The first ever Initial Decentralized Exchange Offering (IDO) of Raven Protocol took place on Binance DEX on June 17th 2019. At the time, decentralized exchanges, or DEXs, had yet to gain much traction in the market. With the explosion of DeFi in 2020, DEXs increased in popularity, and IDOs became an inexpensive way to get around the centralized initial exchange offering model.
While IDOs on Uniswap certainly decreased the initial expense for a project’s token listing, that convenience came at a steep cost. The crypto community quickly adjusted to this new token launch mechanism. Savvy investors began to front-run listings immediately after a large amount of liquidity was provided to a Uniswap pool. Some would purchase the entire pool in one swoop, causing the crypto asset to soar in price as others attempted to do the same. The term “ape in” to a liquidity pool was born to describe those who turned up the gas on their MetaMask wallet to buy out entire pools of newly-created tokens at lower prices before others did the same.
The above in turn produced wild volatility and left many investors shell-shocked, additionally, this approach suffers from other significant downsides, most notably;
Projects need to provide liquidity on both the asset for sale (base currency) and a quote currency (usually ETH) for it to initially trade against.
Automated market makers, such as the one powering Uniswap, would dynamically adjust the asset’s price based on supply and demand.
Increasing popularity and usage of platforms such as Uniswap reinforced scalability issues, with Ethereum network fees skyrocketing and slow platform performance, leaving end-users frustrated.
Users are increasingly demanding;
Secure, ultra-fast swaps
The possibility to buy and move assets between blockchains
The killer features of Polkastarter is the possibility of making both fixed swap pools and cross-chain swaps, powered by the Polkadot ecosystem, which can provide higher throughput for faster and cheaper transactions while staying connected to the Ethereum Network and other blockchains for liquidity.
The future of decentralized finance won’t be tied to one chain and interoperability is already becoming a must-have feature of the DeFi future.