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Dear Cardano Crypto Fans, Mark Your Calendars for a SundaeSwap Catalyst on Jan. 20

Editor’s note: This article was updated on Feb. 8 to clarify that SundaeSwap was not the first decentralized exchange (DEX) to launch on Cardano. However, since its launch, SundaeSwap now accounts for more than 95% of the total value locked on the Cardano chain. 

While Cardano (CCC:ADA-USD) is in the red today, the ADA crypto has still appreciated by more than 25% the past week. According to CoinMarketCap, Cardano is the fifth-largest cryptocurrency, boasting a market capitalization of $47.9 billion. The Cardano crypto is roughly $29 billion away from catching up to Binance Coin (CCC:BNB-USD) for fourth place.

Cardano (ADA) token with blue and orange digital background.
Source: Stanslavs / Shutterstock

Cardano’s recent price acceleration can be explained by the upcoming launch of its SundaeSwap (CCC:SUNDAE-USD) decentralized exchange (DEX). In a tweet posted last Sunday, SundaeSwap’s developers confirmed that the DEX will launch on Jan. 20 in a fully functional beta form. While SundaeSwap is not the first DEX to launch on Cardano, many expect it to be the first to grab mainstream use.

Like other decentralized exchanges, SundaeSwap will use smart contracts to verify token trades from users. A portion of the trading fees will go back to investors who provide liquidity to the platform in the form of yield farming. Yield farming is similar to staking. The practice involves lending cryptocurrency to get rewards in the form of transaction fees or interest.

Since SundaeSwap is launching in beta form, features may be limited. For example, trades may take “hours to days to process at first.” Furthermore, the Cardano team explained that:

“While the DEX’s smart contracts have been fully audited and the DEX will meet all industry standards for security, the implementation of fully decentralized governance will not be immediately possible due to existing transaction size limits on the Cardano blockchain.”

Cardano Crypto News: What Is the SUNDAE Token?

The SUNDAE token will be the native token of SundaeSwap. Users will be able to acquire the token in three different ways: yield farming, exchange-based conversion and through an initial stake pooling offering (ISO) round. The first ISO round will occur on Jan. 25 and will represent a five-day reward cycle in which users can delegate their ADA crypto into a stake pool. In total, the five ISO rounds will constitute 5% of SUNDAE’s total supply. SundaeSwap added that, “ISO participants must delegate ADA to qualifying ISO Scoopers prior to 21:45 UTC on January 25th to be able to earn SUNDAE for all five ISO rounds.”

Furthermore, yield farming for SUNDAE will begin on the same day of SundaeSwap’s launch. SundaeSwap’s team notes that yield farming will be available for at least six months. Over those six months, 500,000 SUNDAE tokens will be allocated daily to yield farmers who participate in four liquidity pools. Those pools are SUNDAE/ADA, LQ/ADA, WMT/ADA and CARDS/ADA.

On the date of publication, Eddie Pan did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.


Article printed from InvestorPlace Media, https://investorplace.com/2022/01/dear-cardano-crypto-fans-mark-your-calendars-for-a-sundaeswap-catalyst-on-jan-20/.

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