DeFi Researcher Analysis: Five Low-Popularity but Highly Innovative Decentralized Exchanges (DEX)

DeFi researcher Ignas recently listed five emerging decentralized exchanges (DEX), although Uniswap is always seen as the most innovative representative and there is high anticipation for Uniswap v4, he believes that the DEXs listed, while not well-known, are surprisingly innovative.

Original tweet by Ignas

Additional information: Uniswap has launched the aggregation platform UniswapX, featuring functions such as Gas Fee exemption, cross-chain transactions, and EVM protection.

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Maverick Protocol

• Mainnet: Ethereum, BNB Chain, zkSync Era

• Total Value Locked (TVL): $59.89 million #105

• Token Price: $0.365

• Market Cap Rank: 276

Venture capital firm Delphi Digital has identified Maverick as the most threatening challenger to Uniswap's dominance since the launch of v3, highlighting the following features:

Zero Slippage Trading

Maverick's dynamic distribution liquidity mechanism automates the disadvantages of constantly adjusting liquidity positions.

Similar to Trader Joe, funds are distributed in liquidity bins, and when liquidity in each bin is exhausted, price discovery moves to the next range, providing zero slippage trading.

Four Liquidity Mechanisms, ve Token Model

Maverick offers four dynamic liquidity deployment mechanisms:

• Right Side

• Left Side

• Bilateral

• Static

The Right Side mode allows liquidity to change deployment ranges as prices rise, while the Left Side does the opposite. Bilateral mode maximizes liquidity efficiency within a certain range, such as in the image below.

Ignas believes that Maverick's effectiveness is significant for liquidity-staked token LST and assets with low price volatility, indicating Maverick is aiming to capture the Curve market, especially as Maverick also adopts the ve token model.

Ambient

• Mainnet: Ethereum

• TVL: $5.22 million #409

• Token Price: Not yet issued

Ambient claims to be the most efficient DEX on Ethereum.

It combines the concentrated liquidity of Uniswap v3 with the broad range liquidity of v2 into the same pool, incorporating dynamic fees, Gas optimization, and more.

Ambient allows users to sign transactions off-chain through EIP-712, enabling users to pay fees with tokens in their wallet or any position they hold in Ambient, eliminating the need to always keep some ETH for Gas.

Both coin swaps and liquidity provision can be done through zero Gas transactions as mentioned above.

Shell Protocol

• Mainnet: Arbitrum

• TVL: $13.68 million #269

• Token Price: Expected to launch in the third quarter

Shell launched v1 back in 2020 and has iterated to v2. Starting from a stablecoin exchange protocol, it expanded to an NFT AMM market in April this year.

Ignas notes that Shell v2's core feature Ocean simplifies interactions between various DeFi primitives, including a single ERC-1155 ledger applicable to all tokens and a standardized accounting framework.

Ocean supports mainstream token standards like ERC-20, ERC-721, and ERC-1155, as well as markets for AMM, lending, stability, NFTs, one-sided liquidity, and more.

Shell is currently conducting a token airdrop with tokens expected to launch in the third quarter.

Swaap Finance v2

• Mainnet: Ethereum, Polygon

• TVL: $2.26 million #579

• Token Price: Not yet issued

Ignas mentioned that the main issue for liquidity providers LP is still Impermanent Loss (IL) leading to negative returns.

While Swaap v1 proved that long-term profitability for LPs is achievable, it also brought challenges like oracle delays.

Swaap v2 introduces an on-chain settlement, off-chain quoting mechanism. Even in v1, the one-year IL in WBTC/WETH/USDC pools was only 0.1%, with v2 being further optimized.

According to Swaap's technical document, Swaap v2 offers higher returns and lower risks compared to Uniswap v2.

Mangrove

• Mainnet: Polygon

• TVL: Not listed on DeFiLlama

• Token Price: Not yet issued

Mangrove has currently launched a beta version on Polygon.

Ignas highlights Mangrove's uniqueness in focusing on Total Value Unlocked (TVU) rather than TVL, indicating that liquidity providers do not need to lock funds but only provide quotes, delivering them only when the execution price is reached.

Mangrove aims to address common issues on DEXs such as slippage, reduced profits for arbitrageurs, fragmented liquidity in pools, and low capital efficiency. Its features include:

• Flexible liquidity: Liquidity funds can earn returns in other DeFi projects until the quote is accepted.

• Final quote confirmation: Quotes can be canceled in case of market deterioration.

• Elimination of monopolies: Liquidity providers can offer multiple quotes for the same asset.

Don't Be Blinded by the Bear Market

Ignas also mentioned several DEX projects he is exploring:

• Carbon: Anti-MEV, with automated trading strategies like limit orders, range orders, etc.

• Button Finance: A DEX for liquidity-staked LSD token pairs.

• Euler Finance: Soon to launch Euler Swap.

Ignas emphasizes the significant innovation in various projects within the DEX sector and urges everyone not to be blinded by the bear market, so when the bull market returns, they know where to seek maximum returns.