Token Swap Protocol ZKSwap Reaches $1 Billion in Total Value Locked

The first phase of the event lasted for 14 days with some 8 million ZKS tokens allocated to PoL mining and 1 million ZKS for PoT. Starting with trading pairs, PoL miners had 6 available: ZKS/ETH, USDC/USDT, ZKS/USDT, ETH/WBTC, ETH/USDT, and HBTC/WBTC; PoT mining pairs are currently limited to USDT/USDC.

March 23, 2021

National

5 min

zeenews

Just a month after launching, decentralized exchange (DEX) protocol ZKSwap has gathered $1 billion in total value locked, becoming one of the fastest-growing projects to enter the space in recent months.

Token Swap Protocol ZKSwap Reaches $1 Billion in Total Value Locked

Considering that the total value locked in decentralized finance (DeFi) overall sits at around $43 billion, the rapid success of ZKSwap is a fascinating one at that, as well as being a sizable contribution to the ever-evolving, hyper-competitive digital asset space.

What is ZKSwap?

Built and developed by L2Lab, the DeFi project was recently backed by a $1.7 million investment from a few venture capital firms, offering a solution to Ethereum’s high gas fees and low throughput.

At present, the DeFi ecosystem is in somewhat of a bottleneck crisis, as more and more projects are developed and launched on the Ethereum network, as does the volume of transactions and interactions, causing gas fees to skyrocket.

In February 2021, Singapore-based L2Lab launched its Layer 2 solution on ZK-Rollups, scaling the transaction capacity on Ethereum with zero-proof technology. The result is a token swapping protocol capable of processing 100 times the capacity of leading DEX, Uniswap – as well as costing 1% of the gas fees seen on Ethereum Layer 1.

According to Vitalik Buterin in mid-2020, these “rollups will be the dominant scaling paradigm for at least a couple of years”, which implies that until ETH2.0 is complete, these solutions will be dominant forces in the DeFi ecosystem.

Early Bitcoin contributor and Chief Scientist for the Bitcoin Foundation, Gavin Andresen said of ZKSwap on Twitter, “Swaps and sends were wicked fast and cheap. Layer2 back to ETH main chain is $5 and takes maybe 30 minutes.”

Alex Lee, Head of Development for ZKSwap, noted:

“We are very proud to present the mainnet release of ZKSwap, which is now fully functional and very hands-on. We believe AMM-based layer-2 DEXes represent a whole new stage in the development of DEXes, and the highly performant DEX of ZKSwap powered by the cutting-edge ZK-Rollup technology is well-positioned to be a leader. The solution offered by ZKSwap will be a strong boost to a complete lay-2 DeFi ecosystem.”

The demand for such solutions is extremely high, which is evident in the fact that it took just over a month for ZKSwap to achieve what Uniswap did in two years.

Mining with ZKSwap

In early March, ZKSwap introduced liquidity mining and transaction mining initiatives, namely the Proof-of-Liquidity (PoL) and Proof-of-TransFee (PoT), mining events to the community.

Reportedly, the total prize-pool on offer is more than $20 million, and the rapidly growing community supporting ZKSwap is set to reap crypto-incentives for supporting the ZKSwap network.

The first phase of the event lasted for 14 days with some 8 million ZKS tokens allocated to PoL mining and 1 million ZKS for PoT. Starting with trading pairs, PoL miners had 6 available: ZKS/ETH, USDC/USDT, ZKS/USDT, ETH/WBTC, ETH/USDT, and HBTC/WBTC; PoT mining pairs are currently limited to USDT/USDC.

The TVL grew steadily after a smooth launch on 6 March and grew to $1.03 billion as of 21:40 GMT on 17 March.  This record has surpassed 1INCH, making ZKSwap one of the top-tier Defi products.

What’s to Come?

With this latest launch, ZKSwap has also unveiled its roadmap for the rest of 2021 and into Q1 of 2022, and it’s looking rather promising.

Highlights include news of the ZKSwap team preparing to support the ERC-721 token standard, as well as providing infrastructure for non-fungible token (NFT) transactions and swaps. NFT’s are gaining a great deal of traction at present, making this a rather timely move.

Furthermore, they’ll be expanding into stablecoin lending and swap services, as well as a consistent focus on scalability, governance, and enhancing the DeFi space.

Despite its nascent stage, ZKSwap has become a sure-fire hit in the DeFi space considering the total value locked. If this level of growth persists, ZKSwap may become one of the key faces of DeFi for years to come.

Related Topics

Related News

More Loader