How To Use SushiSwap full guide

How To Use SushiSwap

SushiSwap made many ripples in the world of Decentralized Finance (DeFi) when, in August 2020, it forked from Uniswap. Despite the broad similarities of these platforms, SushiSwap implemented several changes to empower users through community governance. The creation of SUSHI tokens, for instance, reflects this motivation, among other things.

Over the years, the exchange has been subject to much controversy. Nonetheless, it has persevered, staying afloat and eventually emerging as a promising project. At the time of writing, SUSHI tokens are priced at $13.33, with a market capitalization of over $2 billion.

Lately we’ve been writing more guides for you to get familiar with the different DeFi platforms out there, like the Pancakeswap guide. Now let’s dive a bit deeper into SushiSwap.

What Is SushiSwap?

At the time, the main distinguishing mark between Uniswap and SushiSwap was the latter’s governance token, namely SUSHI. That is, upon owning SUSHI, you gained voting rights on SushiSwap, plus a percentage share of the transaction fee. Eventually, however, Uniswap followed suit with the UNI token, essentially diluting the difference between the two.

SushiSwap is an Automated Market Maker (AMM) protocol, similar to Uniswap, with Liquidity Pools as one of its primary aspects. To simplify the trading experience for end-users, SushiSwap does away with the Order Book model of centralized crypto-exchanges. To determine prices, the AMM functions purely on the basis of demand and supply.

On the other hand, Liquidity Pools are smart contracts holding proportional asset pairs, and representing individual markets for these assets. Users who provide liquidity to these pools earn incentivizes in SUSHI tokens.

How To Use SushiSwap?

So, how to perform swaps? Simple. In 5 easy steps, as follows:

  • Open SushiSwap
  • Connect your ERC-20 wallet, such as Metamask or WalletConnect. Apart from the token that you intend to swap, make sure you have some ETH to pay for the gas.
  • Select the tokens that you wish to swap
  • Click ‘Swap’ and validate the transaction from your wallet
  • Await the confirmation of your transaction. You can check the status using Etherscan’s block explorer.

Additional Uses of SushiSwap

Yield Farming is another method of earning rewards on SushiSwap. As such, this is a corollary of providing liquidity on the platform, since you’ll need SLP tokens to farm yield. Basically, the idea is that you lock up your assets for a certain period of time, and accordingly, gain interest.

Staking is another functionality, by which you can earn xSUSHI tokens from the SushiBar. xSUSHI holders get 9% of the fees accrued from lending services, namely Bento Box and Kashi. Furthermore, by staking SUSHI, you can also earn 0.05% of the transaction fees.

What Do SUSHI Tokens Do?

Additionally, however, SUSHI tokens are also market-tradable. You can exchange them for fiat or other cryptocurrencies on several centralized, as well as decentralized exchange platforms. Binance, FTX, and OKEx are some of the platforms where you can buy, sell, or trade SUSHI.

Conclusion on How To Use SushiSwap

In spite of these, the SUSHI token has gained wide acceptance, while SushiSwap has a host of launches lined up for this year. SushiSwap’s upgraded v3 protocol will be ‘Mirin’ and its lending platform ‘Bentobox’. A token launchpad, namely Miso, is also on the cards. Coupled with plans to work in collaboration with Yearn, the prospects of SushiSwap seem brighter than ever.

As Sushi is built on Ethereum, you might want to read more about the upcoming updates that this blockchain will publish.