Freeliquid’s guide to Waves and Swop.fi

Add to FL-USDN liquidity and earn a high APY by receiving the $SWOP farming rewards!

Hi everyone,

The Freeliquid integration into the Waves blockchain has been completed on March 26, 2021. With that, the roadmap for Q1 2021 has been finished as promised in time. The $FL and $USDFL trading pairs are now available on Waves Exchange. On Swop Finance, a FL-USDN pool has been added with its liquidity providers earning $SWOP farming rewards from April 5.

Since there have been many questions about Waves and Swop from our community, we decided to prepare a short guide below. Here, you will learn about Waves blockchain, Swop finance, how to send FL and USDFL between Waves and Ethereum networks, and finally, how to earn a double-digits APY by providing FL-USDN liquidity!

What is the Waves Protocol?

The Waves Protocol encompasses a whole ecosystem of applications built on Waves blockchain. It was founded by Sasha Ivanov back in 2016 and has consistently held itself among the most successful blockchains since then.

The Waves blockchain has many advantages such as:

  1. Fast transactions and low fees, which are fixed at 0.001–0.005 $WAVES per transaction (only a few dollar cents at current prices).
  2. Easy scalable — for example, increasing the current transaction volume by 100 will not affect the fees.
  3. The protocol is using the Ride programming language for the smart contracts, which makes it very friendly for the developers of centralized and decentralized applications. This makes the Waves ecosystem easily expandable.
  4. As a result of (3), there are already many efficient solutions on Waves — governance protocols, staking, decentralized Forex, and, recently, Swop finance!
  5. A long track record of consistent development and project’s credibility.
  6. A promising roadmap for coming months.

For further information, please visit Waves’ official website and blog. To learn about many products offered by the Waves.exchange, feel free to read the documentation.

How to create a Waves wallet and use the Ethereum-Waves bridge

Go to Waves.exchange and press “Sign up” to create an account via one of the suggested methods. As always, make sure that you safely store your credentials (or the seed phrase) and do not share them with anyone.

Go to your wallet page and click the Plus sign in the list of assets below. Pick FL and USDFL from the list and press “Pin,” if they are not among your displayed assets already. Now you should see FL and USDFL tabs added to your wallet.

Now, to transfer FL or USDFL as well as swap our tokens between Waves and Ethereum blockchains simply press “Send” or “Receive” buttons on their asset box. Make sure you are chosing the correct network and sending the minimally required amount of tokens — otherwise they will be lost! If you are sending tokens to an Ethereum address, you will also have to cover the gas fees and pay the Gateway Fee on the Waves exchange.

And that is simple as that! The Waves bridge will automatically convert tokens based on the network you choose — no further actions needed.

What is Swop Finance?

Swop Finance (Swop.fi) is a decentralized exchange powered by the Waves blockchain. In February 2021, the $SWOP token has been launched, enabling the governance of the platform by its community and incentivizing liquidity providers (LP). Swop.fi has an excellent documentation with more detailed info as well, for example, the guides and the Medium blog.

All users that add to liquidity on Swop.fi and stake their LP tokens in the farming receive $SWOP rewards. The annual percentage yield (APY) for each pair depends, obviously, on the $SWOP market price but also on the community vote. All $SWOP holders are eligible to stake their tokens in governance and assign a certain amount to a specific pair, thus increasing its APY! The rates are being recalculated each week based on the previous vote.

How to add to FL-USDN liquidity and earn $SWOP rewards

With the recent listing of FL on Swop.fi, we show how our community can benefit from the $SWOP farming rewards and potentially earn a high yield. We also encourage all $SWOP holders to support Freeliquid and vote for the FL-USDN pair in the Swop.fi governance!

To earn the $SWOP rewards:

  1. Fund your Waves wallet with $FL and $USDN and connect it on Swop.fi
  2. Go to the Pool tab, pick FL/USDN from the list and press “Add liquidity”
  3. Enter the amount of $FL and $USDN [1] that you would like to provide and press “Supply”. Mind that if you are later removing the liquidity at a different FL/USDN price ratio, your position will suffer the so-called impermanent loss [2]!
  4. After your transaction is confirmed, do not forget to stake the LP tokens in Swop farming! Otherwise, you will not receive the $SWOP rewards.
  5. After staking, you will get $SWOP tokens accrued to your account approx. every minute. Just press “Claim” to transfer them to your wallet or, alternatively, press “Stake” to automatically lock $SWOP for governance.
  6. As mentioned earlier, you can vote with the received $SWOP to further boost the APY on FL-USDN pair! Simply go to the Governance tab, stake your $SWOP, and assign your vote for FL-USDN.

We hope that guide will help our users to earn from providing liquidity to FL. All tokens ($FL, $USDFL, $USDN) are then easy to transfer to and from the Ethereum network.

Notes:

  1. Neutrino USD ($USDN) is “an algorithmic stablecoin pegged to the US dollar and backed by WAVES.” It is available for trading on many platforms including the Waves.exchange and Curve Finance.
  2. Impermanent loss(IL) is a potential “funds loss during liquidity provision.” It might happen if you deposit and withdraw liquidity at the different price ratios. For more information about the IL, please refer to many guides available on the internet, for example: one, two, three.

Freeliquid is a decentralized lending platform that offers funding in USD stablecoins for liquidity providers. https://freeliquid.io