Solana-based DEX Lifinity Surpasses $1B in Trading Volume

Solana-based decentralized exchange (DEX) Lifinity announced this week that it has surpassed one billion ($1 billion) in cumulative trading volume. The milestone achievement comes one month after the protocol raised $9.6 million in an initial decentralized offering (IDO). It also comes less than nine months into the business, with Lifinity launching back in December 2021.

Lifinity is a swap service that prides itself on being a “community-based decentralized exchange powered by a game-changing proactive market maker designed to improve capital efficiency and reduce impermanent loss.”

The project aims to generate yield and market-making fees by offering the lowest swap fees across supported trading pairs. Unlike traditional decentralized exchanges like Uniswap, Lifinity does not rely on third-party liquidity providers or token incentives. Instead, the platform utilizes protocol-owned liquidity, raised from a combination of NFT and token sales.

Lifinity investors receive reward payouts in the form of market-making and transaction fees paid out to token holders or used to perform buybacks. Notably, Lifinity’s business model has proven relatively successful with the $1 billion in trading volume milestone achieved with less than $5 million locked in the protocol’s liquidity pools.

DEX Growth Continues

Decentralized finance (DeFi) applications have received massive support and adoption over the years, especially in decentralized exchanges. Despite strong competition coming from centralized crypto trading platforms like Binance and Coinbase, the sector has continued to expand and remain relevant against the odds. 

In 2020, DEXes recorded an all-time high trading volume of 3.6 billion, a 100% increase from what the sector recorded in 2019, according to blockchain analyst firm, Dune. 

Earlier in April 2022, Uniswap, one of the top decentralized exchanges based on the Ethereum mainnet, surpassed the 1 trillion trading volume mark. The protocol revealed that it took them less than three years to achieve this milestone.