To understand why you should perform stableswap on Kayak Finance, you first need to know the principles behind stableswap.
What is Stableswap❓️
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Kayak StableSwap is an implementation of an Automated Market Maker (AMM) that adds a linear invariant constant sum curve (x+y=k) on top of the constant product formula (x*y=k) as long as the liquidity pool is not extremely unbalanced, to keep prices more equal.
As a result, since StableSwaps are restricted to similarly priced assets, impermanent loss is not as much of a concern (except in extreme depeg cases), and the slippage is lower than in normal AMMs that only use the constant product formula.
Why Stableswap is needed❓️
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Low slippage: StableSwap can reduce slippage loss when exchanging stablecoins.
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Low fees: Lower fees compared to regular exchanges
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Reduced risk: Liquidity providers face lower impermanent loss risk
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High efficiency: Supports direct exchanges between different stablecoins
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Better liquidity: Provides a stable source of liquidity for the DeFi ecosystem
In short, Stableswap optimizes trading for stable assets, improving the efficiency and safety of stablecoin usage in DeFi.
But why do you need to use Kayak Finance for StableSwap❓️
As crypto has evolved, we now have many more chains than before - Avalanche, Mantle, Morph, and many others.
On these numerous chains, there are many different stablecoin trading pools. On chains where trading activity is not active, the liquidity of assets is greatly reduced, limiting the utilization of assets.
Here are several reasons for using Stableswap on Kayak Finance:🫵
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Kayak Finance aggregates liquidity into one pool for trading, reduces asset losses caused by low liquidity, and improves asset utilization.
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Kayak Finance supports cross-chain transactions.
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Kayak Finance will issue stablecoins to increase asset stability.
Within a week of our launch, we have supported Avalanche Mainnet and Morph testnet, and we will support more chains in the future.
