- Launched in May 2022, Sudoswap is the first automated NFT market maker aiming to address the lack of liquidity in the NFT market.
- Instead of having to trade directly with each other, users can deposit NFTs and ETH into liquidity pools, allowing other NFTs to buy or sell through those pools.
If you have ever tried trading NFTs, you surely know how illiquid these assets can be. If you are looking to buy an NFT, the one you want may not be for sale. If you are looking to sell an NFT, there may not be a buyer in sight. Luckily there is a solution for this.
Sudoswap allows NFT degenerates to have Uniswap-like experiences when trading NFTs. As a decentralized NFT exchange, the platform runs on an automated market maker (AMM) model to address the lack of liquidity in the NFT market.
Let’s take a look at Sudoswap and how you can easily trade NFTs on this innovative platform.
What is Sudoswap?
Launched in May 2022, Sudoswap is a decentralized NFT marketplace that allows users to trade NFTs using an automated market-maker model. Specifically, the platform allows users to trade NFTs and ETH via user-funded liquidity pools.
Many NFT marketplaces, like OpenSea, typically run on an off-chain order book model. This is often unsuitable for illiquid markets such as the NFT market in this case.
This is where Sudoswap shines, however, as users can buy and sell NFTs through on-chain liquidity pools.
As long as there is a pool for this NFT collection, users can immediately sell their NFTs into the pool and receive ETH in return. Those who deposit NFTs or ETH into the pool also earn fees on trades that take place in the pool.
However, keep in mind that you may not always get the price you want as the price of NFTs changes according to the number of NFTs remaining.
The more NFTs that are sold, the more expensive the NFTs in that pool are and vice versa. This is an effect of the peg curve that Sudoswap implements for its liquidity pools.
A list of Sudoswap’s pools and binding curves
There are three types of liquidity pools on Sudoswap: buy-only pools, sell-only pools and buy-and-sell pools. Each of these pools can include one of the following retention curves:
- Linear Curve: The NFT price rises or falls linearly as buying and selling take place.
- Exponential curve: The NFT price increases or decreases by a certain percentage as buying and selling take place.
As shown in the CloneX NFT pool below, you can tell by the double arrow (circled in yellow) that it is a buy-and-sell pool. At the moment the pool is ready to sell one CloneX at 6.7 ETH and buy one at 6.00651 ETH.
Each time this pool buys or sells an NFT, the price will decrease or increase by 4%. If you deposit NFTs or ETH into this pool, you earn 3% of the transaction amount when someone trades with this pool.
Pool creators can set their swap fees down to 0.5%. And buyers don’t have to pay any project fees at Sudoswap.
An example of a CloneX buy-and-sell NFT pool. Source: Sudoswap.
How to buy or sell an NFT on Sudoswap?
First, go to Sudoswap and click “Connect” on the top right to connect your Web3 wallet. When you’re done, click Collections in the top left to view all collections.
NFT Collections on Sudoswap.
Select from the list above the NFT collection you wish to trade and you will be taken to the relevant page for that collection. For example, this is what the Azuki NFT page looks like on Sudoswap:
Single page for Azuki NFT. Source: Sudoswap.
As of this writing, there are a few ways you can trade NFTs on Sudoswap:
- Buy from direct listings: On the Buy page, look for NFTs at list prices. Then click View Article on the NFT you like. You will be taken to a separate page showing all the details of this NFT. To buy this token, click “Buy Now” and confirm the transaction in your MetaMask wallet.
- Make a pick-up offer: Alternatively, you can offer to buy one or more NFTs by creating a pool with a starting price and a discount percentage.
- List NFTs for sale: You can also offer your NFTs for sale with or without price increases. Simply navigate to “Your NFTs” in the top right corner and select the NFTs you wish to list.
- Create liquidity pools on Sudoswaps: If you are one of the advanced users, you can trade NFTs and earn trading fees through liquidity pools. To do this, click on “Your Pools” and then on “+ Create a new pool” to select one of the three options below. Sudoswap guides you through the process, asking you to specify how much ETH and how many NFTs you want to deposit and choose a peg curve to set up the liquidity pool. Once done, voila! You are now one of the NFT liquidity providers on Sudoswap.
Three types of liquidity pools are available on Sudoswap.
Learn Crypto Trading, Yield Farms, Income strategies and more at CrytoAnswers
https://nov.link/cryptoanswers
Comments are closed.