Developed by Shytoshi Kusama, ShibaSwap is the primary DeFi platform within the Shiba Inu ecosystem. ShibaSwap was launched in 2021, taking inspiration from well-established DEXs like SushiSwap and Uniswap, but with a puppy-themed focus that sets it apart.
ShibaSwap is designed to boost the utility of the Shiba Inu tokens, offering a range of typical DeFi tools. Users can trade crypto tokens, deposit in liquidity pools, stake their coins, and vote on ShibaSwap governance proposals.
It’s a hub for the Shiba Inu community, a place where the SHIB Army can earn rewards, track their portfolios, and stay updated on the latest developments in the Shiba Inu universe.
How Does ShibaSwap Work?
ShibaSwap follows the main principles of decentralized finance by allowing anyone to access financial tools in a permissionless, trustless environment.
But ShibaSwap’s set of tricks doesn’t stop there. It’s a multifaceted platform that offers a range of services, each with its own unique mechanics. Let’s take a closer look at these features and how they work.
Swap
At its core, ShibaSwap is a decentralized exchange, and its primary function is trading Shiba Inu ecosystem tokens. This is handled by smart contracts on the Ethereum (ETH) blockchain, which allows users to trade any supported ERC-20 token directly with other users.
Beyond tokens like SHIB, BONE, and LEASH, the platform also supports a wide array of other tokens, including Polygon (MATIC) and Dai (DAI), providing users with a diverse range of trading options. The swapping process is basic, helping newbies to the DeFi space easily navigate the platform.
Dig
Continuing the Dog-theme, “Dig” is a fun way of providing liquidity to ShibaSwap. Users who add their tokens to a liquidity pool are essentially “digging” for BONE token rewards.
When you dig, you create ShibaSwap Liquidity Provider (SSLP) tokens and deposit them into a liquidity pool. These tokens represent your share in the trading pool and can be used to claim your BONE rewards.
The more liquidity you provide and the longer you leave your tokens in the pool, the more rewards you can potentially earn. This incentivizes users to contribute to ShibaSwap’s liquidity and decentralization, which helps stabilize the tokens’ prices and ensure smooth trading.
Bury
Why stake tokens when you could “Bury” them instead? “Bury” is ShibaSwap’s term for staking, another key feature of the platform. When you bury your tokens, you are temporarily removing them from circulation. In return for this, you earn rewards in the form of additional tokens.
On ShibaSwap, you can bury SHIB, LEASH, and BONE tokens. Once buried, these tokens earn returns paid out in a wrapped version of the staked tokens. For instance, if you stake LEASH or SHIB tokens, you receive xLEASH or xSHIB in return.
The rewards for burying tokens are distributed weekly, but there’s a catch. Only one-third of the rewards can be claimed immediately. The rest is locked up and vested over six months.
This prevents stakers from mercilessly dumping their rewards on the market and encourages long-term participation in the ShibaSwap platform.
Woof
“Woof” is the term used in ShibaSwap for yield farming. This is a process where users can earn additional rewards by depositing their ShibaSwap Liquidity Provider (SSLP) tokens into the platform’s yield farm pools.
When you woof, you’re essentially putting your SSLP tokens to work. These tokens you received when you provided liquidity to the platform can be deposited into specific yield farm pools to earn rewards from various crypto projects listed on ShibaSwap.
The woofing reward mechanism is similar to burying. One-third of the rewards can be claimed immediately, while the rest is locked up for six months.
What makes woofing great is that the SHIB ARMY can leverage other crypto assets like Wrapped Bitcoin (wBTC), Tether (USDT), and USD Coin (USDC) to earn a wider variety of digital currencies.
NFTs
ShibaSwap isn’t just about tokens; it’s also a platform for non-fungible tokens (NFTs). NFTs are unique digital assets that represent ownership of a specific item. NFTs are a huge part of the crypto market, and the Shiba Inu team hasn’t ignored them.
ShibaSwap was the original minting site for the “Shiboshis,” Shiba Inu’s central NFT collection. With 10,000 of them in existence, each Shiboshi is completely unique, adding a layer of rarity and collectability to these digital assets.
The Shiboshis aren’t just for show. Shiboshi holders can use their coveted puppies in Shiboshi Games, like trading card games and other community-led projects.
Vote
If you couldn’t guess, ShibaSwap is driven by community governance. This is where the “Vote” feature comes into play. By holding BONE tokens, you can join the ‘Doggy DAO’ to propose and vote on changes to the ShibaSwap protocol.
This voting power is a crucial aspect of the platform’s decentralized nature. It allows the community to have a say in the direction of ShibaSwap, making decisions on everything from what trading pairs get listed on the DEX and what rewards are received in Woof farms.