Many blockchains use technologies unique to the ecosystem they were built for. This can make it difficult for assets to be moved from one blockchain to the other and correspondingly, data across chains are not easily transferrable.
Over the years, different projects have risen to tackle this persistent issue facing the interoperability of these different blockchain networks. Swim Protocol aims to solve that by using Solana to allow swaps between chains.
In this beginners guide, we are going to teach you how to use Swim to swap your stablecoins. We will demonstrate how to use the protocol to swap and access the multiple liquidity pools offered by Swim. By the end of this guide, you will be ready to use Swim to trade stablecoins across blockchains!
Not to make the introduction too bulky, lets mention Wormhole. Developed by Jump, a reputable cryptocurrency trading arm of the Jump Trading organization, Wormhole is a protocol built to facilitate ease of data transference, communication and asset portability between different blockchain networks.
These infrastructural services that helps relay information across multiple blockchain networks are called bridges. Although this system works, users only get to receive a wrapped version of the asset they are trying to transfer across networks. But wrapped assets
By utilizing Wormhole, Swim protocol has built a cross-chain service that helps users make multichain transactions in an easy way. For instance, if I want to convert my USDT to from BNB Chain to USDT to Solana, I will be receiving wrapped USDT on Solana.
This is not fungible with the native USDT SPL token that is available on Solana. Now I have to deposit it at FTX for example so I can withdraw a Solana SPL-compatible USDT. It is a tedious process for people and most especially for those who would not like to interact with centralized systems.
With Swim Protocol, data communication and asset transference can now occur speedily and without the need for users getting wrapped assets or getting delayed because they rely on centralized systems.
Native assets can now “Swim” across one ocean of a blockchain to others.
Swim Protocol is currently compatible with 5 blockchains
- Solana (on which it was built primarily)
- BNB Chain
By creating a multi-wallet compatible application, it is now easy for you to view balances and make transactions across chains without needing to leave the Swim Protocol page.
A liquidity pool is a combination of tokens deposited by users that enables a decentralized exchange like Swim protocol to be able to facilitate trading activities. You can also participate in this pooling system by providing some liquidity of a stable coin that you have on a particular chain. You will be rewarded with some of the revenues generated from these activities.
From the image above, you can see the total liquidity supplied for trading the stable coins on Swim Protocol.
Swapping is the act of exchange tokens for another token on a blockchain. With Swim Protocol, you can now swap your stable coins used on one blockchain’s ecosystem to another one without stress.
Below is a short tutorial on how to swap your tokens
This is a practical demonstration on how to swap tokens from Solana to BNB Chain. Navigate to the Swap section of the application and select the stable coins you need to work with.
Select the wallets you want to transact on by clicking on them.
You can see the number of your wallets that has been connected below
You can proceed to select from the options in any of the stable coins and the platform you want to swap into. I chose USDT purposely so that it won’t look as if it was because I swapped USDC to USDC that made it work well. So USDC on Solana to USDT on BNB Chain.
A section below the tokens to be swapped will show you the estimated gas fees that will be required to complete the transaction. (I ignored ETH for a reason ????).
Because I currently have no gas fees in my BNB wallet, a warning was issued to me. Always make sure there is enough fees to cover transactions in the blockchain you are interacting with else the transaction won’t go through.
After fixing my gas fees issues, I clicked on the Swap.
Different transactions will pop up awaiting for your approval and the rest, as they normally say, is history.
Security: is Swim safe to use?
Blockchain applications have suffered many hacks and security issues. They still experience this issue). However, it is required that protocols built to last should have a well audited code base so as to prevent future security issues.
The code for Swim Protocol was audited by Kudelski Security, a reputable blockchain auditing firm in December 2021.
Apart from being properly audited by Kudelski, Swim Protocol offers hackers up to a $100,000 in rewards for disclosing vulnerabilities that can affect the protocol negatively.
The native token for the protocol is $SWIM. With a maximum supply of 1,000,000,000 $SWIM tokens, the following shows how they are properly allocated.
- Partnership and Ecosystem Incentives, 35%: This is the amount of $SWIM tokens allocated for various forms of partnerships with projects in the ecosystem, marketing provisioning etc.
- Liquidity Mining, 10%: This is the reward allocation earned by those who deserve the mining incentive when they supply liquidity for the tokens in the protocol.
- Liquidity Provisioning, 10%: Whenever a token is launched, there is a need to put some of their tokens in Decentralized and Centralized exchanges to give users an easy access to the tokens. This allocation makes it easy for those interested in trading $SWIM.
- Team, 20%: This is the token allocation for the development team of Swim Protocol. This serves as the base that can be used for Salary, protocol’s cost etc.
- Seed, 5%: This is the amount of $SWIM token assigned to investors of the protocol at the early stages of the project.
- Please note that as at the time of this writing, $SWIM token from Swim Protocol has not been released for trading.
The Swim Team is made up of many seasoned professionals in the roles they handle. With Troy Tsui as the CEO, a former quantitative trader at Alameda Research, Arv Akr as the CTO (a former software engineer at FTX) and Ruari Donnelly as the COO who also happens to be a former chief of staff at FTX.