In recent weeks, Decentralized Finance (DeFi) coins have been flying off the shelves. Investors continue to seek passive income growth opportunities, and the blockchain ecosystem promises the highest returns of any asset class.
However, as investors continue to wager on several protocols, it appears that one is emerging as a clear winner. Ellipsis Finance is becoming one of the largest available DeFi platforms.
Ellipsis Finance enables investors to exchange tokens on the Binance Smart Chain in a secure manner. It began as a “permitted fork” of the Curve Finance protocol.
Introduction to Ellipsis
Ellipsis is an Automated Market Maker (AMM) or exchange that allows users and other decentralized protocols to trade tokens (for example, BUSD to USDC) with minimal fees and low slippage.
The pool system utilized by the ecology is comparable to PancakeSwap and Uniswap. Investors can stake tokens in these liquidity pools, which facilitate token exchanges for users.
Users that lock the Ellipsis protocol token for up to one year will be able to vote on pool incentives, get greater returns as a limited partner, receive platform fees, and vote on the eligibility of pools to receive incentives.
Some of us may be unfamiliar with the term liquidity pool. It refers to a collection of tokens kept in smart contracts and exchanged or withdrawn at prices determined by the smart contract.
Adding liquidity to a liquidity pool allows you to earn trade fees and potential prizes. When you stake LP tokens in Ellipsis, you earn EPX from a pool as a reward.
EPX Token
The native token for Ellipsis is EPX. It has four primary functions, including as an incentive for Liquidity Providers (LP), as a means of payment, and as a store of value.
Investors can stake it on the platform and receive fees. It can also be used when an investor invests tokens in liquidity pools to participate in the gains of the EPX coin.
Please note, however, that Ellipsis finances this by collecting a transaction charge for each Bitcoin exchange. Equally divided between liquidity providers and EPX investors.
However, the newly created EPX awarded to investors is subject to a 90-day vesting period. If the tokens are removed before the end of the allotted period, the person who received them will be charged a 50% penalty.
How Do Things Work with Ellipsis Finance?
Curve Finance and Ellipsis Finance have the same model, however, there are several distinctions.
One of these is that EPX employs the AMM technique. Assets of Ellipsis will be traded via a Liquidity Pool based on a Smart Contract formula with low guaranteed slippage.
Additionally, Ellipsis utilizes a liquidity pool and compensates liquidity providers. Each transaction above Ellipsis Finance costs a small fee, of which all liquidity providers get an equal share.
A transaction fee consists of two components. The transaction pool employs half of the EPX Tokens for liquidity, while users stake the remaining half.
“The views and opinions on this Crypto News Website are solely those of the authors and contributors. These views and opinions do not necessarily represent those of iBaseTrading or its partners.”
