AshSwap believes that after a while of experiencing the Testnet, reading the documents, and especially our Litepaper, you will have many questions and concerns that need to be answered by the AshSwap team.
So we decided to hold an AMA to help us get to know each other better and then move forward together on the wonderful journey we are about to take.
We have selected the 5 most interesting questions from the form and answered them first. After that, we will answer 3 more on the spot. If you have any, please prepare them and be ready for the later part.
Questions 1: Will there be stake pools for different projects’ IDO’s?
Answer: This is the question that we are asked regularly, and it is a common misunderstanding when people hear about a DEX. Let’s clear this once and for all. AshSwap is a stable swap, which means that it is specifically designed to facilitate trading between assets that have stable prices. For instance, USDT and USDC have the same inherent value ($1), and there should not be a big price difference between them.
The underlying mechanism (StableSwap invariant) allows AshSwap to provide a better exchange rate with extremely less liquidity compared to normal DEXs like Maiar which use the constant product method. Some simulations show the liquidity on stable-swap can be 10 times lower.
Though we only support stable trading at the beginning. We do not rule out the possibility of enabling trading between unstable pairs in the future.
Question 2: The majority of investors are focused on the price of the token in short term instead of understanding the real value & use case of the project. Could you tell us the benefits for investors to hold in long term?
Answer: As far as we are concerned, all crypto projects have this problem, and the most efficient way to tackle this is to bring more use cases to the table and embed some game theory mechanisms in the design.
Let’s talk first about use cases. $ASH tokens have the same two use cases as the mighty $CRV of Curve Finance. Users can stake ASH to earn 50% of the trading fees from all pools as well as later vote in the DAO to control the development directions of AshSwap. These alone are very strong as we can see Curve has grown to become the DEX that has the most liquidity on Ethereum, and the value of CRV token is now in the top 100 with the potential to increase more as blockchain adoption grows.
But ASH does not stop there, it has a central role in the minting of $AOC, the native stablecoin on Elrond and AshSwap. Users can generate significantly better yields if they choose to mint AOC and use it to participate in other DeFi protocols. And in order to mint AOC, they need to pay some ASH fee, this creates a constant buying pressure. If the ASH price ever decreases too much, AOC minters are even more encouraged to mint more with less fee and drive the price upward as they do so. If the price of ASH is too high, they might pay less, but in that case, AshSwap can get more revenue and distribute it back to ASH stakers and use it to help the price when it falls. Either way, ASH holders are rewarded. It’s game theory right there.
Question 3: Smart contracts are susceptible to attacks & projects fall victim to these exploitations, costing users money & project discrediting. How reliable/secure is your project? Have u tested it well enough to withstand attacks?
Answer: We at AshSwap take the security of the protocol very seriously. Everything is under constant scrutiny to make sure users’ funds are SAFU. Even though Curve’s contracts are battle-tested, we can never be too careful. As you can see we have not open-sourced our contract code yet as we want to make sure everything works as expected and does not have any trivial errors that can be exploited.
We also understand that Elrond’s smart contracts are a whole new thing and there can be something that we can miss no matter how close we look, so we will work with the Elrond team to put the contracts through serious audits before launching them on Mainnet. Bug bounties are also in consideration, and if you are developers who are well-versed with smart contract security, we would love to have you participating in this.
Question 4: “To incentivize retail, we want to integrate multiple products into our ecosystem that do not require users to put up a large amount of capital but still provide good rewards. “ I’m curious how you will incentivize retail how put liquidity in since they usually put a small amount. How will Ashswap convince liquidity providers that their liquidity is safe and the smart contracts won’t be exploited, as has happened with many DEX’s. We trust Elrond team with our funds, but Ashswap needs to earn Elrond community trust in the beginning. It’s not clear to me how you can have up to 2% impermanent loss even with a stablecoin pair. I see you changed the token name before it was ASC now AOC.
Answer:
We have talked about this in our Litepaper, but there can be some confusion, so let me be more clear here. We incentivize our users, both liquidity providers, and ASH holders, with trading fees and token distribution. But these incentives are proportional to users’ liquidity amount and token holdings, which is fair, but it does not acknowledge other contributions of communities in intangible ways. For example, you can be a retail investor with only $100 at your expense but a huge supporter of the project by understanding the mechanism, teaching newcomers, spreading the information of the project on social media, or being in love using the exchange. We can have some programs to reward you with gamification, NFT distribution, or airdrop if possible.
For a 2% impermanent loss to happen, the price difference between 2 tokens needs to be larger than 50%. “It is very unlikely this event (50% change in the relative prices of stablecoins in the pool) will happen. If it does, we crypto community has a much bigger issue to deal with than impermanent loss.” (AshSwap’s Litepaper).
Yes sir, we now have AshSwap One Coin which is as powerful as Sauron’s One Ring!
Question 5: The final question(s) are from multiple users but have the same theme about the next directions of the project such as partnerships, the team, and wen Lambo.
Answer: AshSwap’s team is working very hard not just on the code front but also on the marketing/biz dev one. We very well understand that we cannot be alone on our journey and need to partner up with others. Many things are worked on behind the scene at the moment. Some partnerships will be officially announced as the project grows. Some might be sooner than you expect.
Also, if you are someone building on Elrond, we are very open to helping or working with you to strengthen the Elrond ecosystem.
Our team is not officially doxxed at the moment, but we are not completely anonymous. If you look closely, you will find us ;). At least you already saw Nate and Erik’s faces, right? And there is a very high probability you will see the rest of the team soon.
The wen lambo one, we might not be the suitable one to answer, any volunteer?
3 On-the-spot questions from the community
Question 1 from @vitalefa: How many are you? Can we have a presentation of each member of the team? Role etc etc?
Answer: As addressed in the fifth question(s), this is not the best time to doxx the team just yet. But you will see us in the very near future. Maybe a live AMA some time?
Question 2 from @Petcel: So $ASH trading pairs will be possible? Like $water/$ash pair?
Answer: Of course, there will be $ASH trading pair, but not directly on AshSwap site. When we launch our token, we will certainly create ASH/EGLD or/and ASH/USDC pools on Maiar exchange so you can have a market to buy and sell the tokens. As for the other pairs, we live in a decentralized world, don’t we? So anyone can create any pair ($ASH with other tokens) they want on Maiar. Maybe you can be the first one to do so @Petcel?
Question 3 from @pradeep: if I test ashswap testnet will I get an incentive reward for that?
Answer: All I can say at the moment is there’s a high probability that it will happen. Serving AshSwap’s community is always on top of our priority list. @NateQ | AshSwap and @Erik | AshSwap have been very innovative with all the Discord roles and the Ambassador program. You will see all of these in the coming days/weeks. Be prepared for the waves guys. I have also answered this once in the ❓・faq channel, so you can read more about that if you want.
Bonus Question: NFT distribution was mentioned for true project Supporters. So $Ash is working on NFT too? If yes what’s the possibility of minting one with $ash?
Answer: This is a bonus for @Petcel our deer friend in purple. Yes, we are working on some NFTs and a lot of ideas for use cases and mechanisms. The details are not yet finalized as we want to give our best with this, not just making it a simple art NFT collection (of course they’re very “art” as we have a very talented artist @Hoang Le | AshSwap in the team). The details will be revealed when they’re ready. Cheers folks!
