening up more options for cheap and fast trading while still giving users the option to select from Ethereum and other layer 1 solutions.
The user interface is expected to have a beautiful design, with simple price charts and trading options laid out on one screen. Compatibility with MetaMask will be supported, so the majority of users can keep their funds in-house.
Now that we’ve dived deeper into Polkaswitch’s potential and the need it will fill, it’s difficult to imagine a world without it; the underlying concept and technology are indeed promising, and the community is getting more anxious each day for the anticipated product launch.
The project is currently in development but is rushing ahead, so make sure to keep yourself informed on everything that’s happening by going to its website and following it on social media: