After Successful Launch, Solana DEX Raydium May Integrate SushiSwap
Raydium is one of the newest additions to the Solana ecosystem, but it’s quickly gained traction. The decentralized exchange may soon integrate key Ethereum protocol SushiSwap.
- Raydium, a new decentralized exchange running on Solana, may soon integrate SushiSwap.
- A proposal on the SushiSwap forum details a plan to use Raydium as a bridge to bring the exchange onto Solana.
- Raydium supports order books and has quickly drawn attention from the DeFi space.
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SushiSwap on Solana? Thanks to Raydium, it may happen soon.
Proposed SushiSwap Integration
Raydium, a new automated market maker (AMM) built on the Solana blockchain, may integrate SushiSwap.
A proposal called “Bonsai” on the SushiSwap forum details a plan to “build out SushiSwap on Solana and Serum.” Written by someone using the moniker handroll, the proposal starts by acknowledging SushiSwap’s growth, which Ethereum helped.
The post explains how Raydium was built on Serum and Solana to solve three issues: expensive gas fees, lack of limit orders and advanced trading, and fragmented liquidity.
Handroll, who appears to be involved in the Raydium project, also says:
“If we could somehow work alongside the community to build out support for Sushiswap on Solana, we think the community would quickly see even wider reach while Sushi products would benefit from ecosystem-wide liquidity, fast transactions and low fees on Serum.”
The proposal notes that Serum’s decentralized order book could potentially support SushiSwap’s liquidity pools. It then explains how Raydium could effectively be a bridge to bring SushiSwap onto Solana.
The process would involve supporting SushiSwap’s liquidity pools and staking on Serum, followed by Raydium’s testnet. Later, developers would deploy SushiSwap’s Bonsai pools on mainnet, and Raydium would integrate SushiSwap’s Raydium pools.
Raydium Launches on Solana
Raydium recently launched on Solana and has quickly garnered attention from the DeFi community. The project’s early success has been helped by Solana and Serum figurehead Sam Bankman-Fried, who alerted his Twitter followers to the launch earlier this month. Explaining the advantages of Raydium, Bankman-Fried told Crypto Briefing:
“Raydium is unique in two ways: 1) Solana makes it fast, cheap, and high throughput 2) Because it provides liquidity on Serum orderbooks, it is able to provide to all the flow on Solana, not just users who seek it out; and it has the flexibility to provide in different ways in the future.”
Bankman-Fried also helped SushiSwap early on, standing in to take ownership of the SushiSwap contract’s keys after Chef Nomi rug pulled the community. He told Crypto Briefing that a SushiSwap integration would be beneficial for both protocols. He said:
“Integrating SushiSwap would help bring users and Sushi airdrops over to [Raydium], and would help bring fast and cheap transactions, liquidity, and fees back to SushiSwap.”
Raydium includes an order book for trading while also promising low gas fees. In some ways, the Solana network has branded itself on its low running costs, which is a possible attraction for regular DeFi users as Ethereum gas fees hit new highs (a fast trade hit 1,000 gwei yesterday).
In a tweetstorm, Bankman-Fried explained how Raydium could aggregate liquidity across protocols and provide access to traders. It achieves composability by using Serum as “an on-chain matching engine,” fast transactions on Solana, and the support of order books to allow market makers and takers to share order flow and liquidity.
1) What is @RaydiumProtocol?
— SBF (@SBF_FTX) February 22, 2021
Raydium’s pools went live on Feb. 19 and already have millions of dollars in total value locked. The RAY token, meanwhile, has soared since launching on Sunday. In a week where the rest of the market is experiencing a downturn, it’s already hit a market cap of $121.8 million, trading at $11.20.
Disclosure: At the time of writing, the author of this feature owned ETH, and a number of other cryptocurrencies.