Decentralized exchange SushiSwap will deploy its smart contracts on the Avalanche blockchain to expand the ecosystem of decentralized finance (DeFi).
Given the high demand for decentralized finance (DeFi) products, the Ethereum network cannot cope with the loads. This has led to an increase in transaction fees. However, Ethereum provides a powerful “foundation” for the development of DeFi. Therefore, the developers of Ava Labs believe that integration with one of the largest decentralized exchanges will help expand their DeFi offerings and allow them to compete with Ethereum.
In the fall, Ava Labs launched the main Avalanche blockchain network to surpass the not-yet-operational Ethereum 2.0, thanks to higher throughput and faster consensus building between nodes. In addition, last month, a “bridge” was created between the Avalanche and Ethereum blockchains, with which DeFi users can move crypto assets between the two networks.
Unlike centralized exchanges, decentralized exchanges do not store user assets. Instead, they use smart contracts to optimize peer-to-peer trading. To start trading on a DEX such as SushiSwap, users will need ETH – the” common currency ” of the DeFi protocols on the Ethereum blockchain. AVAX coins will be used to make transactions and pay commissions, which will increase the network’s liquidity and the value of AVAX.
John Wu, President of Ava Labs, said that Avalanche represents an additional ecosystem for DeFi users who are literally pushed out of the market due to high gas fees. This situation will encourage users to take a closer look at Avalanche-based applications and take advantage of the evolving DeFi industry.
The president of Ava Labs explained that the integration of SushiSwap with Avalanche is not intended to “entice” users from Ethereum. On the contrary, Ethereum and Avalanche should join forces to transform DeFi from a niche product into an equal competitor to traditional financial services. The deployment of SushiSwap smart contracts on the Avalanche blockchain will be another step closer to this goal.
Recently, the developers of SushiSwap reported that the platform’s smart contracts were launched on five new blockchains at once: Moonbeam Network, Binance Smart Chain,Polygon, Fantom, and on the sidechain of the Ethereum xDai. In the future, it is planned to use the Optimism and Solana blockchains.