SushiSwap is a decentralized exchange (DEX) running on the Ethereum blockchain that was built to solve the “liquidity problem.” Unlike centralized exchanges, it does not need to possess user tokens in order for them to be able to trade them. This means users can trade peer-to-peer with liquidity that is supplied by other users. These users are offered incentives such as revenue sharing.
Investors of SushiSwap liquidity pool get “SushiSwap Liquidity Provider” (SLP) tokens as rewards so they can reclaim funds and crypto fees they earned. Its customized automated market maker (AMM) uses smart contracts and integrates other decentralized markets and DeFi features to facilitate trading. Through SushiSwap, users swap crypto once they connect their wallets to the SushiSwap exchange.
Every type of market is available on Sushi. It has its own exchange (SushiSwap), it’s own lending market (Kashi), and staking derivatives (xSUSHI). xSUSHI appreciates in value from platform exchange fees served on the SushiBar. DeFi users can use its staking and farming features without restrictions. It is the most effective system in DeFi for farming yield. It has a high yearly interest rate. Our SushiSwap metacoin rating finds that this is its main advantage. The farming approach also allows non-liquidity providers the opportunity to earn rewards.
Sushi token holders can propose changes and make decisions on governance protocol and platform development. They vote on structural changes while a core team handles day-to-day operations and business strategy. Other benefits of Sushiswap are affordable fees (0.3% for joining any liquidity pool) and users can earn passive income.