Cardano Launches First Decentralized Exchange Built on ADA, Triggering Price Spike
Cardano (ADA) is surging after launching the first-ever decentralized exchange (DEX) built on the smart contract platform.
According to a statement made by the SundaeSwap (SUNDAE) team, the fully functional beta version of the DEX premiered today on Cardano.
Its launch boosted Cardano from its day-low of $1.32 to $1.42, a 7.5% increase. The fifth-largest crypto asset by market cap has since stabilized and is exchanging hands at $1.40 at time of writing.
SundaeSwaps utility token, SUNDAE, allows holders to trade, stake, and lend coins as well as vote on the platforms governance protocol. The token is unique becauseits price will be determined by the community as a whole rather than just by SundaeSwap Labs, the DEXs developers.
It doesnt feel appropriate for SundaeSwap Labs, only one member of [the] community, to sell the token [at a] set price.
The initial circulating supply of the token will be sold by the DAO (decentralized autonomous organization) directly using an automated price discovery mechanism. Enter: The Taste Test.
At the launch of the protocol, 7% of the community supply of the token will be locked by the DAO into a smart contract called The Taste Test.
The Taste Test is a 10-day period where members of the community can deposit ADA or SUNDAE from their reward pools without any swapping occurring. After the 10 days, the deposited tokens will create the ADA/SUNDAE liquidity pool, which would establish the initial price of the token.
Participants can then claim the liquidity provider tokens, which represent both assets in the pool, and track their share of the pool.
SundaeSwap isnt the only new feature seen on ADA this week as the Ethereum (ETH) competitor recently ventured into the metaverse with the launch of Pavia, a play-to-earn non-fungible token (NFT) virtual reality project.
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Featured Image: Shutterstock/NextMarsMedia
