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Infusion Protocol enhances DEX stability on Base with timelock feature

Mar. 21, 2024

Infusion's timefused liquidity aims to mitigate risks associated with memecoin volatility.

Golden infusion timefused liquidity mechanism icon on teal gradient

Infusion, a novel automated market maker (AMM) protocol, has officially launched on Base, the Layer 2 solution incubated by Coinbase, introducing a unique liquidity timelock feature known as timefusing to decentralized exchanges (DEXs). This feature is designed to provide stability and predictability for traders and on-chain applications by ensuring liquidity remains locked for set periods.

The timefusing mechanism is particularly relevant in the context of meme coins, which have seen instances of liquidity being pulled abruptly, causing significant investor losses. Infusion’s approach aims to prevent such scenarios, as seen with the BALD meme coin rug pull on Base, which resulted in over $20 million in losses.

Infusion’s team, with experience from DeFi leaders like 1inch, Pendle, Harmony, LI.FI, and Thorchain, is positioning the protocol as the go-to DEX on Base. By implementing timefused liquidity, Infusion not only promotes higher quality liquidity on-chain but also introduces a new on-chain primitive for other applications to leverage.

The protocol’s advanced fee-sharing model rewards liquidity providers who commit to longer timefused periods, fostering long-term stability on Base. This model of “provable liquidity” is expected to benefit the broader on-chain economy, including lending protocols and credit scoring systems.

Within its first day, Infusion has already recorded over $1 million in volume and established partnerships with leading Base native DeFi projects like Seamless Protocol. Infusion’s alignment with Base’s goals—mass adoption, fast and affordable transactions, and a robust DeFi ecosystem—positions it as a significant player in the on-chain economy.

The launch of Infusion comes at a time when Base is experiencing significant growth in daily transactions, likely driven by the recent Dencun upgrade that dramatically reduced transaction fees on the network. The number of daily transactions on Base, based on a seven-day moving average, reached a new peak of over 1.05 million on March 17, just days after the upgrade. This surge in activity, coupled with Infusion’s innovative liquidity management features, further solidifies Base’s position as a leading Layer 2 solution for the Ethereum ecosystem.

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