The weekly spore #2 — featuring Raydium and Brave
Hola mis amigos,
Welcome to this week's episode of the weekly spore, where we are covering Raydium.io, one of the best decentralized trading platforms on the Solana blockchain, that also offers you the possibility of staking and liquidity providing, including our first ShroomZ academy video!
On top of that, we are having a first look at the new social media platform zoints.com that is built on Solana and lets content creators and communities earn money in form of $ZEE which is definitely a long-awaited mechanic in our ecosystem that drives fairness and value.
After taking a look at the market, I am finally allowed to dive into a new, thrilling topic, thanks to this week's community question from our winner and OG Member Barnaby#2264: “How does a token change blockchains? What are the mechanics involved and what impact do you predict for Solana? “
“The avenue for the evolution of DEFI” is built on the Solana blockchain and is truly one of the backbones of our ecosystem, since it offers tremendously important mechanics and features, such as:
This mechanic lets you earn passive income on your crypto for locking it up into the network, to confirm transactions in the blockchain network, and available for every currency that is using the prove-of-stake mode to process payments.
This process is also decreasing the circulating supply, which is also bullish for the price per coin since less supply is in circulation. No risk of liquidation involved at probably the smartest thing to do if you are in for the long run and not interested in selling any time soon.
For being able to use the swap mechanism on radium.io/swap or in your phantom wallet as an example, you need liquidity, reserved for exactly that, in the currency pair you want to trade. This means, everyone can provide this liquidity, so others can trade. The yield for doing that is tremendously higher since you are earning on the fees per swap and fear the possibility of having an impermanent loss.
What is impermanent loss? When you are providing liquidity, let’s say for Raydium/Solana, you need to provide both assets in the same $ valuation at that time, so let’s say $RAY and $SOL for $100 each. Let’s say Ray pumps 20% while SOL stands still.
If you now want to cash out your ratio is not 50/50 anymore, but 70/50, so the protocol is forced to swap some of your RAY back into SOL to break even, due to that your gain is due to the price going up, halved to 10% because of that.
The good news is that the yield often compensates that and you do not need to break your LP Farm since you can just HODL for as long as it takes until both bags have the same, balanced ratio again.
Watch this tutorial, created by Uncle HaZzoR regarding Raydium:
Luckily, this leads us from swapping, over trading to our next topic!
Whew, what an amazing correction, that perfectly triggered the UBZ for scooping up some cheap $SOL as covered in last week's article and now running a smooth 10–12% higher! To be honest, the market is moving so slow, that I simply cannot recommend anyone to get into huge positions as of now. My suggestion right now is to take it slow, book some profits and prepare for $PSY, Season 2, and to use some profits to treat yourself in the ongoing black Friday sales. Maybe get your family something nice for Christmas, mi amigo.
Zoints.com is a fresh social media platform that enables us all to earn with the content we create, but let me shamelessly paste the official words and announcement:
“Our social network where Creators, Communities, AND Fans can earn recurring subscription rewards via a split staking mechanism is now live on mainnet at http://zoints.com! Zoints is invite only for now.”
But you are lucky! We got some invite links for you! Just reply to this article in our Discord >PSY Network — ShroomZ< and tell us that you want to be part of our new sub-community to push our word in the space!
How does a token change blockchains? What are the mechanics involved and what impact do you predict for Solana?
One of the hottest topics surely is Brave moving from ETH to Solana and the impact that has on our ecosystem as a whole. Well, Brave is displayed as the third most used browser, after Chroma and Opera and comes with a built in ad blocker and crypto orientated design that enables you to accept crypto ads to earn $BAT in exchange.
Speaking of that — the announcement of migrating towards Solana made $BAT surge around 20 % within 24 hours. If that isn’t bullish! Of course, things need to be built and settle down but this is one of the biggest steps towards mass adoption in combination with the Phantom wallet mobile wallet, which is right around the corner.
Mass adoption was one of the main arguments why Brave paved its way towards Solana — the fees! Solana is extremely fast and handles the best usage x fee ratio and is therefore perfectly prepared for the anticipated inflow of new users due to this news.
Changing a blockchain works with sorts of a buy and burn mechanism. The exact tokenomics have to be migrated, and of course, translated into the new blockchains language and smart contracts.
Now the same currency gets minted on the new blockchain and the project itself offers the users to use a blockchain bridge that lets you deposit your old ERC-20 Token so you get an airdrop of the same amount of Tokens into your connected SPL wallet.
Simultaneously the amount of newly bridged Tokens get burnt. This also means, that most of the time you will have a period of time where the Token operates on different blockchains.
I want to finish this as it leads me to a tremendously positive thought: The future is inter blockchain transfers, the future is that all blockchains can transfer assets between each other without always having to be competition. We can all learn from each other and different use cases demand different projects and blockchain. Yes, my heart belongs to Solana. But my first one was Ethereum and without that, Solana wouldn’t be that great.
Thank you Ethereum, and thank you all for reading!
This weeks question and your chance to win this Banana ShroomZ is:
What would you want to say to your 16-year-old self?