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Stellar-Based DeFi Lumenswap (LSP) Activates Smart Order Routing System. Why Is This Important?

Sun, 08/21/2022 - 05:26
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Vladislav Sopov
Lumenswap (LSP), one of first DeFi protocols in Stellar (XLM) ecosystem, introduces its brand-new swaps optimization tool
Stellar-Based DeFi Lumenswap (LSP) Activates Smart Order Routing System. Why Is This Important?
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Lumenswap, a pioneering decentralized cryptocurrency exchange on the largest XRPL fork Stellar (XLM), shares the details of its newest mechanism designed to dramatically increase the profitability of trading.

Lumenswap (LSP) advances its capital efficiency with Smart Order Routing

According to the official statement shared by Lumenswap (LSP) on its social media channels and its main blog, it has implemented a novel value logistics protocol dubbed Smart Order Routing, or SOR.

By default, every protocol in the Stellar (XLM) ecosystem leverages Horizon API in order to find the best pricing and yield farming options for its clients. However, Horizon API’s rates are not necessarily the best ones.

To address this major bottleneck, Stellar (XLM) introduces Smart Order Routing (SOR). For end users, SOR activation results in better pricing for AMM-powered cryptocurrency exchange.

SOR thoroughly analyzes liquidity statistics across all of Lumenswap’s (LSP) pools to find the most profitable and “deep” liquidity instrument.

Cutting-edge DeFi ecosystem with native token LSP: What is Lumenswap?

Once the most profitable pools are found, the Smart Order Routing mechanism splits an order between various pools. For instance, in demonstration mode, a sell order for 200,000 LSP (intended to exchange them for USD Coins, or USDC) was successfully split between LSP/XLM/USDC, LSP/USDC, LSP/AQUA/USDC and LSP/LBTC/USDC pools.

Lumenswap splits orders between various liquidity pools
Image by Lumenswap

The difference between new and old routing mechanisms and the list of pools available are displayed in the Swap Details section.

Lumenswap (LSP) users can swap their assets through SOR by clicking a rainbow-colored button, while the blue button is used to swap assets in “classic” mode.

As covered by U.Today previously, Lumenswap (LSP) is the first-ever AMM-powered DEX in the Stellar (XLM) ecosystem. It merges the benefits of classic interfaces with a fully decentralized order matching engine.

Stellar-Based Exchange Lumenswap (LSP) Introduces Crypto Trading Ecosystem and Token

Lumenswap (LSP) issued its core native asset, LSP, to reward users for their activity as well as to enable participation in community-driven referendums within the Lumenswap DAO platform.

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About the author

Blockchain Analyst & Writer with scientific background. 6+ years in IT-analytics, 3+ years in blockchain.

Worked in independent analysis as well as in start-ups (, Monoreto, Attic Lab etc.)