Stellar-based DeFi Lumenswap (LSP) enabled Smart Order Routing System. Why is that important?

Vladislav Sopov

Lumenswap (LSP), one of the first DeFi protocols in the Stellar (XLM) ecosystem, introduces its brand new swap optimization tool

contents

• Lumenswap (LSP) improves its capital efficiency with Smart Order Routing
• Cutting-Edge DeFi Ecosystem With Native Token LSP: What is Lumenswap?

Lumenswap, a pioneering decentralized cryptocurrency exchange on the largest XRPL fork Stellar (XLM), shares the details of its latest mechanism designed to dramatically increase trading profitability.

Lumenswap (LSP) improves its capital efficiency with Smart Order Routing

According to Lumenswap (LSP) official statement on its social media channels and main blog, it has implemented a novel value logistics protocol called Smart Order Routing or SOR.

#Lumenswap now supports Smart Order Routing mechanism for AMM swaps. 🧠

From now on you can get a better price for your trade by splitting your orders into different pools; the same steps but at a better rate. 🌈

Read more 👇https://t.co/2LVjRA5LjP

— Lumenswap (@lumenswap) August 19, 2022

By default, every protocol in the Stellar (XLM) ecosystem leverages the Horizon API to find the best pricing and yield options for its customers. However, Horizon API’s plans aren’t necessarily the best.

To address this major bottleneck, Stellar (XLM) introduces Smart Order Routing (SOR). For end users, SOR activation results in better prices for AMM-backed cryptocurrency exchanges.

To sue

SOR thoroughly analyzes the liquidity statistics of all Lumenswap (LSP) pools to find the most profitable and “deepest” liquidity instrument.

Cutting-Edge DeFi Ecosystem With Native Token LSP: What is Lumenswap?

Once the most profitable pools are found, the Smart Order Routing mechanism splits an order between different pools. For example, in demonstration mode, a sell order for 200,000 LSP (with the intention of exchanging them for USD coins or USDC) was successfully split between LSP/XLM/USDC, LSP/USDC, LSP/AQUA/USDC and LSP/LBTC/USDC Pool.

Image by Lumenswap

The difference between new and old routing mechanisms and the list of available pools are shown in the Swap Details section.

Lumenswap (LSP) users can swap their assets via SOR by clicking a rainbow colored button, while the blue button is used to swap assets in “classic” mode.

As previously reported by U.Today, Lumenswap (LSP) is the first-ever AMM-powered DEX in the Stellar (XLM) ecosystem. It combines the advantages of classic interfaces with a fully decentralized order matching engine.

Lumenswap (LSP) has released its core native asset, LSP, to reward users for their activity and allow participation in community-driven referendums within Lumenswap’s DAO platform.

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