SUSHI’s soaring market is dazzling, is there any risk in SushiSwap?

According to the announcement, the “Global Observation Area” of Huobi Global has opened SUSHI deposit and currency trading (SUSHI/USDT, SUSHI/BTC, SUSHI/ETH) services on September 1. After going online, the highest hit 11.5004SUSDT, the biggest increase is more than 100%. Today SUSHI has launched multiple trading platforms, which is a more eye-catching star project.

 According to Huobi Research Institute, SushiSwap allows users to mine the governance token SUSHI through the mainstream LP tokens on stakingUniswapV2. Each block is issued 100 SUSHI, and these tokens will be evenly deployed in all 13 pools. In the first two weeks, each block will get 1000 SUSHI, and the SUSHI/ETH pool will get 200 SUSHI. SUSHI tokens have no practical value and only have governance rights. Once Uniswap’s liquidity is migrated to SushiSwap in the future, SUSHI token holders will share 0.05% of the transaction fee.

 In Sushiswap, 0.25% of the fee will be directly allocated to the liquidity provider, and the remaining 0.05% will be converted into SUSHI tokens. In addition, in order to ensure the continuity of R&D and operations, 10% of SUSHI tokens will be used for development and future iterations, audits, etc. From the perspective of this token model, Sushiswap’s token SUSHI can capture 0.05% of transaction fees, that is, the value of SUSHI is linked to its transaction volume. On Sushiswap, the greater the transaction volume, the higher the fees SUSHI captures.

 Ma Tianyuan, a senior researcher at Huobi Research Institute, said that Sushiswap is not yet online at this stage. It provides incentives to the liquidity providers of major trading pairs on Uniswap. The incentive method is to provide high APY Farm rewards by locking the LP Token of the leading trading pair. In the short term, Sushi has greatly improved Uniswap’s liquidity. Since the launch of sunshine, the overall liquidity collateral on Uniswap has soared by 400%, especially mainstream assets such as ETH. As of 15:30 on the 1st, the transaction slippage of 200ETH was only 0.1%, even in the face of second-line CEX.

 However, the current Sushi pass model may have some flaws that must be paid attention to. Its model support may be weak. At present, it mainly relies on the voting needs of projects that need to open a new pool. However, the purpose of opening a new pool is only to allow specific transaction pairs to obtain additional sushi rewards, which is difficult to form a closed loop. If the current only LP fee reward of 0.05% injects value and cannot make it form a closed loop, it may damage its incentive effect in the long run. But all in all, at this stage, Sushiwap is very similar to Uniswap’s incentive layer.

 Huobi Research Institute believes that because Uniswap does not launch a token incentive system, the DEX market has left opportunities for competition to intervene. Sushiswap is the most typical representative. This model is similar to FCoin’s FT transaction mining. , But because it is actually built on smart contracts, it is still very different from FT. Huobi Research Institute reminds that any liquidity mining has potential risks of smart contract vulnerabilities. Participating in liquidity mining also needs to consider risk tolerance and control risks.

Market analysis

BTC is close to the integer mark, need to pay attention to the breakthrough



According to data from the Huobi trading platform, after last night’s turbulent downward adjustment, Bitcoin was supported near 11500, following ETH out of a rapid rise during the day, reaching a peak of 11966.84 USDT, but it still did not break through the 12000 integer mentality If the barrier can be effectively broken through or cause a certain stimulus to the market, it may attract new funds to enter the market, bring a certain improvement to the relatively quiet market activity, and it may be out of a new round of rising market. Pay attention to whether BTC can effectively break upward at night.

According to the Huobi trading platform, after ETH sideways in the morning, ETH continued to increase in volume from midday, from 435 USDT all the way up rapidly. It has broken through the previous high of 450 USDT and reached 475.00 USDT. It is currently consolidating around 470. As the Defi hotspot Sushi is connected to the three major exchanges today, the rising price of ETH is due to the huge increase in the demand for liquidity mining of ETH, which can be seen from the outflow of ETH from centralized exchanges. These demands directly push up the market demand for ETH. At night, you need to pay attention to the selling pressure of short-term profit orders, which may cause certain market fluctuations.

According to data from the Huobi trading platform, Sushi, which landed on Huobi, continued to rise sharply during the day, and the intraday increase reached 88%. As of 18:30 in the evening, it has reached 10.82USDT. Because of the function of Sushi itself to vote for the currency, the short-term behavior that caused multiple currency communities to snap up Sushi has not ended, and some community project parties even bought tickets directly with fiat currency. Moreover, mainstream transactions such as Huobi’s rapid listing of coins further increased market liquidity, thereby pushing up market prices.

In terms of contracts, the big data of Huobi Contract shows that BTC contract holdings are relatively stable, contract trading volume has increased slightly, and the contract market is not very active. The basis of delivery contracts rose slightly, and the funding rate of perpetual contracts rose slightly.

The ETH contract open interest increased, and the contract volume increased slightly. The basis of the delivery contract expanded slightly, and the perpetual contract funding rate was close to zero.

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