In an interview with CoinDesk back in 2020, a U.S. CFTC official said DeFi couldn’t be brushed off for what it represents. If anything, he was impressed by all innovations ongoing in Ethereum.
For what’s there, DeFi could be used to greatly stabilize the world’s economy.
And he was right.
Increasingly, DeFi is finding use in the real world, allowing millions of people to access financial services. As such, it is quickly emerging as a better alternative to the walled garden of traditional finance dominated by elites and monopolies.
Although the role of the legacy financial systems can’t be watered-down, they are painfully out of touch with the needs of the digital world.
It is why there is a rapid expansion of alternative solutions in different public chains. Amid the growth, Fantom, a specialized DeFi platform, is a top choice for financial solutions planning to offer better tools and services to the masses.
Numbers don’t lie.
The growth of DeFi in Fantom
By mid-January 2022, over $240 billion of assets were locked in various DeFi protocols. While Ethereum had the lion’s share, emerging, highly scalable, and secure platforms also commanded a decent portion.
Out of this stiff, Fantom is one of the most popular mentioned in the same breath as Solana and other emerging networks. Considering how aggressive Fantom is in their incentivization campaign, Fantom’s dApps manages over $6.8 billion and will continue growing.
In August 2021, they announced a mammoth 370 million FTM campaign to draw developers into its ecosystem. For their contribution, they would be rewarded with FTM tokens.
Fantom’s effort is already paying dividends, and SpiritSwap is already leveraging its DAG architecture, further expanding the scalable and interoperable network.
SpiritSwap developers are convinced everyone has an inner DeFi spirit, a belief they want to maximize.
In a network that’s already incentivizing developers when they build, SpiritSwap is further expanding income streams by introducing a revenue-sharing mechanism through the Automated Market Maker (AMM) model.
The protocol is a decentralized exchange (DEX) operating from the Fantom Opera Chain and tapping on the AMM model to facilitate cheap swaps of supported tokens. Like in similar models, pricing is determined along a curve. Liquidity providers receive a share of the pool’s trading fee.
Swappers have to move migrate to the Opera Chain to use SpiritSwap. Already, the platform has laid out how to transfer tokens from Ethereum and the Binance Smart Chain (BSC) via a Bridger enabled by the multichain, AnySwap.
Notably, MetaMask is compatible with Opera. Therefore, it is effortless to switch networks, boosting user experience.
SpiritSwap is offering several features to its users. They are:
- Swapping: users can quickly and cheaply swap between tokens via their supported decentralized liquidity pools. The DEX charges a 0.30 percent fee for all swapping operations.
- Liquidity provision where suppliers of assets in a given pool receive a share of the transaction fee depending on the pool’s activity. Because of the AMM model, suppliers of assets receive liquidity provider (LP) tokens which, like in other AMM-reliant DEXes, can be used to participate in yield farming. The LP earns 0.25 percent of the swapping fee. Notably, the remaining 0.05 percent of the swapping fee is channeled to SpiritSwap’s fee vault in the LP tokens of a specific pool before being liquidated to SPIRIT—the DEX’s native token—and distributed to liquidity providers on top of their initial principal amount.
- Farming: This is enabled by the ecosystem’s ability to mint out LP tokens because of their use of the AMM model. While LP tokens can be staked in yield farming protocols for even more reward indirectly boosting their native token’s liquidity, SpiritSwap’s developers are keen on supporting Fantom’s mission. Accordingly, they have stated clearly that they only prioritize farms leveraging Fantom’s rails. Yield farmers receive SPIRIT depending on their contribution to the original liquidity pool enabling the smooth operation of the DEX.
In addition to the above, SpiritSwap has two other tokens:
- InSPIRIT is a non-transferable token to serve the governance needs of the DEX. Holders participating in voting receive participation rewards, boosted SPIRIT farming rewards of up to 2.5X, and more voting power—where one inSPIRIT equals one vote. Users have to stake their SPIRIT tokens for a specified period to earn inSPIRIT. The longer the staking period, the more inspirit received. Holders of inspirit can vote once a week to determine the distribution of farm emissions allocation.
- The wrapped version of the typically non-transferable inspirit token is called winSPIRIT. Currently, there are two wrapped versions of winSPIRIT present in Grim Finance (ginSPIRIT) and Liquid Driver (linSPIRIT). Autofarms create wrapped inSPIRIT by looking at their SPIRIT tokens forever, therefore, boosting their boosted farming reward vaults and thus earning more. As aforementioned, staking SPIRIT qualifies holders to receive a boosted farming reward of up to 2.5X. Autofarms are designed to perpetually accumulate inSPIRIT by offering winSPIRIT in exchange for SPIRIT tokens. Even so, while there benefits of accelerated reward gains—one of the main attractions to the DEX—holders of wrapped SPIRIT can’t vote, receive airdrops, risks of the wrapper having a flaw impacting its smart contracts, and there are chances of winSPIRIT falling below market SPIRIT rates when there is a spike in selling pressure.
By mid-January 2021, SpiritSwap had a Total Value Locked (TVL) of over $370 million.
The SpiritSwap Team
The team developing SpiritSwap is experienced and primarily based in Argentina. Robert Neir is the co-founder. There are five other developers working on the project. It should be noted that the SpiritSwap team received a grant from the Fantom Foundation, which allowed them to quickly launch and gain traction.
Over the past six months, the team has been active, striking valuable partnerships.
They already have joined hands with Ola Finance, allowing lending and borrowing straight from SpiritSwap, Starter—a multichain launching pad on the BSC and Polygon–to deliver a new means of fundraising in Fantom, Liquid Driver to bring new liquidity from Fantom, and Olympus DAO.
Besides, SpiritSwap has support from Gelator Network, Popsicle Finance, and more. All of them are keen on seeing the DEX succeed.
SpiritSwap Tokenomics and Market Performance
The SPIRIT utility token complies with the FRC-20 standard of the Fantom ecosystem.
SPIRIT serves the following roles:
- Staking where users receive extra SPIRIT tokens purchased at spot market rates from the 17 percent of SpiritSwap trading fees.
- Yield farming where rewards are distributed in SPIRIT from SPIRIT-LP tokens representing a share of the pool.
- Voting by staking SPIRIT and receiving inSPIRIT—qualifying the user to even more rewards.
There are 1 billion SPIRIT tokens, of which slightly over 300 million are in circulation as of mid-January 2022.
SPIRIT distribution is as follows:
- Yield Farming receives 81.82 percent of the total supply, where 11 SPIRIT are currently released every block at a decreasing rate.
- DAO is allocated 8.18 percent of the total supply
- Project Development has a share of 7.5 percent and is vested for four years.
- Airdrops receive 2.5 percent—however, this has been completed.
There was no SPIRIT sale. Instead, allocated tokens were distributed via airdrops. SPIRIT can be earned by supplying liquidity.
From the slightly over 300.5 million SPIRIT in circulation, each token is trading at $0.29 for $87,252,043 in market capitalization.
The SPIRIT token is available for trading at Gate.io and MEXC centralized exchanges. However, the token is primarily traded from SpiritSwap, paired with other coins like USDT, USDT, wFTM, and more.
The SPIRIT token is up 16X from July 2021 lows at spot rates.
- DeFi is enormous and could expand even more in Fantom as its developers are aggressive with their incentivization program. By launching on the highly scalable and secure DAG protocol, the DEX could be a go-to protocol for swapping tokens, pumping SPIRIT.
- The development team is gifted and lean. Robert tags his experience working in traditional finance and excellent programming skills to take the project forward. The quality of the public team is a factor that could see SPIRIT surge in the months ahead.
- The Fantom Foundation saw the value the creators of SpiritSwap brought to the table and funded it. SpiritSwap received a grant from Fantom show that its potential is massive, a fact that would move SPIRIT.
- Already, SPIRIT is listed on CoinMarketCap and other trackers, boosting confidence and allowing users to scan the token’s performance easily.
- Despite the bear market traced to mid-Q4 2021, SPIRIT token holders are up 16X after prices bottomed up in late July 2021. The resilience of the token against solid selling pressure to sustain bulls is an indicator of quality and determination from the market to prop it regardless of turbulent market conditions.
- SPIRIT tokens were fairly launched through airdrops. The rejection of lower lows in the past few weeks is primarily due to the HODLing community of SpiritSwap token holders—a net positive for SPIRIT going forward. As such, its tokenomics is community-facing and likely distributed to holders who are genuinely desirous of seeing the DEX and its products succeed in the long term.
- The SpiritSwap community is vibrant and engaging. The project has over 36k followers on Twitter and an even larger following on Reddit and Discord. It is a big stamp of approval for a blockchain project reliant on the community for survival.
- SpiritSwap’s boosted farming rewards also encourage the staking of SPIRIT, directly drawing tokens from circulation, supporting prices.
- The exchange is decentralized, and inSPIRIT holders vote weekly on how to allocate boosted farming rewards. This is massive and signals the project’s leaning on shared success.
- SpiritSwap is building alliances, joining forces with Olympus DAO, Starter, Zapper, and Ola Finance, increasing user experience, and encouraging them to use the platform for more use cases like lending and borrowing, and Bonds—new features which the community has welcomed.
- In partnership with AnySwap, transferring tokens from the BSC and Ethereummeans rewards. The multichain exchange, AnySwap, has a default faucet that rewards users with 0.4 FTM to help offset transaction fees incurred.
- SpiritSwap’s code is safe, audited by MixBytes—made up of a team of experienced developers.
- SpiritSwap funds are secure following the introduction of a multi-signature feature.
- The team is also introducing new products with the ApeMode being the latest in early January 2022.