January 2023
Swapping tokens for another is a huge business. Uniswap alone saw $620B volume over the last year. The volume in DEXes is driven mainly by a few actors; manual traders, automated trading strategies, and arbitrageurs. A 2022 article by LCX estimated that approximately 70-80% of all crypto trading is driven by bots. (Footnote 1)
And bots are what ZeroSlip targets.
ZeroSlip is a novel constant exchange rate, zero slippage, zero price impact, automated market maker; a zsAMM. It’s the most gas-efficient way to trade equal assets or asset pairs whose value is the same or whose price is determined based on the same factors and will always return to equivalency over time.
Our research indicates that swaps between equal assets represent approximately 10-15% of the total trading volume on DEXes. That means approximately $2-3 billion every week of the ~$20b traded on DEXes. With fee incomes of even just 1/4th of a basis point, that represents a revenue stream of $3m a year. Insane.
And that’s not all. The swap volume of equal assets is likely to increase as the importance of stablecoins, tokenised real-world assets, and volumes, in general, increase.
So – what is ZeroSlip, and how can it capture the trading volume in equal assets?
ZeroSlip is the cheapest way to exchange equal assets (footnote 2) comprising the core zsAMM protocol plus routers and APIs for accessing the zsAMM.
ZeroSlip focuses on two things: gas efficiency and a great developer experience. We target the 70-80% automated trading volume; our core contracts are extremely gas efficient while we plan to build various routers, interfaces, and APIs for accessing ZeroSlip data and trades easily, cheaply, and at the fastest speeds possible.
ZeroSlip’s zsAMM is built for the bots & aggregators so that they can route all their orders through ZeroSlip whenever they are looking for the best price or trying to exploit the smallest arbitrage opportunity. These actors are mercenary and nobody is focusing solely on serving the mercenary market. By providing the best execution price, net of gas and fees, all bots need to trade on ZeroSlip in order to stay competitive.
Our initial research indicates at minimum +20% and up to +60% gas savings compared to alternative decentralised exchanges. This gas-saving in itself is a significant improvement that we expect will drive the majority of all bots and aggregators in the equal assets swapping space to us over time. We also see the improved gas efficiency and more adjustable fee structure compared to alternative exchanges enabling less valuable but profitable arbitrage opportunities to be executed, improving overall market efficiency and pricing transparency over time.
Ambitious? Yes. Impossible? Absolutely not. Everyone is focused on building better UX, better aggregators, better trading strategies, or more novel forks of Uniswap. Nobody is focusing on building the most efficient components of tomorrow’s trading infrastructure, especially for “niche” use cases. As the HFT craze and need for speed in the -00’s showed us, the value accrues to the infrastructure that can accommodate most traders. That’s ZeroSlip.
ZeroSlip will win this market because we are laser-focused on serving bots & aggregators only. And our team is based.
REDACTED FOR PUBLICATION
Together, we are able to execute every single component that needs to be built to enable ZeroSlip to become the de-facto leader in decentralised swap markets. REDACTED FOR PUBLICATION Both can develop in a tech stack that is used to launch ZeroSlip; Solidity + Python + Typescript (and all the necessary tooling like hardhat, chai, mocha, etc. + even Vyper & Yul). We’ve got this.
So what do we need? Money. Launching a new protocol is not free. We need money for a few reasons: