The DeFi scenario
Ever since the initiation of Decentralized Finance, the market has been at an all-time high. The latest statistics show that there has been an exponential growth of DeFi assets by around 10 fold compared to the previous years. There are a wide array of protocols, decentralized exchanges, and dApps in the DeFi sector, offering a myriad of services to those interested in investing, trading, and borrowing. In this ever-evolving and innovative landscape, a new protocol or rather decentralized exchange platform has risen, offering never before seen functionalities in the DeFi space – MoonDeFi.
What is MoonDeFi?
MoonDefi is a trustless and highly decentralized financial structure predominantly notable for two functions – Swapping and Staking, for which users receive benefits. Built on the Ethereum platform, users mostly swap ERC-20 tokens. With this protocol, buyers and sellers need not worry about creating demand in the protocol. The protocol has been designed intuitively to allow automatic balancing of value depending on the demand present via an equation. Liquidity is created in the protocol and automatically without depending on the traders. A feature that sets MoodDeFi apart from standard exchanges is the very low fee structure – a rarity in the DeFi spectrum.
The inner workings of the MoonDeFi protocol
MoonDeFi is an automatic liquidity marketplace, meaning unlike other centralized and decentralized exchanges, there is no necessity to create liquidity separately. Order books and centralized authorities have been made obsolete with this protocol, allowing users to smoothly swap between ERC-20 tokens. Traders utilizing this platform can exchange Ethereum tokens on it, including the native ETH ones, and they also have an option to provide liquidity to the protocol and collect fees for that service, the only requirement being an Ethereum address. MoonDeFi holds the title as the only protocol in the DeFi space that creates its own liquidity (automated liquidity).
Swapping tokens on MoonDeFi
As mentioned earlier, the MoonDeFi platform is known for the user’s ability to swap tokens without the need for buyers and sellers to create any demand. This swapping is done efficiently by employing a model called the “Constant Product Market Maker Model.” This is a mechanism that allows the protocol users to begin swapping. The process goes like this –
- A user wants to swap a token, say Token Z.
- They will create a Moon smart contract with Token Z.
- A liquidity pool is simultaneously created with $10 worth of Token Z and 10 ETH.
- Users can only add to the MoonDeFi protocol by providing an equivalent value of ETH to the token being swapped or traded.
- Once this is done, the user is now a liquidity provider.
- Now that a liquidity pool for that particular token has been created, any user wishing to trade tokens or provide liquidity for that particular pool may do so.
- Those contributing to the pool can earn a fee of 0.3% for their provision.
Staking and farming on MoonDeFi
The MoonDeFi protocol also allows for liquidity mining on its platform. Following up on the previous steps, the liquidity providers who earned benefits are also provided with LP tokens. These tokens can be utilized for participation in a high-profit staking program. The rewards earned as a result, will be dispersed among the other liquidity providers who have deposited assets.
Another notable feature this platform offers is farming. Token holders can make use of the automatic searches the MoonDeFi protocol initiates to find the best interest rates for their tokens. By optimizing productivity and adopting the latest algorithms, the protocol hunts down profitable rates for those users wishing to farm their crypto tokens.
The two pivotal benefits of staking on the MoonDeFi protocol includes
- When users stake tokens or coins, they are rewarded with an interest rate of 30% to 40% annually.
- Liquidity providers can stake their earned liquidity tokens or LPs and gain an extra interest, going all the way up to 45%
The native token of the MoonDeFi protocol is called MOON. It comes with one of the highest interest rates witnessed in the DeFi ecosystem. It has a booming APY of 150%, unparalleled among most native tokens. The MOON token is only issued in small numbers-210 million tokens, to be exact. This token is currently available through four liquidity mining pools for a limited period of four years. A perpetual inflation rate of 4% has been announced after four years, which is meant as an incentive for continual participation in the Moon DeFi protocol. So the MOON token holders are in for a remunerative experience on the protocol. The MOON holders have ownership over the following –
- Governance
- Community treasury
- Protocol fee switch
Governance on MoonDeFi
All MOON token holders have governance rights over the functioning of the protocol. The protocol boasts readiness over providing community-led growth, self-sustainability, and development. The governance framework of MoonDeFi aims to focus on protocol usage and development and widening the user base of the protocol ecosystem. The members part of the governance community are in control of the government treasury that holds 49% of MOON supply, which is distributed through community grants, community initiatives, liquidity mining, and other programs. The protocol also vests the governance treasury on a continuous basis following a schedule. The governance can also vote on the allocation of MOON towards mining pools, grants, governance initiatives, partnerships, and other programs.
Benefits of the MoonDeFi protocol that sets it above other decentralized exchanges
- Produces the highest APY
- Large governance community
- Lower transaction costs
- Automated liquidity provision
- A heap of benefits for MOON token holders
Build and Launch protocol like MoonDefi with Blockchain App Factory
A protocol that enables trading without an order book is an extraordinary feat, and the MoonDeFi protocol does just that. If you’re looking to enter the DeFi space and aim to launch a business, a protocol like MoonDeFi is the right fit for you and we’ve got the best services. At Blockchain App Factory, a leading developer of DeFi protocols and dApps, your MoonDeFi like protocol will become the go-to protocol for all swapping and trading needs.
Our white-label and customizable solutions will give you the lead to design and launch a MoonDeFi like protocol giving your business the highest visibility and user engagement. Our team of dexterous developers and Blockchain engineers will ensure your protocol takes the spotlight in this lucrative DeFi space.
