By Nathan Ferguson
With BurgerSwap, users have access to a decentralized exchange powered by Binance Smart Chain (BSC) that enables users to trade cryptocurrencies through an automatic market maker (AMM) function.
Growing growth in decentralized finance (DeFi) has been evident over the last few months. This led to token exchange projects popping up alongside it. They have problems with liquidity and slippage, resulting in relatively high trading costs for their users. With BurgerSwap, you can address these concerns with a comprehensive set of tools.
BurgerSwap uses several incentive programs to entice people to participate in the protocol. Users will also be able to participate in more efficient trades due to increased liquidity, without paying huge gas fees.
Background
In addition to BurgerSwap, BSC is hosting the first DeFi platform. The project is aimed at making products and services available in DeFi much more affordable and reliable. Users haven’t reported any issues with the platform since its launch.
Burgerswap’s smart contracts were examined by Beosin, a reputable blockchain company dedicated to learning from the mistakes made by other platforms and their users. In this way, it reduces the risk of rug pulls from smart contracts and bugs which plagued most of DeFi’s protocols up until now. It’s still important to note, however, that storing assets in smart contracts isn’t risk-free. You should use caution whenever you transact on DeFi platforms.
What is BurgerSwap?
BSC is used as the basis for BurgerSwap, a decentralized exchange containing its own code. It enables users to carry out cryptocurrency swaps through its AMM. An AMM’s liquidity pool allows users to exchange tokens for rewards on the platform.
A primary objective of the platform is to remedy the problems associated with most Ethereum-based exchanges, such as high gas fees, price slippages, and slow transaction speeds. The BurgerSwap ETH-BSC bridge enables users to swap ERC-20 tokens easily as well.
This project’s architecture is closely related to that of PancakeSwap, BakerySwap, and many others in the same space. The BurgerSwap AMM model provides incentives to its users if they supply liquidity for the exchange.
Additionally, BurgerSwap is only one of a number of popular decentralized applications (dApps) in Binance’s ecosystem. In addition to this, BurgerSwap is an AMM platform based on community interests.
Automated Market Makers (AMM)
An automated market maker (AMM) enables peerless trading with smart contracts by means of a decentralized application (dApp). It also eliminates the need for order books, so there is no requirement that buyers take part in token swaps. This type of swap relies on AMMs to provide liquidity. Crypto assets can be lent in pairs via DeFi protocols like Ave and Compound.
Recent months have seen automated market makers (AMMs) reshape decentralized finance (DeFi). As a result of high network congestion and gas fees, making small trades on Ethereum-based protocols and participating in governance became difficult after the highly successful DEX Uniswap surpassed the daily trading volume on the most popular centralized exchange (CEX).
The decentralized Ethereum applications (dApps) are therefore often limited to large stakeholders capable of paying the fees without tarnishing their potential profits.
A copy of it has been made several times since UniSwap changed the game! In the DeFi space, online platforms such as PancakeSwap and SushiSwap have established healthy competition based on the blueprint of Uniswap. In some cases, clones face insufficient accountability and transparency. It is not uncommon for DeFi protocols to put community governance on the back burner. In addition, as providers of liquidity and reward schemes become saturated, incentives for them to invest will be reduced. It can cause potential risks to outweigh the possible rewards, particularly if you’re farming for yield.
By promoting community participation through BurgerSwap’s token (BURGER), BurgerSwap appears to be able to increase adoption.
Setting Up BurgerSwap
BurgerSwap can be set up fairly easily. Several online wallets including TrustWallet, TokenPocket, MetaMask, MathWallet, and Binance Chain will be sufficient. If you have a wallet, you can link it to the website to start trading.
The platform requires BURGER tokens for transactions to take place. The Binance Coin (BNB) or tokens can be acquired by purchasing them directly from cryptocurrency exchanges. Once you own BURGER, you can transfer your BNB to your wallet and trade them for it.
In the platform, you have the option of setting the slippage tolerance for your swaps. It refers to how much change in the price you are willing to tolerate when you conduct a swap. The percentage can be set to 0.1%, 0.5%, or 1%. These considerations also apply if you will also swap other tokens.
How to use BurgerSwap
By using BurgerSwap, you can exchange any BEP-20 token (i.e., any crypto asset that is based on the BSC). Swapping BNB for BURGER is as easy as going to Swap, entering the amount of BNB to swap, and clicking Swap. Before you swap tokens, it is crucial that you verify the Price Impact, Transaction Fee, and other details.
How to add liquidity to BurgerSwap Pool
A liquidity pool is used by BurgerSwap’s AMM. It’s a pool of cryptocurrency tokens collected from the exchange’s users and is used as a mechanism for trading and swapping tokens on the platform. Liquidity providers (LPs) are the users who supply assets for the pool. The BurgerSwap platform allows users to provide liquidity (add tokens). A new liquidity pool can be created or an existing one can be augmented using these tokens.
Click “Add Liquidity” on the Pool tab, select the token pair, and provide liquidity. A blockchain transaction is required to add liquidity to the pool by clicking the Approve button. You can now use your BurgerSwap tokens for the BurgerSwap contracts. Then you can add liquidity to the BurgerSwap contracts. A proportional amount of $BURGER tokens is given to LPs based on how many assets they lock up in liquidity pools. Since the gas fees on the blockchain require $BNB, a user needs it to provide liquidity to the platform.
In addition, make sure that you supply tokens that are on BEP-20, the Binance Smart Chain’s standard. The platform’s cross-chain bridge enables you to swap ERC-20 assets for BEP-20 tokens. In addition to the existing liquidity pools, you can create a new one for the token pair you choose. It is essential that you must deposit for both trading pairs. To provide liquidity to a token and Bitcoin pair, there needs to be a minimum percentage of token deposits. To mine BURGER tokens, you will need to use BNB and BURGER pairs. To earn BURGER rewards, it is not necessary to provide liquidity to other token pairs.
BurgerSwap Governance
Stake your BURGER tokens on the BurgerSwap Governance tab. To vote or submit a new governance proposal, you must stake your Burger tokens.
BurgerSwap Cross-Chain Bridge
You can only trade and provide liquidity on BurgerSwap using BEP-20 tokens since BurgerSwap runs on BSC. BurgerSwap does offer a Cross-Chain Bridge service that lets you wrap ANY ERC-20 token into a BEP-20 token (bToken). As in the case of tokenized bitcoins on Ethereum, here the conversion takes place between ERC-20 and BEP-20 tokens.
Burgerswap exchange supports a number of assets that aren’t native BSC tokens, including BTC, ETH, BCH, and XRP. The BSC network can only trade these tokens since they have been converted to BEP-20 tokens – either through Bridge (bTokens) or through Binance withdrawals.
The process may require switching repeatedly between Ethereum and BSC while performing the process. Furthermore, the BNB and BURGER pairs with which bTokens can be traded (bToken/BNB and bToken/BURGER) must have adequate liquidity. It is therefore necessary to monitor Price Impact before signing off on a trade. When trading pairs with low liquidity, you are likely to experience a lot of slippage.
Farming BURGER
There are BURGER, USDT, and BNB rewards with BurgerSwap. Tokens can serve two purposes: they can provide liquidity and they can participate in governance. The amount of BURGER tokens that each provider of liquidity receives will be proportionate to their share of the pool. Those who continue providing liquidity will receive prizes.
BurgerSwap will charge 0.3% trading fees on all pairs starting in November 2020, and a portion of that fee will go to liquidity providers. Also, each time a new BURGER is generated, it is allotted to them. The voting system also allows users to receive rewards for participating in project governance. In addition, BurgerSwap’s trading fees are destroyed through a burning mechanism.
These are the reward allocation rates:
- Providers of liquidity on the platform receive 40% of rewards.
- Governance/voting participants receive 30% of the rewards.
- Thirty percent of rewards are lost forever.
A variety of new proposals may be made and voted on, which could result in a change in the rates.
BURGER Token
BurgerSwap’s token (BURGER) uses the BEP-20 standard and is integrated into Binance’s smart chain. As part of BurgerSwap’s ecosystem, Burger offers many benefits, including voting on protocol updates and proposals. It also provides liquidity rewards over BURGER tokens
BURGER token supply was initially elastic. A cap of 22,000,000 Burger tokens was voted on by the community following the token listing. Furthermore, Burger tokens are exclusively issued by liquidity providers. There are 50 BURGER tokens in every block. Each miner receives a portion of this reward proportional to how much liquidity they provides as part of the protocol. A maximum of 120 Burgers and at least one Burger per block are required, but this can change through community governance.
Furthermore, BurgerSwap did not have a team allocation or pre-mine. Furthermore, 10% of each transaction fee generated through the protocol would be distributed to vested members of the team. The team outlines the long-term plans for the project, reassuring users that the tokens won’t be handed out at random.
At the close of December 2020, BURGER tokens were trading at $0.60. BURGER has since surged to to $15.52 in February 2021 due to an increase in usage. BURGER is currently priced at around $7.05.
Mining Rewards
In addition to PancakeSwap, BurgerSwap has a Binance Coin (BNB) pair as a liquidity provider. The BURGER token is also needed for liquidity providers. To qualify for rewards based on liquid assets, at least 1% of the assets impacted by a burger must be liquid. A community vote to increase or decrease this limit may change it, however. It is automatically set at 1%, with the upper limit set at 5%.
Incentives from BurgerSwap mining contribute to the platform’s growth. A user may vote to maintain a fair mining distribution, and may choose to increase or decrease the speed at which mining rewards are granted. By using this innovative approach, healthy protocol adoption is possible.
As a result, users receive tokens from liquidity providers (LP) when they provide liquidity to a pool. A token represents the stake a user holds in the pool. The BurgerSwap platform is not based on liquidity provider tokens (LPs) like most automated market makers (AMMs). This reduces the possibility of liquidity moving to another protocol.
Transaction Fees
BurgerSwap’s transaction fees are set at 0.3% from launch. BURGER tokens are issued through transaction fees accumulated in the governance pool. As part of the claim for transaction fees, each user is required to stake BURGER tokens and contribute to governance once a week to claim transaction fees. MetaMask integration for Binance Smart Chain makes this process simple.
Every time an idea for governance is created, a new proposed contract is created with the total amount of the BURGER tokens. After the proposal has ended, users will receive a portion of the rewards if they participated in the voting process. In addition, a proposal creator gets rewarded with BURGER tokens if the proposal is successful.
BurgerSwap: Why Use It?
People are turning their backs on Ethereum toward Binance Smart Chain (BSC) for a variety of reasons. This is usually a cheaper and faster option than Ethereum. The rising gas prices make Ethereum-based DeFi protocols unaffordable for many. There are transaction fees of up to 1 cent with BSC. In addition, there is a three-second confirmation time for every block. BSC also possesses a lower entry barrier than Ethereum.
Several successful projects are currently running in the Binance ecosystem, which is home to one of the biggest and most well-established blockchain communities in the world. BSC enables Solidity developers an easy transition to the BSC ecosystem thanks to its compatibility with Ethereum Virtual Machine (EVM).
BurritoSwap does not clone any other company. A BurgerSwap competitor doesn’t produce as many contracts as this project, which uses 14 existing contracts. BurgerSwap is different from similar protocols in that it was built from the ground up, unlike Uniswap. By adding this touch of authenticity, the project is likely to appeal to both current and potential users alike.
Alliance for Fast Food
The Fast Food Alliance was created as a federation of decentralized financial (DeFi) platforms built on Binance’s Smart Chain, created and coordinated by BurgerSwap’s global team. Partnerships with 7up Finance and Fry World have been recently signed.
As a result of this alliance, like-minded developers can form relationships and create synergies to improve the value of their tokens. Currently, you can stake BURGER tokens in Fry World. Yearn Finance is Binance Smart Chain’s equivalent.
It is easy for users to switch between DeFi protocols using the Binance Smart Chain MetaMask, allowing them to transfer tokens from one protocol to another. In addition, MetaMask allows users to control their own private keys, providing more decentralization for Binance. Future plans call for the Fast Food Alliance to become the chosen platform for DeFi. Transaction fees are low, throughput is high, and confirmation times are fast, as well as interoperability between the platforms.
Is BurgerSwap safe?
The first smart contract version was audited by blockchain security company Beosin in September 2020. Currently, BurgerSwap has not been reported as broken. A smart contract deposit is always risky, since it may contain bugs that were not uncovered during the code audit. Whenever you deposit funds, make sure they are not risky.
Closing thoughts
BurgerSwap became the very first DeFi project to introduce on Binance Smart Chain. The cross-chain bridge and governance system make BurgerSwap unique, despite its similarities to other platforms.
It is worth analyzing the incentive structure of decentralized exchanges (DEXs) to determine how they aim to make people support their platforms. Putting in place liquidity pools and AMMs is not enough. The market should also allow users to plow idle assets into the market and be rewarded for their contributions.
There is a promising approach to that particular aspect of BurgerSwap. In addition to using the native token, users can also earn additional tokens by using other supported cryptocurrencies. Using DeFi concepts such as yield farming and liquidity mining, consumers can maximize the returns from their holdings. Adoption is easily achievable because of the reward structure. In turn, this contributes to the project’s aim of achieving better liquidity.