DeFi has developed rapidly in the past two years, but limited by L1 performance, gas fees, etc., user experience has become an obstacle to the further development of DeFi. And Arweave-based storage consensus paradigm SCP brings a new solution to DeFi with unlimited performance, nearly 0 gas fee, 0 slippage, and no MEV.
On May 16, 2022, Permaswap, the first cross-chain DEX on Arweave based on the Arweave and everPay protocols, officially announced the launch of its official website and white paper.
The primary goal of Permaswap is to provide decentralized trading services for the Arweave ecosystem, activate the liquidity of Arweave’s native assets, and fill the gaps within the Arweave ecosystem.
Permaswap is a completely decentralized P2P network, in which the LPs in the network are peer-to-peer self-custody accounts, and the assets are managed by the user’s private key. Any individual or institution can deploy a program that conforms to the network protocol to provide liquidity in the network. Nodes in the network perform price calculations and build peer-to-peer orders in a decentralized manner according to protocol rules, which makes the network censorship-resistant and scalable; this can provide transaction services for tens of millions of users.
Users can transact on Permaswap with extremely low gas fees without encountering MEV issues. At the same time, Permaswap can flexibly support a variety of AMM algorithms to provide LPs with more market-making options. At the same time, the real-time and fast trading mechanism allows LPs to more flexibly adjust market-making strategies and ensure market-making returns.
Censorship-resistant peer-to-peer network: A fully decentralized P2P network where anyone can deploy routers and LP nodes. Censorship resistant, it cannot be interrupted or turned off.
Unlimited Scalability: Each router can connect hundreds of LP nodes, providing exchange services for thousands of users. Many routers can be deployed on the network to provide price distribution and order generation.
Flexible configuration: The network protocol supports various types of AMM market making curves. LP nodes can choose the market making curve according to their own needs.
No MEV: Users sign orders using a deterministic bundle of identifiable income and expenses, bots cannot conduct MEV attacks, nor can they leverage user assets for arbitrage.
Asset self-custody: The private key and assets are in the hands of the LP, and the assets are highly secure. No need to worry about the risk of complex smart contract code implementation. LP nodes follow only the simplest mathematical notation for references and signatures. Simple and easy security auditing.
Permaswap Network consists of two types of nodes, Router and LP. Routers are responsible for price aggregation and order generation, while LPs provide asset liquidity to the network.
By staking PSN tokens, any individual and institution can become a router node.
The router node is the network hub of the Permaswap network and is the generator of transaction orders. The Router node collects all LP quotations (token information, liquidity, quotation range and other parameters) connected to the node. When the user sends a transaction request to the Router, the Router generates a quotation based on the collected LP information and returns it as a bundled transaction to everPay. User sent. After confirming the offer, the user signs the bundled transaction using his wallet. At the same time, the bundled transaction is notified by the Router to the corresponding LP for signature. When all parties involved in the transaction have signed, the order is sent from the router to everPay for real-time execution.
On everPay, bundled transactions are an opAction. It allows many-to-many transfers and requires signatures from all transfer parties. If any subtransaction within a bundled transaction fails, the entire bundled transaction is rolled back.
Router node functions: generate many-to-many aggregated orders with optimal price, release of signed transactions, submit orders to everPay for fulfillment.
In Permaswap, LP information can be shared among multiple routers, and the mobility of a single LP is circulated throughout the network.
By staking PSN tokens, individuals and institutions can become LP nodes.
The LP node is an automatic quote program that injects keys and uses a specific AMM model. The operator of the LP node needs to set the quotation curve and interval for the LP, and inject matching funds into the LP. All this information needs to be registered with the router.
When an LP registers with a Router, the LP must sign the order issued by the Router according to the protocol rules of the registration information. Failure to properly sign will result in the forfeiture of a portion of the pledged tokens. When the amount of PSN pledged falls below a certain threshold, LPs will be eliminated from the Permaswap network.
LPs can stop market making at any time, but must submit a cancellation request to the Router. Cancellation removes the need to quote based on agreed information and allows for cancellation of PSN staking.
AMMs in Permaswap
The Permaswap network will be an automated trading network with multiple AMM models.
The Router node of Permaswap can freely choose a specific AMM model, and the LP node chooses to join the corresponding Router node according to its own risk preference and capital amount, and uses the AMM model of the Router node to make the market. In the future, the router node can also choose the transaction aggregation algorithm, and the AMM model will be freely selected by the connected LP. Ultimately, the Router will be able to aggregate LP offers connected to this node and other Router nodes in the network, providing users with the best price.
Permaswap is different from traditional on-chain AMMs.
Comparison of traditional on-chain AMM and Permaswap
Limit order function
In addition to automated market making (AMM), Permaswap’s network can also provide limit orders.
Arbitrage robot: The user pre-signs a bundled order with the arbitrage robot as the counterparty at the target price; when the quotation in the AMM router reaches the target price, the arbitrage robot can fill in the user’s pre-signed order and conduct reverse transactions in the AMM router at the same time.
LP one-way market making: In the current Constant Product AMM Model Router, LP nodes can implement limit orders by setting the price fluctuation range, so that the price can only move in a certain direction.
MEV exists because of the uncertainty of block packaging and the delay of transaction ordering.
The everPay bundled transaction used by Permaswap is a deterministic atomic transaction. It is completely certain that a user signs a bundled transaction, spends 1 A token and receives 10 B tokens, it is impossible to spend 1 A token and receive only 9 B tokens. Any transaction that does not meet the exchange rules will result in a full rollback of the entire bundle. At the same time, everPay provides a real-time execution environment for bundled transactions, allowing orders to be executed and confirmed in real time without setting slippage, ensuring order execution efficiency and truly realizing WYSIWYG token exchange.
Permaswap will issue PSN tokens to guarantee network stability and decentralized governance.
Name: PermaswapNetwork (PSN)
Standard: Native, ERC20, PSC
Maximum Supply: 1,000,000,000
50% for incentivized liquidity; 20% for ecosystem; 15% for investors/advisors; 15% for R&D.
The Permaswap white paper represents a development process with four stages: Precursor, Forerunner (Mainnet Launch), Prophet, and Flood.
The first phase, expected to open within two months, will allow NFT holders from previous everPay NFT auctions to participate in the initial Permaswap liquidity mining.
Posted by:CoinYuppie，Reprinted with attribution to:https://coinyuppie.com/a-quick-look-at-permaswap-the-first-cross-chain-dex-on-arweave/
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