Atlas will help traders weave a path through the pantheon of DEXs that now exist multi-chain. As DeFi protocols are built out on Solana, BSC, and other major chains — as well as the mainstay Ethereum, traders will need to operate cross-chain to get the best trades with their assets. Atlas’s guiding light algorithm will collate prices from multiple liquidity sources and find the best route for users to move from Asset A to Asset Z, and give a one-click solution to complex sets of multi-chain trades.
Cross-Chain Trading — Pioneering the Next Great Challenge
As the blockchain ecosystem develops, and more networks emerge offering competing yet synergistic visions of our modern world, there becomes a need for data on one chain to be accessible and deployable on another.
This, like nation states opening their borders to trade with one another to propel the globalization that is the norm of our modern world, is what leads to collective growth. Yet doing so is a serious technical challenge, one that has only begun to be solved in the last 12 months. Centralized exchanges work, but you don’t own your crypto and not all pairs are available.
This is why DEXs like Uniswap emerged in the first place, and why DeFi became such a tantalizing opportunity that exploded over 2020. However, Uniswap, and other similar DEXs, are restricted as they can only offer tokens on one network — commonly the market leader, Ethereum. Yet more and more assets are being launched, stored and transacted on other blockchains, and liquidity is thus being fragmented across a variety of DEXs in the wider blockchain landscape. Atlas wants to connect this landscape up.
Cross-Chain Liquidity — The Key to the DeFi World
Liquidity, or the lack of it, is what causes markets to seize up, trading pairs to go haywire, and asset volatility to become unworkable and the price too unstable. The DeFi market, if it restricts itself to one blockchain, inherently stunts it’s own potential. The DeFi market is blooming across multiple chains, with BSC, Solana, Avax and more nurturing their own prosperous spaces.
That means the biggest opportunities are sometimes not on the chain where a trader holds most of their assets. Cross-chain liquidity is a must so that the aggregated assets of the blockchain space are being utilized at any one time and sudden seizures in availability on one blockchain don’t upend the market unnaturally — especially when there is plenty of liquidity available on another.
Nobody likes slippage
Moreover, sometimes if the appropriate pairs don’t exist, significant slippage occurs as an AMM processes the transaction through multiple pools to achieve the desired trade, incurring slippage along the way. This can be frustrating when there are huge swathes of liquidity siloed out of reach on another chain.
Traders also want fluidity cross-chain, and are still hunting for a good solution to it. Effective cross-chain liquidity and multi-DEX trading in a seamless manner is the new target in the DeFi space. It opens up the possibility to loan with cross-chain assets, and for people who hold tokens on multiple chains to access cross-chain farming.
Right now, blockchains are islands — with hundreds of trade routes between them that, yes, kind of work — but which haven’t reached their full potential. What is needed is a map so that traders can navigate these digital seas and have the best routes between blockchains, and the best trades available within them, charted for them. That is what Atlas, by taking advantage of Solana’s wormhole tech, provides.
Mapping the Blockchain Universe
Rather than using just one blockchain’s ecosystem, Atlas plans to oversee all of them and give a simple UI map so that traders can see where the market is heading before anyone else. Moreover, by taking advantage of the aggregated liquidity provided, traders can then make the trades that benefit them the most and not incur to slippage as the liquidity they need just happens to be located on a different island.
How? By using the guiding light algorithm. Atlas’s tech splits a transaction, say of token A to Z, across multiple platforms. It harvests data from all available AMMs, and automatically calculates the most efficient route to get to token Z. Perhaps, on DEX 1, token B and Z have excellent liquidity, so it apportions some there. On DEX 2, Token C and Z have excellent liquidity, and so goes that route, and so on and so forth.
The culmination of this complex series of trades — automatically done for you — is to get you from token A to token Z, which may exist on another island entirely, for the best possible price. All this happens simultaneously. A complete one-click solution. It ensures slippage is minimized, liquidity traps are avoided, and price-data is most effectively utilized so that the trader takes the best possible route from one token to another.
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Continued… coming soon