Deep Insights 06: Advantages of HurricaneSwap — Cheaper

Published on: 21.08.2021

Before introducing the cost advantage of HurricaneSwap, let’s take a look at the cost of cross-chain methods commonly adopted in the market.

If users go through a CEX, they need to deposit the assets to the exchange first, and then withdraw them to the destination chain, so that there are at least 2 steps which will generate fees. And if the user needs to purchase assets on another chain, an additional transaction fee will be charged. For example, if a user holds USDT on the BSC network, and needs to purchase Solana on the Solana chain. The user needs to transfer the USDT to Binance Exchange, purchase Solana on Binance, and then withdraw to the Solana Chain. In this way, 2 transfer gas fees and 1 trading fee for purchasing Solana will be charged.

As for the cross-chain bridge, taking BSC-Polygon cross-chain as an example, the entire path is actually to transfer BSC assets to Ethereum first, and then cross to Polygon through the Matic bridge. There are also at least 2 steps with fees, and the gas fee can be hundreds of dollars when the Ethereum network congestion occurs, which is quite expensive.

Furthermore, for some cross-chain protocols, it seems that the users only need to click a single button to easily complete the entire cross-chain process, but the protocols actually call multiple contracts behind. For example, from USDT on Heco to USDT on BSC, the exact path is USDT-MDX-HUSD-USDT. Each step will generate transaction fees, and plus the fees and slippage charged by the cross-chain protocol itself, the total fees charged will probably be more than 1%.

Roke Protocol, the LP-Bridge mechanism adopted by HurricaneSwap, has directly shifted the liquidities of popular assets of other chains to HurricaneSwap, from LP on other chains to aLP on Avalanche. And $AVAX is used as the settlement method for cross-chain transactions. The contract call fee for locking LP assets (source chain) and the aLP minting and adding fee (Avalanche chain) will be the total LP cross-chain fee. It saves at least half of transaction fees compared with current protocols.

HurricaneSwap also has great advantages in slippage. For the common cross-chain protocols, the slippage actually depends on the total asset ratio of the chains bridged. If the ratio of assets on one chain drops, it will lead to an increase in all the slippages of related cross-chain transactions. But the object of HurricaneSwap’s LP-Bridge is the LP composed of token A and token B, the transaction slippage depends on the trading volume and the K value. The greater the gap between the transaction volume and the K value, the smaller the slippage. As long as the depth of the trading pair is sufficient, the transaction slippage can be kept below 1%.

In addition, as mentioned before, the new consensus protocol of Avalanche reduces the gas fee while increasing the transaction speed, so it can reduce the overall cost for the entire ecosystem.

About HurricaneSwap

HurricaneSwap is the first decentralized cross-chain swap built on the Avalanche. With the innovative LP-bridge mechanism (Roke Protocol), HurricaneSwap provides users with a high-performance and low-fees, as well as unparalleled, seamless cross-chain trading experience.