SINGAPORE — JUNE 3, 2021 — ZKSwap, a decentralized exchange (DEX) based on the ZK-Rollup layer 2 scaling solution, today announced a strategic partnership with DAFI Protocol to bring synthetic assets to its platform. ZKSwap will explore the integration of DAFI’s native token, dToken, as a possible staking reward for users. For DAFI, the partnership unlocks new opportunities for the synthetic token protocol to access and integrate with ZKSwap’s layer 2 applications for lower fees.
An integration with DAFI would enable ZKSwap to create its own synthetic dTokens to encourage staking and market participation while reducing the number of native tokens that have to be issued to reward users. Instead of relying solely on its native token, ZKSwap would be able to maximize reward distributions through the use of dZKSwap tokens, a synthetic version of dToken. By potentially reducing the number of native tokens released into circulation, DAFI could help ZKSwap mitigate inflation risks tied to new token issuance.
“With ZKSwap recently crossing $1 billion USD in total value locked up, we’re seeing exponential network growth,” said Alex Lee, Head of Development of ZKSwap. “As we scale our ecosystem, we’re looking for more effective ways to reward our early adopters and long-term contributors without diluting their value. DAFI’s distribution model is a promising solution to a common problem faced by many growth-stage blockchain networks, so we’re thrilled to partner with them to explore the use of synthetic assets on ZKSwap.”
As a synthetic asset, dZKSwap token rewards would be pegged to the ZKSwap network, with smaller incentives offered during periods of low network demand and higher incentives as demand rises. DAFI enables networks to scale effortlessly with their community. Rewarding users with synthetic assets would help ZKSwap increase liquidity and incentivize long-term community participation without unnecessary token issuance and network inflation.
In addition to helping bring synthetic assets to ZKSwap, DAFI will explore using ZKSwap to lower transaction fees for dToken reward distributions across its network. Synthetic asset airdrops, in particular, could become much more efficient for DAFI by utilizing ZKSwap’s layer 2 solution. DAFI may also leverage ZKSwap to create liquidity pools with low fees.
“ZKSwap promotes great functionalities through ZK-Rollup technology to create a seamless Layer2 DEX platform for mainstream adoption. With the features of a robust infrastructure, heightened security, extensive scalability, and high throughput, ZKSwap is establishing a high benchmark in the DeFi space. With the integration of DAFI’s synthetics through the creation of dZKS, we are confident to expand the utility of our innovative model into the Layer2 ecosystem. This will potentially transform the dynamics of how Layer2 Network works,” said Zain Rana, founder of DAFI Protocol.
Beyond exploring potential integrations between the two projects, ZKSwap and DAFI will closely collaborate to keep their respective communities informed, grow their collective communities, and drive future development.
ABOUT ZKSWAP
ZKSwap (ZKSpace) is a decentralized exchange protocol based on ZKSpeed, a Practical ZK-Rollups Solution. Developed by L2Lab, ZKSwap offers 0 gas fee and high throughput to improve the DEX user experience and help DeFi applications scale. The project is backed by Bixin Capital, SNZ Capital, FBG Capital, and Longling Capital, and fully audited by ABDK, Certik, and SlowMist.
ABOUT DAFI PROTOCOL
DAFI reinvents how every decentralized network is rewarded. By creating synthetics pegged to different decentralized networks, every blockchain and cryptocurrency can create a dToken flavor to reward their early users while still enhancing scarcity when demand is low.
DAFI can reward a network even when demand declines by issuing synthetics that will reward user’s later — instead of earlier. This approach will change the foundation of all staking, liquidity, and even social reward systems for the entire decentralized world.