ShibaSwap Demystified: How it Works and How to Get Started?

ShibaSwap Demystified: How it Works and How to Get Started?

The Doge Killer Shiba coin was nothing but a memecoin to knock the efforts of its counterpart Dogecoin, by market capitalization. It was launched in August 2020 by the pseudonym 'Ryoshi." It was a huge success right from the start.

An Ethereum-based dog-themed meme coin that features the Japanese breed of hunting dog as its main mascot is Shiba Inu. It is a memecoin. In easier terms, it is a cryptocurrency associated with a meme- in this case- the Shiba Inu dog. Usually, it doesn't even have much utility but is just an inside joke shared between investors in the crypto market.

Due to its nature, Shiba Inu quickly gained momentum and value, witnessing a wave of new investors. This especially happened after the Twitter popularity of Elon Musk and Vitalik Butterin. In October 2021, a year after its launch, Shiba Inu's price shot up to $41 billion, a ratio more than tenfold.

Though in the recent past, the news related to the cold crypto market due to various factors has affected the memecoins, including Shiba Inu, there is still some hope left for its long-term benefits.

Following the development post its high demand, ShibaSwap was launched in July 2021; ShibaSwap is a popular DEX i.e. decentralized crypto exchange that evolved off the Shiba Inu ecosystem.

The system allows users to trade cryptocurrency without needing a third party or intermediary. This means that all the transactions done using the mechanism of ShibaSwap are done on a peer-to-peer basis. This makes it more private, discreet and secure than a third-party mechanism. This helps to carry out any digital asset transactions easier as well.

Many of the features offered by other contemporary cryptocurrency exchanges, such as PancakeSwap and UniSwap, are also available on ShibaSwap, including governance, liquidity pools, non-custodial digital currency swaps, a market for non-fungible tokens (NFTs), staking, and yield farming.

In simple terms, it enables users to exchange tokens without using a counterparty, middleman, or centralized authority. Instead, it automates tasks using smart contracts and can run independently as long as users provide liquidity.

The Role of Tokens in the Shibaswap Ecosystem: SHIB, BONE, and LEASH

It was built atop the Ethereum network. The main tokens or coins used by ShibaSwap are the ones from the Shiba ecosystem. These include Shiba Inu coins like SHIB, BONE, LEASH, etc.

These three primary tokens are the main coins that help function the entire ecosystem of ShibaSwap.

One quadrillion SHIB were distributed during the initial currency offering, with half going to Vitalik Buterin, co-founder of Ethereum. Later, Buterin sent 450 trillion SHIB to a dead wallet and gave 50 trillion SHIB to an Indian COVID-19 relief fund. Post-this, the remaining 500 trillion SHIB were locked in Uniswap.

As suggested by its name, Doge Killer (LEASH) was a part of SHIB's campaign to undermine Dogecoin. DOGE has lost its position as the most valuable memecoin. The token's first 1:1000 peg to the price of DOGE was unsuccessful. The coin has long ditched its purpose and depends on scarcity to show its value. LEASH has a fixed quantity of 107,647 tokens and operates as an ERC-20 token.

A governance token in the ShibaSwap ecosystem is called Bone (BONE). To put it another way, BONE holders can utilize the Shiba Inu Doggy DAO to vote and propose improvements to the ShibaSwap protocol. The total supply of BONE is 250 million coins. The platform's governance token is called BONE. The numerous proposals on the ShibaSwap platform are up for voting by holders. One's vote has a greater impact on the outcome of the choice the more tokens one possesses.

ShibaSwap is a hard fork of SushiSwap, which is also a hard fork of Uniswap. It offers many of the same features as these two platforms and those of other decentralized exchanges.

If you visit the website of ShibaSwap, you will find the following functions, which are common in other decentralized platforms as well. Users can perform the six main functions: DIG, NFTs, BURY, SWAP, Doggy DAO and WOOF. However, the name is fancy and related to its Shibu dog theme. These are nothing but doggy-themes names for standard services. For example- DIG is nothing but liquidity pools, and BURY is staking. While WOOF is a funny term for yield farming, and Doggy DAO is the main governance page. Two of the functions without any themed names are NFTs and SWAP. They are self-explanatory.

Users can stake SHIB, BONE, or LEASH through the staking mechanism to produce high-interest yields paid in BONE tokens. Users of DIG can add cryptocurrency pairs to already-existing liquidity pools or start brand-new ones. Either way, they will receive ShibaSwap liquidity pool tokens as payment (SSLP). Through the WOOF (yield farming) feature of ShibaSwap, these SSLP tokens can be exchanged for BONE.

Users can buy, sell, and trade Shibo, a 10,000-strong NFT collection of pixelated Shiba Inu cartoons, on ShibaSwap's NFT platform. Every cartoon has unique qualities and rarities. Finally, SWAP enables users to trade a variety of coins.

Users can track their returns and view the most recent interest rates on the DIG and BURY functionalities using ShibaSwap's BONEFOLIO tool. Users can willingly dispose of their SHIB, BONE, or LEASH on the platform through a burn gateway.

Besides the above functions increasing the value, nature and rarity of the Shiboshis, their holders can also customize them. There is also an analytical page called Bone Folio. This page comprises all the historical data on return on investment (ROI), staking data, and transaction fees. Users can also use it to keep track of their yield rewards using Bone Folio.

ShibaSwap is a decentralized exchange, which means it is not governed by the same laws as centralized exchanges, making it potentially safer than conventional trading platforms since no single company is holding your funds. The assessment of the exchange's code further suggests that it might be a secure trading platform.

The Future of ShibaSwap: Opportunities and Challenges

According to a security score performed by CertiK, a blockchain-based security assessment business, ShibaSwap has a security score of 92/100. The DEX platform has also addressed 34 problems that were brought up during its assessment. ShibaSwap can claim the top spot among decentralized exchanges because this equates to 97% of the issues raised.

ShibaSwap has been a huge success so far, with many customers or users on board. It has a daily trading volume of nearly $3 million and almost $20 million locked on the platform. These are great numbers for a system or platform launched recently. The platform also saw more traction when it migrated to the Shibarium. It is now in the news due to the rumoured launch of layer one blockchain in Shiba Inu.

Though the platform is safe, the decisions must be made carefully considering all the factors. Even while investing in any of the tokens mentioned above, there is a need to understand the dynamics and ecosystem of the ShibaSwap in detail. Before buying or trading in cryptocurrency, it is imperative always to conduct your own research. That will make the process safer, easier and more convenient for the user.

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