How SkyPools Works? Swingby Network Explains
Swingby Network thrilled to share an article about the future of its platform and that would be SkyPools.
It was a few months back when Swingby first teased SkyPools, but as the development team has been hard at work building SkyPools, they are pleased to share a bit more about SkyPools ahead of its Q4 testnet launch.
TLDR;
- How SkyPools work
- First application of SkyPools: Swapping BTC into ERC-20 tokens
- SkyPools beyond swaps
How SkyPools works?
Swingby’s SkyBridge is a trustless cross-chain bridge that empowers liquidity to move freely between Bitcoin and EVM chains. Despite bridging over $81M of Bitcoin to Defi, Swingby believe that this is barely scratching the surface of DeFi and they want more to do.
With that, bridging BTC variants is really only the first step in a multi-hop journey in the world of Defi. Hence, we thought to ourselves – Why limit ourselves to only the first step (aka a bridge)? What if you could bridge your BTC and immediately tap into the world of Defi legos in 1 transaction?
Enter SkyPools
SkyPools is Swingby’s answer to the question. SkyPool is an upgrade to SkyBridge, giving the SkyBridge superpowers to interact with smart contracts after the bridging of Bitcoin is completed. At the heart of every Defi application is the smart contract – if you can interact with smart contracts, you unlock the power of these magical Defi legos.
Hence, by combining the best of both worlds, transactions made on SkyPools consist of 2 parts:
- 1. Bridge: Bridge Bitcoin from 1 chain to another trustlessly
- 2. Smart Contract Interaction: Interacting with smart contracts to do ANY Defi action you want
This enables us to interact with any smart contract, meaning that the possibilities are endless. Whatever Defi, NFT, Web3 application you can dream of, the SkyPools mechanism can make it happen.
To start, the first type of smart contract interaction we are launching is AMM swaps. AMM swaps are easily one of the first interactions any users have with Defi. Regardless if you are a trader, yield-farmer or just a liquidity-pool provider, AMM swaps are necessities that everyone uses. Hence, we decided to launch Skypools with AMM swaps first.
Swapping tokens via SkyPools
Using the Bridge + Smart Contract Interaction model, this is how you can swap BTC into any ERC-20 tokens via SkyPools.
(Please refer to the photo below)
(Photo courtesy of Swingby Network)
To start, the first type of smart contract interaction Swingby is launching AMM swaps. AMM swaps are easily one of the first interactions any users have with Defi. Regardless if you are a trader, yield-farmer or just a liquidity-pool provider, AMM swaps are necessities that everyone uses. Hence, the platform decided to launch Skypools with AMM swaps first.
Swapping tokens via SkyPools
Using the Bridge + Smart Contract Interaction model, this is how you can swap BTC into any ERC-20 tokens via SkyPools.
Here, the team wanted to create an experience that had the quintessential security of Swingby, coupled with the great user experience and liquidity of today’s Defi apps. Over the last year, AMMs like Uniswap and Sushi, as well as LP/AMM aggregators like 1inch and Anyswap, has created a high bar when it comes to swaps. Users have come to expect nothing less than quick and easy swaps, deep liquidity pools and low slippage.
Hence, to give users that great experience they expect, Swingby will tap on the existing liquidity pools on Uniswap, Sushi and Balancer via AMM aggregators like Anyswap and 1inch. This should give users the best of both worlds – maximal trustlessness and deep liquidity for their swaps.
To give users control over slippage, Swingby’s SkyPools UI will have slippage tolerance controls they are familiar with. Just like swapping on AMMs, if the slippage is beyond their tolerance level, the swap will not happen and users will have their funds back.
Furthermore, Swingby is adding a feature where users can eject their WBTC from the swap if users changed their mind along the way. This is particularly useful if market conditions such as price has changed, causing users to prefer holding their assets in Bitcoin instead. They will be able to eject the WBTC from the swap and have their Bitcoin in wrapped form.
With swaps coming to SkyPools, Swingby are stoked to see what kind of DeFi strategies their users will come up with to leverage on their Bitcoin holdings.
ABOUT Swingby Network
Swingby is the fastest protocol for cross-chain swaps, allowing DeFi users to move assets between blockchains without the need for a trusted party.
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