QuickSwap V3

Market Making

QuickSwap is a decentralized exchange native to Polygon that enables permissionless trading and liquidity provision (to earn trading fees). QuickSwap V3 introduces concentrated liquidity to improve capital efficiency for LPs.

Risk Rating
Average
Protocol Code Quality
Protocol Maturity
Protocol Design
Summary
What we like
QuickSwap V3 is a fork of Uniswap V3 that introduces the concentrated liquidity AMM model for users on Polygon in order to boost volumes and lower fees.
What we like less
QuickSwap V3 has a steeper learning curve given its multilpe custom parameters and increases the risk of impermanent loss for liquidity providers.
What it means for you
Offers an attractive marketplace for you to earn yield due to its high total value locked (TVL), protocol emissions, and solid volume.
Information
Exploit/Hacks
None
Info
  • Website
  • Token: QUICK
  • Tags: Market Making
Key Metrics
  • TVL: $67M (Rank #82)
  • TVL Ranking by Market Making: #0
  • Blockchain: Polygon, Manta, Polygon zkEVM, Dogechain
  • Chain TVL
    • Polygon: $42.12M
    • Manta: $18.98M
    • Polygon zkEVM: $4.4M
    • Dogechain: $1.53M
Risk Assessment
Average
Protocol Code Quality
  • Code reviewed by several experienced auditors including ABDK and Hexens
  • Public team promotes accountability
  • No documented protocol hacks since launch
Protocol Maturity
  • Latest protocol version launched in 2022; maturity over one year minimizes technical risk as smart contracts are well battle-tested
  • Top 10% by total value locked reduces risk
  • Core contracts can be upgraded with just an EOA wallet
  • No timelock exists or no information documented, which mean a malicious actor could approve upgrades without any delay
  • Low voting power concentration reduces risk
Protocol Design
  • No death spiral concerns
  • This protocol is susceptible to risks related to decentralized exchanges (DEXs), such as impermanent loss
  • Quickswap is a direct fork of Uniswap V2 implemented on the Polygon PoS chain.
Things to know about QuickSwap V3

How QuickSwap V3 works

QuickSwap V3 is an automated market maker (AMM) that introduces the concentrated liquidity AMM model and is forked from Uniswap V3 on Polygon. Concentrated liquidity is a new AMM model where liquidity is allocated within a custom price range. Previously in QuickSwap, liquidity was distributed between 0 and infinity, uniformly along the price curve. V3 allows liquidity providers (LPs) to concentrate their capital on smaller price intervals or ticks. This offers traders deeper liquidity and allows LPs to earn more with less capital required. However, this also increases impermanent loss as rising and falling asset prices can result in the position's liquidity being out of range (e.g. position is fully one asset) and no longer earning fees.

How QuickSwap V3 makes money

Instead of the 0.3% trading fee that QuickSwap V2 charges, V3 offers dynamic fees that adjust based on volatility. The rates for V3 are variable and expected to average between 0.1%-0.15%. When traders swap between stables, the fee will be lower. but swaps between volatile assets will be higher to decrease the risk of impermanent loss for LPs. The new fee split is as folllows: 90% will go to LPs, 6.8% to the Dragon's Lair (QUICK stakers), 1.7% to the QuickSwap Foundation, and 1.5% to the V3 developers.

How the oracle is upgraded

V3 offers significant upgrades to the time-weighted average price (TWAP) oracles in V2. Oracles in V2 worked by storing cumulative sums of token pairs. This allowed the price sums to be checked only once at the beginning and once at the end of a period. V3 removes the need to track previous values as it stores an array of cumulative sums instead of just one. This make it possible to calculate TWAP within the past on a single chain call.