The latest project we’ve been looking into may become one of the leading Solana Automated market makers and a major player in decentralized finance. Cyclos is the first AMM to bring concentrated liquidity to Solana and it’s launching soon.
Before the rise of the Automated Market Maker (AMM) model DEX users who wished to trade their crypto assets were left at the mercy of low liquidity order books, high costs, and subpar user experience (Who remembers Etherdelta?)
The AMM model offers improved liquidity compared to orderbook-based DEXs, but CFMM based AMMs have some inefficiencies due to their assets being distributed along the price curve: – Most of the liquidity in the price curve is unused. – Trades on low volume have high slippage.
@cyclosfi allows users to concentrate liquidity, constructing individual price curves of their choice. Trades then occur against the combined liquidity of all individual curves. Cyclos offers traders the world’s most efficient limit order system.
The concept of concentrated liquidity was introduced in Uniswap V3 but its true potential can’t be unlocked due to the current network barriers such as variable swap fees and high gas costs.
Existing AMMs on Solana use the constant price curve, the lack of LP price intervals means less order book depth & low rewards Cyclos has made concentrated liquidity on Solana possible so users can spread their LP over greater price intervals to earn more fees at low costs
The team has received high levels of support for their project, this has led them to move quickly. Development is going well and it’s already looking likely that they will accomplish their vision of a user-friendly AMM that harnesses the true power of concentrated liquidity
Cyclos chose to build on Solana because it’s high throughput and low-cost network creates the perfect environment to maximize the power of concentrated liquidity.
Their aim is to insert Cyclos into the ecosystem as a catalyst for taking trading volume on Solana to the next level
Conclusion
The AMM Market on Solana is currently still wide open so we’re excited to see how Cyclos fairs within the Solana AMM Arena.
If concentrated liquidity is the key to higher yields and more consistent gains within DeFi then it should capture a large volume of capital, liquidity, and users.
The public launch of Cyclos is expected for later November.
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Which Solana project would you like to see us cover next? Let us know and we’re on it! Until next time Insiders! 🦍🤝
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