Over the last two years, the DeFi landscape went on an absolute tear, reaching a total value locked (TVL) of $250 billion at its peak. The widespread acceptance of Defi and crypto accelerated the rate of innovation across the whole decentralized ecosystem.
We mainly relied on a single platform or blockchain for an extended period to execute transactions and facilitate application development. Now, with multi-chain systems and the growth of “next-generation networks” like Solana, it doesn’t have to be the case.
The Solana ecosystem has observed massive growth, with more than 350 projects built on its blockchain. People saw the stark difference in performance and realized Solana could scale decentralized applications. As a result, the price of SOL grew by nearly 10,000% in 2021 and became one of the top cryptocurrencies in the market cap.
The potential for Solana in Defi is sky high. With high throughput and lower gas fees, innovators want to build Solana applications. As more market participants spread out in the Defi ecosystem, the demand for capital-efficient applications will go through the roof. These decentralized applications should reduce price slippage and provide better pricing for traders to execute swaps. Currently, ordinary DEXs can’t provide deep liquidity and cross-chain functionality.
So it is essential to have a DEX aggregator that can route liquidity from different exchanges in Defi and CeFi. An aggregator is like a search engine for crypto traders. It can automatically optimize swaps between different networks at a lower cost than single-chain DEXs. Such capital-efficient models are vital for overall ecosystem growth and can ensure the sustainability of many Defi applications.
The emerging DEX aggregator with a one-of-a-kind product suite for the Solana ecosystem is 1 Sol Protocol. In this article, we will discuss everything about this innovative cross-chain DEX aggregator, from technological architecture and tokenomics to competitive analysis and plans.
About 1Sol Protocol
1Sol is a cross-chain DEX aggregator designed to route liquidity from all available sources on multiple blockchain networks. Outside of Defi protocols, it can also tap into centralized exchanges and platforms to increase capital efficiency for traders.
With CeFi integrations, 1Sol users can conduct swaps in OTC markets. The in-built smart calculator of 1Sol provides the best swapping path, reducing the time and cost of optimized transactions on a decentralized exchange. 1Sol protocol saves up to 50% on time and 7% during swaps. This not only increases capital efficiency for traders but also gives them a versatile DEX trading platform that can add new chains for maximum cross-chain functionality.
1Sol Offers Better Deals by Using Multiple Swaps
The DEX aggregator uses a unique multi-swap system that leverages cross-chain aggregation to provide better solutions to traders. As almost every mainstream token has its own mapped asset on each chain, it becomes simple for 1Sol to add respective tokens to its grand token bank.
With multiple swaps, the average handling fee and slippage go down. So the number of swapped tokens will be higher. In the below illustration, we can see that the difference in curves of multiple swaps compared to single swaps is higher. This is how 1Sol can offer better swap solutions.
Source- LitePaper
Working Process of 1Sol
1Sol is a user-friendly DEX aggregator. Anyone, irrespective of their technical expertise, will easily be able to swap tokens across different blockchains. The first step to getting started on 1Sol is creating an account and adding gas credits.
Once the user selects the two tokens for swapping, the smart calculator finds the best route. It compares all the available liquidity sources and 1Sol’s grand token bank. After getting the perfect combination of swaps, the user needs to confirm the transaction. Upon confirmation, the users get back the maximum amount of the swapped tokens.
Calculation Process
About Founding Team
The CEO and project manager of 1Sol is TinTin. He has over seven years of trading experience and captures true market movers in the Defi ecosystem. TinTin is also a researcher and founded several top marketing companies.
Leading on the technical end, Croath is the development director of 1Sol. He is an active contributor to Ethereum and EOS communities. He is a blockchain developer with over seven years of experience in dealing with full-stack applications.
The third member of 1Sol’s founding team is Asahi. She is a senior solidity and rust developer for 1Sol. Previously, she used to work at a crypto wallet and Japanese art coin blockchain companies. Asahi also used to be a project leader based on algorithmic stablecoin.
Competitor Analysis
When we scope the market, we see many DEX aggregators gaining prominence in their respective ecosystems. However, they don’t have the necessary functionalities to scale and support emerging Defi applications. In the case of the 1inch protocol, the gas fee is high, given most of its trading activity happens on the Ethereum network. So it is not ideal for new investors.
In the Solana ecosystem, DAGG is one of the aggregation protocols with real-time data feed and cost-efficient swaps. But due to a lack of dev work, DAGG has not made any significant impact and failed to onboard traders and Defi users. Another Solana-based DEX that is cross-chain is Atlas. Though it uses a similar order splitting approach like 1Sol, it doesn’t have CeFi integrations.
So, when we analyze other competitors of 1Sol, there is a big difference in internal functionality between DEXs. With 1Sol having exposure to OTC markets and helping projects raise funds through private sales, it is clear 1Sol has the upper hand, at least in theory. We still need to see how it sustains for longer periods.
Tokenomics
The main purpose of 1Sol tokens is to help traders reduce fees and gain more incentives through farming and governance. When users use 1Sol tokens to conduct swaps, the amount deducted in fees will be much lesser compared to any other token. The tokens earned from fees are given back to 1Sol holders.
The token holders use their voting rights and decide on a profit-sharing percentage. For high slippage transactions, the profits are not shared. 1Sol users can also deploy their capital in farms to get high annual rewards.
The total supply or max supply of 1Sol is 100,000,000. The majority of the supply is reserved for the ecosystem(35%) and farming activities (32%). For raising investments through seed and private sales, the team allocated 11%. The remaining supply is for advisors, teams, and ecosystem partners.
Investors Details
1Sol DEX aggregator raised a total of $2.2 million in their most recent funding round. During the IDO round led by DAO Maker, the team raised $152k and sold 400k tokens at a token price of $0.38.
Six other investors participated in the seed and private investment rounds, apart from DAO Maker. They are: NGC Ventures, Bitscale Capital, Huobi Capital, Bybit, Raydium, and Axia8 Ventures.
Recent Progress
The team behind 1Sol has made incredible progress so far. After the mainnet launch, the aggregator gained more than 200k followers on social media across Twitter and Telegram. As a result, the number of addresses saw a huge uptick to 20K, which increased the transactional volume to 137M.
1Sol has also been making great partnerships with some of the best projects in the Solana ecosystem. Some current partners are Dexlab, Pyth, Raydium, Soda, Yin, Flux, and Saber. Moving forward, we will see more cross-chain features for different market segments, like lending and NFTs.
Roadmap
In 2021, the roadmap was divided into two main phases. The first phase was all about setting up the official website and doing a token airdrop for early supporters in the 1Sol community. After the airdrop, it launched the MVP version of 1Sol DEX on testnet.
In the second phase, 1Sol partnered with three popular swaps and successfully achieved it with four DEXs, including Saber, Serum, Orca, and Raydium. After the swaps were enabled, the team added a mining feature. They also tested the cross-chain aggregator on Ethereum and Polkadot networks.
In 2022, the main goals are to extend partnerships in the Solana ecosystem and enable multi swaps. The team also plans to launch the upgraded version of the smart calculator algorithm. Recently, 1Sol released a new roadmap for 2022. It mainly explores more liquidity options and personalized functions for NFT and Defi traders.
Conclusion
For Defi to be efficient and accessible for every user, it needs more DEX aggregators to support the infrastructure, especially for an ecosystem like Solana. 1Sol is rapidly becoming the go-to trading platform for cross-chain swaps because of its unique ability to use multiple swaps. It reduces price slippage and gas fees. The cost of one swap on 1Sol DEX is less than $0.0001. So it is definitely going to be attractive for traders and yield farmers. In conclusion, aggregators like 1Sol are crucial for the long-term sustainability of Defi applications. It can be the leading cross-chain DEX with proper implementation in the Solana ecosystem.
Born and brought up in India, Karthikeya Gutta is a crypto journalist and freelance contributor for ItsBlockchain. He covers various aspects of the industry with in-depth analysis and research. His passion towards blockchain and crypto ecosystem is mainly because he believes it can really change the world and help millions of people.
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