SUSHIUSD
SushiSwap / United States dollar
crypto Gemini

SushiSwap is a decentralized exchange built on Ethereum that utilizes an automated market making system rather than a traditional order-book. Instead of matching individual buy and sell orders, users can pool together two assets that are then traded against, with the price determined based on the ratio between the two. SushiSwap began as a fork of Uniswap; however, is growing into a more diversified, more grassroots alternative. SushiSwap is a protocol that facilitates the exchange of tokens on Ethereum. Typically, exchanges function by using an order-book where market makers set the price at which they are willing to buy and sell an asset. The difference between these prices is how they get paid for this work. SushiSwap does away entirely with the order book and instead opts to have market makers deposit assets into a pool that traders can then trade against. The price is determined algorithmically based on the proportion of the two assets being traded. Price mechanism SushiSwap uses what's known as a Constant Product Market Maker that is designed to always provide liquidity regardless of the order size or amount of funds in the pool. This is achieved by asymptotically increasing the price as the size of the buy order increases, leading to potentially significant slippage on large orders. Trading pools consist of two tokens, with the product between the two sums remaining constant. Any given transaction increases one sum while decreasing the other and the price changes based on the ratio between the two. Providing liquidity When liquidity providers add to a pool, they receive newly minted liquidity tokens entitling them to their proportion of the total pool as well as the 0.25% fee generated off each trade. SUSHI stakers receive the remaining 0.05% from the 0.30% charged on ever trade. Liquidity tokens are not speculative and simply keep track of how much of the pool is owed. Liquidity providers need to supply both assets in the same proportion they are currently at, otherwise, they will change the ratio and thus price. This would result in the immediate loss of money as the price change should get arbitraged out by trading bots. Even if providers supply the correct ratio of each asset, large price changes can result in the loss of money. (Details on how this work can be found here). Therefore, providers are hoping for substantial volume of trading around the price they entered such that the fees generated account for any potential losses. The Road Ahead: SushiSwap's community has big plans for 2021. Currently, SushiSwap is just an exchange, but it plans to evolve into a more diversified institution. Here are some of the products SushiSwap's community is targeting in 2021: Deriswap: In collaboration with Yearn, SushiSwap plans on launching Deriswap, a single liquidity pool for swaps, options, lending, and futures BentoBox: Planned for Q1 2021, BentoBox is a protocol that aims to create Uniswap-like (permissionless) lending markets. With BentoBox anyone will be able to create a pair, which others can borrow or lend against. Compared to Aave or Compound, this will isolate risk to specific pairs rather than the entire system. It also allows traders to build margin trading strategies around SushiSwap Miso (Minimal Initial Sushi Offering): Short for Minimal Initial Sushi Offering, MISO will be a token launchpad, designed to drive new projects towards launching on SushiSwap. It will include crowdsale options and functionality aimed at easing new tokens through their launch and migrating new liquidity into SushiSwap Mirin: Mirin will bring a number of upgrades including customizable (fees, rewards, etc) franchised liquidity pools whereby traditional exchanges can offer their users the option of becoming liquidity providers through SushiSwap in what are called SubPools. Additionally Mirin will bring new LP curve options (not being locked to x * y = k), which may allow it to compete with the likes of protocols like Curve which differentiated on the basis of their LP curves. Finally Mirin will likely also feature a new impermanent loss protection & single-sided LP Solution being developed by Andre Cronje. Multi-chain Communication: SushiSwap will be launching on Moonbeam in 2021. Polkadot/Moonbeam will likely have a live testing version of Sushiswap in Q2'21E on Kusama. Additionally, SushiSwap plans to integrate with THORChain, which will enable cross-chain swaps. The idea behind it is that THORChain would support the short-tail of cryptoassets for cross-chain exchange, while SushiSwap would support long-tail assets on Ethereum Read more about SushiSwap's growth and where its headed in The Grassroots Decentralized Exchange