SheepDex, the 1st DEX offering concentrated liquidity that integrates spot trading and derivatives in the Binance Smart Chain (BSC) ecosystem, was officially launched at 13:00 UTC on October 10, 2021. Audited by CertiK, Peckshield and more audit firms, SheepDex is powered by advanced automated market-making (AMM) mechanism, offering a more secure and outstanding user experience with three incentives for liquidity providers (LPs) and traders.
Based on BSC, SheepDex not only allows fast transactions with lower gas fees but also introduces several innovative features that are not yet available on other DEXs in the BSC ecosystem，such as concentrated liquidity, multiple fee tiers, range orders system and triple incentives. Each liquidity provider (LP) can now provide liquidity to the price ranges where most transactions occur, rather than adding liquidity to a price range from 0 to infinity.
The most important innovation brought by the range order system of SheepDex lies in liquidity provision. With range order system, LPs can add liquidity within certain price ranges, thereby greatly improving their capital efficiency while allowing them to get more market-making options. SheepDex will be a super flexible protocol and it will be able to support a wide range of different assets. It also brings granular control to the original reserve curve X*Y=K, which allows LPs to maximize their income since they can add liquidity into the price ranges where most trades occur. Simply put, SheepDex will help LPs to allocate funds within a certain price range, thereby improving the fund efficiency, reducing trading slippage and centralizing trading depth.
The refund of transaction fees can make LPs more profitable, thus attracting more LPs and increasing the total value locked (TVL).
Concentrated liquidity of the Range Order system provides better market depth even in the case of small TVL, and the transaction rewards will also help to provide arbitrage opportunities and further boost trading volume.
In turn, the increase of trading volume will increase LPs' income from earning trading fees, combined with the yield farming incentives for LPs, will further increase TVL, forming a virtuous cycle of income-TVL-trading volume-increased income.
With these functionality, SheepDex can effectively achieve a higher capital efficiency with better liquidity and less slippages, distinguishing itself from other DEXs in an increasingly competitive landscape. LPs can also adopt more complex strategies or tactics to actively manage their liquidity in order to earn higher returns, while traders will have a smoother trading experience with less slippages.
The first batch of supported liquidity pools including: BNB/BUSD, BNB/BTC, BNB/ETH, BUSD/BTC, BUSD/ETH, ETH/BTC, BUSD/USDC, BUSD/USDT, and BNB/SPC.
To benefit both LPs and traders, SheepDex provides three incentives including LP rewards, yield farming and transaction rewards. This incentive mechanism is also first seen in the BSC ecosystem.
For LPs, they can earn passive income -- yield farming -- by providing liquidity, and if the transaction occurs within the range where liquidity is provided, LPs also get transaction fee refunds as LP rewards. For traders, they can earn SPC rewards by completing a trade or swap.
SheepDex also has well designed tokenomics to encourage long-term token utility and community engagement.
The native token of SheepDex is SPC, with a total supply of 90 million. Its emission will be reduced by 20% every 90 days and 25% of the transaction fees will be used to repurchase and burn SPC. Other repurchasing and burning mechanisms will also be launched soon. These make SPC a true deflationary token and help SPC holders capture SheepDex’s economic benefits.
On top of that, token holders also have other practical benefits, such as participating in future IMO and lottery features, as well as voting in the governance process on key opinions for SheepDex such as protocol parameters, rewards emission schedule, token listing and yield farming options.
Spot trading is only the first step of SheepDex’s exploration in the DeFi field. SheepDex aims to provide users with the most CEX-like trading experience in DeFi, so more derivatives will be launched in the next, making SheepDex the most powerful DEX.
The forthcoming derivatives will pioneer a zero funding rate for perpetual contracts through the vAMM mechanism, with a special price rebase mechanism to ensure that the price will not deviate too much from the spot price, and to provide arbitrage opportunities. All these will make it more cost-effective for traders to hold their contacts, help market makers to avoid impermanent loss while maintaining 100% liquidity.
To learn more about SheepDex and have a deep dive into its features, you may visit the website or join the SheepDex community: