Overview of the Arbitrum ecosystem

As the crypto market experienced a downward trend, as it has, the Total Value Locked (TVL) decreased. It was only Arbitrum that had increased and overtaken the likes of Avax and Polygon, to become the fourth TVL ecosystem after Ethereum, BNB chain, and Tron.

Most of these TVLs came from GMX, a derivative of DEX, which has made the real yield story extremely hot in the past few months.

In addition to GMX, multichain protocols such as Curve, Uniswap, Stargate, and AAVE still account for most of the TVL on Arbitrum.

However, Swapfish, a native protocol, continues to experience prominent growth recently as its TVL has increased to $56m after just two weeks since launch.

Users can now track Swapfish token balances on DePocket App

Swapfish overview

Swapfish is a native DEX on Arbitrum operating under the AMM mechanism like Uniswap, and audited by Solidproof.io, with its KYC controlled by Solidity.finance.

Details of Swapfish audit: https://docs.swapfish.fi/security/audit-kyc-and-rugdoc-review

Tokenomics

Total Supply: 100M FISH

Pre-mint: 100,000 FISH

Circulation supply: 2M => Marketcap ~ $1.9M

Marketcap/TVL ratio is currently very low ~ 0.034

The majority of tokens will be used as farming rewards for users who provide liquidity on the protocol. The team’s tokens will be locked for six months.

Currently, FISH tokens have no real significant benefit apart from being used to Stake and receive more tokens in order to participate in the lottery on the protocol.

Volume and Liquidity

FISH currently has a trade volume of: ~ $1M / Day on Swapfish, with the liquidity of two pools being FISH/USDC and WETH/FISH, at about $1M.

At present, Swapfish has the best TVL growth rate in the Arbitrum ecosystem thanks largely to an effective liquidity attraction program.

Currently, the number of tokens being emitted per second from farming and staking is ~1.26 FISH, which is also the sole source of emissions.

=> every day there are about ~ 108K new FISH distributed. This amount is fixed and will decrease by 1% each week.

This number is currently enough to provide a high yield source for the farmer leading to the project’s TVL growth.

Opportunities/risks of farming on Swapfish

Currently there is a significant cash flow issue resulting in very little to no profit. This is causing the TVL of a project to increase from zero to several hundreds of millions of dollars, and just after a few days, much like what is experienced in an uptrend (i.e. as happened on Aurora, Celo, or Polygon, etc.).

Swapfish’s TVL did increase, albeit very slowly, meaning that the APR remained high for a relatively long period. This resulted in more stability and daily profits for the farmer.

Risks

+ Price fluctuations which cause Impermanent Loss (Temporary Loss).

+ Security risks from smart-contracts.

+ The pressure to skim profit, which comes from farmers who joined early when the token supply was increasing while the APR was decreasing over time.

In order to minimize these risks, investors should carefully observe the project’s staking wallets, liquidity pools, and team wallets in order to quickly respond to the fluctuations in Swapfish.

List of wallets compiled by DefiLearn: https://s.depocket.com/swap-Fish