Surprisingly, last week’s project AUDIO has pushed its way into this week’s highest gainer spot with a 125% jump in price. Caused by an announcement that TikTok would be partnering with the project to develop a “TikTok Sounds” library, the project has been exploding. This new feature would allow Audius users to upload tracks directly to TikTok with an upcoming share feature. This week we’ll be looking at the newly released liquidity aggregator Tokemak.
Introduction
Tokemak is focused on creating sustainable Defi liquidity and capital-efficient markets through a convenient and fully decentralized market-making protocol. Factors that Tokemak finds to be the most important in obtaining sustainable yield farming are democratically sourced, sustainably produced, capital-efficient, superfluid, and encourages a deep accumulation of assets to reduce slippage to zero. Believing that liquidity mining has been an invaluable resource and extremely successful in bootstrapping liquidity during the early stages of Defi’s short history. It was and is an important stepping stone for the movement, leading to an explosion of product creation and the onboarding of millions of users. Yet bootstrapping liquidity for a new project is currently too costly and inefficient. A tokamak (with an “a”) being a reactor used in nuclear fusion for the magnetic confinement of plasma. Inside a tokamak, gases are heated to the point that they ionize into plasma, and energy is produced through the fusion of atoms. The heat from this reaction is used to produce steam and generate sustainable energy/electricity. So Tokemak (with an “e”) has been architected to gather idle tokens in order to seamlessly generate and deploy sustainable liquidity. Each asset has its own token reactor, where the protocol token, TOKE (toe-kuh), is used to direct liquidity. The native TOKE can be thought of as tokenized liquidity. When staking to a given asset’s token reactor, TOKE holders control not only where the liquidity gets directed, but also what market receives liquidity, pulling from Tokemak’s reserves of ETH and Stablecoins. Tokemak is the first protocol that allows for increased transparency and democratization of liquidity provision, with the goal of becoming the primary vessel through which liquidity can flow freely and efficiently across networks to provide a more generalized liquidity aggregator for decentralized exchanges.
Tokemak is designed to be used by anyone who wants to deposit single assets into the network to be utilized as liquidity. For liquidity providers that deposit assets into a token reactor. They’ll earn a yield on their single asset deposits in the form of the TOKE. Initially, there will be select whitelisted projects that will have a token reactor to deposit into. But eventually, this will be opened up to more projects. These assets will then get deployed as liquidity across various exchanges with various pairs, and mitigated exposure to impermanent loss. When an LP deposits assets into a reactor, they’ll receive a corresponding amount of t(Assets) which is reflective of their claim for the deposited assets. The t(Assets) are then burned upon redemption of their underlying funds. This is conceptually similar to c(Assets) on Compound or a(Assets) on Aave. Any DAOs that wish to harness Tokemak’s liquidity flow in order to…
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.
