OolongSwap is the first native decentralized exchange (DEX) on the Boba Network, built with the goal of providing an efficient and low-cost platform for trading, liquidity provision, and DeFi participation. As an Automated Market Maker (AMM), it allows users to trade ERC-20 tokens directly on the Boba Network with minimized slippage and optimized gas fees. OolongSwap’s approach, combined with its innovative features such as dynamic pair fees and Protocol Controlled Value (PCV), distinguishes it from traditional DEXs.

OolongSwap was launched with the mission to expand the Boba ecosystem by becoming the primary liquidity hub of the network. The platform aims to facilitate easier access to decentralized finance (DeFi) services while lowering entry barriers for users through lower costs and intuitive design.

Main Features of OolongSwap

Unlike traditional AMMs that apply a flat transaction fee across all trades, OolongSwap uses a dynamic pair fee structure that adjusts the transaction fee based on the liquidity and risk profile of the trading pair. For instance, high-risk or less liquid pairs may have slightly higher fees, while well-established pairs enjoy lower fees.

This system allows OolongSwap to optimize fees and offer fairer trading conditions, making it attractive to both retail and institutional traders.

OolongSwap implements PCV as an important mechanism for managing liquidity, controlling a portion of its liquidity. This provides a more stable base, reduces reliance on external providers, and offers greater security. while it helps the protocol grow its own liquidity through yield strategies, bonding mechanisms, and fees earned from trading activities.

Users on OolongSwap can provide liquidity to various pools and earn Liquidity Provider (LP) tokens. By staking these tokens, users earn rewards in the form of fees from trades conducted within their chosen pools. OolongSwap also offers yield farming opportunities, allowing LPs to earn additional rewards through various staking programs. These incentives are designed to encourage users to lock liquidity on the platform, thereby deepening the liquidity pools and reducing slippage during trading.

Multi-Chain Compatibility and Expansion

Although OolongSwap is native to the Boba Network, its design supports cross-chain functionality, facilitating token swaps across different networks such as Ethereum and Binance Smart Chain. This flexibility positions OolongSwap as a bridge between different blockchain ecosystems, enabling easier and faster movement of assets.

OolongSwap has introduced various advanced features that distinguish it from other DEXs:

• Bonding: Users can bond tokens at discounted rates in exchange for future yields, helping OolongSwap control and grow its liquidity.
• YOLO Pool: A novel liquidity pool where users can stake tokens with the possibility of winning larger rewards through a lottery-style mechanism.
• Lending and Borrowing: OolongSwap has expanded its services to offer decentralized lending and borrowing, enabling users to access liquidity or earn interest on their assets.

As the native DEX on Boba Network, OolongSwap helps to provide liquidity and facilitate decentralized financial activities on the platform. It serves as a gateway for users looking to swap tokens, provide liquidity, and engage in yield farming on Boba Network’s Layer-2 infrastructure. With its unique features and efficient transaction processing, OolongSwap has become an integral part of Boba’s DeFi ecosystem.

Dynamic Pair Fees and Protocol Controlled Value (PCV)

Traditional DEXs often apply uniform transaction fees to all trading pairs, which can result in inefficiencies for pairs with varying risk profiles. OolongSwap’s fee structure allows fees to adjust based on the specific characteristics of a trading pair.

For example, higher-risk or low-liquidity pairs can carry higher fees to compensate liquidity providers for the additional risk, while more liquid pairs maintain lower fees.

The Protocol Controlled Value (PCV) mechanism further differentiates OolongSwap by allowing the protocol to own a portion of the liquidity. Unlike most DEXs that rely entirely on external liquidity providers, OolongSwap controls its own liquidity, contributing to more stable trading environments and reducing the platform’s reliance on external factors. This also enables OolongSwap to reinvest earned fees and rewards into growing the protocol, thus ensuring long-term sustainability.

Highlights

• OolongSwap is Boba Network’s first native DEX, offering low-cost trading, liquidity provision, and DeFi participation via an Automated Market Maker (AMM) model.
• Key features include dynamic pair fees, which adjust transaction costs based on liquidity and risk, and Protocol Controlled Value (PCV) for more stable liquidity management.
• Users can provide liquidity, stake LP tokens, and participate in yield farming to earn rewards, enhancing liquidity depth and reducing slippage.
• OolongSwap supports cross-chain functionality, enabling token swaps between networks like Ethereum and Binance Smart Chain, positioning it as a multichain bridge.
• OolongSwap plays a central role in Boba Network’s DeFi ecosystem by bootstrapping liquidity and providing an efficient platform for decentralized financial activities.