DeFi

PancakeSwap Launches StableSwap For Stablecoin Trading

BNB Chain-based DEX PancakeSwap announced the launch of StableSwap, which aims to offer stablecoin trading pairs with lower slippage and lower trading fees.

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This StableSwap is an implementation of Curve Finance’s AMM on PancakeSwap. The trading fee is 0.04%. The first trading pair on StableSwap is HAY/BUSD.

Users will be able to swap their stablecoins or other pairs of similarly priced assets more efficiently with the same trade steps. With the StableSwap function, the trading slippage is lower than normal AMM which just uses the constant product formula, also, the trading fees are lower compared to the normal AMM as well.

Before the StableSwap is launched, HAY/BUSD liquidity and LP farm are already available on PancakeSwap in its normal v2 AMM swap.

However, since PancakeSwap is launching HAY/BUSD as the first trading pair on their StableSwap, it is likely that most users who would like to trade this pair will eventually move to the StableSwap instead of continuing using the v2 AMM swap.

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Since most trading activities of HAY/BUSD will be on the StableSwap using the Stable LP going forward, CAKE incentives should be directed to reward the Stable LP stakers for encouraging them to provide liquidity. There would be less activity for the original HAY/BUSD LP (with the v2 AMM).

This is a new step for DEX to improve liquidity. Besides, DeFi platforms like AAVE also launched their stablecoins to increase their competitiveness in the DeFi liquidity segment.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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Harold

CoinCu News

Harold

With a passion for untangling the complexities of the financial world, I've spent over four years in financial journalism, covering everything from traditional equities to the cutting edge of venture capital. "The financial markets are a fascinating puzzle," I often say, "and I love helping people make sense of them." That's what drives me to bring clear and insightful financial journalism to the readers of Coincu.