Liquifi V2 - efficient DEX protocol

The Liquifi team is building a DEX protocol with fair exchange rates for traders and high APY for investors to attract more Cardano users.

Liquifi V1 is a unique DEX protocol in BSC and Ethereum that solves the price slippage and front-running issues with "time-locked swaps".

Implementation of the Liquifi V2 protocol can reduce price slippage up to hundreds times as we do not need to scatter liquidity across thousands of tokens pairs. If average losses from slippage could be as large as $1M monthly, we can reduce them to $10K - this gives $990K of profit for traders every month.

The impermanent loss can reduce liquidity providers income by 10-20% of the invested assets. For a $100M pool it gives more than $10M losses. We can, first, decrease them in 10 times, giving $9M additional revenues; second, give liquidity providers additional revenues from slippage. This will result in significantly higher APY on the same volumes of trades.

Project roadmap:

10/09/2021 - Liquifi V2 on Cardano architecture and technical design

20/09/2021 - Prototype in the Alonzo Purple testnet released

20/10/2021 - Liquifi V2 protocol in the Cardano mainnet released (public launch)

01/11/2021 - Security audit of Liquifi V2 Plutus code

15/12/2021 - Launch LQF token bridging between BSC and Cardano

Impact on the challenge metrics

Implementation and launch of the efficient DEX protocol on Cardano will increase the number of viable applications on top of Cardano and attract users to the platform. Viability of the application will be supported by the fact that no AMM-based DEX is available on Cardano by now and Liquifi V2 will be among the first launched applications of this type. The efficiency of the protocol will allow highly competitive exchange rates that will bring transaction volumes to the project.

Liquidity providers will benefit from low impermanent loss and high APY on investments. New users will also be attracted to the platform by the farming and yield pools features. In general, the whole Cardano ecosystem will acquire more digital asset holders and increase platform capitalization.

Definition of success

3 months: Liquifi V2 protocol launched in the Cardano mainnet, security audits passed.

Users: 1000

Monthly volumes: $100,000

TVL: $100,000

6 months: LQF token bridging between Binance Smart Chain and Cardano established.

Users: 10000

Monthly volumes: $1,000,000

TVL: $500,000

12 months: application scaling and performance improved.

Users: 100000

Monthly volumes: $100,000,000

TVL: $10,000,000

Budget

Development costs: $45,000

Marketing: $25,000

Initial liquidity supply: $30,000

Total: $100,000