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Top Cosmos-based DEX Osmosis Launches Stablecoin Trading Protocol
Cosmos-powered DEX Osmosis launched a new feature called stableswap, which allows users to trade a broad range of stablecoins.
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Osmosis, a Cosmos-based DEX, launched a stableswap that allows users to trade several stablecoins. The new feature lets users buy and sell a wide range of centralized stablecoins like USDC, USDT, BUSD, as well as those that are new to the Cosmos ecosystem.
Osmosis Introduces Stablecoin Trading Exchange as Part of the New Upgrade
Cosmos-powered decentralized exchange (DEX) Osmosis has rolled out a protocol that allows the trading of stablecoins known as stableswap. With the new feature, Osmosis aims to provide Cosmos traders with a broad range of stablecoins, both centralized and backed by crypto tokens.
“We want to support multiple stablecoins in the Cosmos ecosystem — both larger centralized stablecoins (like USDC, USDT, BUSD), as well as some of the newer stablecoins in the Cosmos ecosystem.”
– Sunny Agarwal, founder of Osmosis.
Similar to other stablecoin bourses, the stableswap utilizes a “curve algorithm” that collects tokens in asset pools allowing traders to exchange a high number of tokens with low price fluctuations. According to DeFi total value (TVL) aggregator DeFiLlama, Osmosis is the largest Cosmos-based DEX in daily volume, with $177 million in assets under management (AuM).
The stableswap launch comes as a part of Osmosis’ latest v13 upgrade which brought a range of features, including IBC rate limiting, multi-hop discounts, and more. With the stableswap, Osmosis users can “create liquidity pools that are more optimized for pairs that are intended to be tightly correlated,” the DEX said in a Medium post earlier this month.
“Examples of this could be stablecoin pairs like USDC / BUSD or different representations of the same asset, like axlWETH / grav.WETH. In these cases, the assets in the pairing are expected to trade very tightly within a 1:1 ratio.”
Osmosis v13.0.0 — Fluorine Upgrade
Another helpful feature that stableswap brings is the ability to set different scaling factors for assets with a pricing ratio other than 1:1. The ability to make such customizations can be handy for multiple assets, Osmosis noted, such as staking derivatives and leveraged assets.
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Cosmos Welcomes New Stablecoins
The launch of stableswap comes after several Ethereum-powered stablecoins like USDC, USDT, BUSD, and DAI have found their way into Cosmos. Earlier this year, USDC issuer Circle announced plans to launch on Cosmos in Q1 2023 natively.
As Cosmos continues its rapid expansion, the use cases of stableswap pools will also increase, Osmosis noted. The DEX added that developers can create pools of different stablecoins, similar to Curve’s 3pool.
In October, Cosmos revealed a critical vulnerability in IBC-enabled Cosmos chains. The flaw was discovered after a comprehensive audit by Cosmos and Osmosis teams into IBC in the wake of a major BNB hack two months ago.
Which feature of the new Osmosis v13 upgrade did you find most interesting? Let us know in the comments below.
Tim Fries
Tim Fries is the cofounder of The Tokenist. He has a B. Sc. in Mechanical Engineering from the University of Michigan, and an MBA from the University of Chicago Booth School of Business. Tim served as a Senior Associate on the investment team at RW Baird's US Private Equity division, and is also the co-founder of Protective Technologies Capital, an investment firm specializing in sensing, protection and control solutions.
