With gas prices on Ethereum still above 100 Gwei, I’ve been looking for L2 farming opportunities this past week to avoid high transaction costs. Aside from the Loopring L2 AMM liquidity mining program we covered weeks ago, it’s been a challenge finding an opportunity with an app that has a reputable team and built on a secure, decentralized platform. Like all DeFi apps, there’s always risk to consider but my search did lead me to QuickSwap, a newer AMM built on the Layer 2 solution Matic. QuickSwap is a fork of the most popular AMM in DeFi today, Uniswap, but what’s remarkable about it is that it’s built on Layer 2 with the Matic Network (now rebranded as Polygon). QuickSwap has a very familiar user interface for swapping tokens at market rates dictated by liquidity pools and arbitrageurs. Instead of paying high transaction fees, you can pay pennies per transaction on Matic, but still enjoy the greater decentralization and security benefits of Ethereum.
The most interesting development since mid-January 2021 is that QuickSwap has surged from barely $500k in liquidity to nearly $10.8M, while daily trade volume has recently hit an all-time high of $6.6M on February 16th. I would bet its growth has correlated with the rising price of gas on Ethereum L1.
If you’ve participated in Uniswap or SushiSwap liquidity mining, you know the drill already! QuickSwap is offering QUICK governance token rewards in exchange for providing liquidity to QuickSwap. Let’s hop right into how this all works since it will require most to migrate funds from the Ethereum Mainnet (L1) to the Matic Network (L2) to participate in QuickSwap liquidity mining.
How to Earn 300-700% APY Liquidity Mining on L2 with QuickSwap
Before we get started, please be aware of a few major risks.
- Smart contract risk is always my top concern. Like any DeFi app, QuickSwap may have a bug in its code.
- As an LP, one can experience impermanent loss assuming the 2 tokens in the LP don’t remain in perfect 1:1 correlation.
- Be aware the APYs I quote below will likely change by a little or a lot whenever you read this. The APY is very dependent on the price of QUICK, which could go up or down.
- As always, this is not financial advice.
Here’s how to farm QUICK on L2 with QuickSwap!
1 – First, you’re going to need MATIC to transact. Similar to needing ETH to pay gas fees on Ethereum L1, you’ll need to buy some MATIC from a DEX like Zapper Exchange. It’s about $0.11 and will be relabeled Polygon with the old ticker for MATIC still.
2 – Next, assuming you use MetaMask, we need to set up MetaMask for Matic mainnet (custom RPC/Mapping mainnet).
- Click on the network selection button on the top of the app.
- Click on the “Custom RPC” to add the Matic mainnet information.
- Select “Custom RPC”.
- After clicking “Custom RPC”, a screen will appear allowing you to set up the custom RPC for Matic Network.
- Enter in the Matic mainnet details as follows and be sure you don’t misspell any of the details below or this will NOT WORK!
- Once you’ve added the details click on the “Save” button. You’ll then be connected to the Matic mainnet.
- You can now close the dialog box.
3 – Now we need to migrate some MATIC and maybe another asset if you’d like (ie ETH) from Ethereum L1 to Matic (Polygon) L2. Go…
Hi! My name is Lark Davis!
I’m a cryptocurrency investor with years of experience and I’ve been making consistent profits in the crypto space.
I’m passionate about helping others do the same, so I run multiple educational channels on crypto investing.
