YEREVAN (CoinChapter.com) — On Nov. 16, decentralized exchange (DEX) SushiSwap partnered with ZetaChain, an interoperability platform ZetaChain to test Bitcoin-native DeFi swaps.
Sushiswap Zetachain Partnership Aims To “Bring Bitcoin To Defi”
The SushiSwap ZetaChain partnership aims to enable Bitcoin swaps across 30 different blockchain networks without wrapping or bridging the assets through ZetaChain’s Ethereum Virtual Machine (EVM).
The integration will involve the incorporation of Sushi’s v2 and v3 automated market makers and its cross-chain swap feature, SushiXSwap.
Ankur Nandwani, a core contributor to ZetaChain, explained that this partnership could significantly expand Bitcoin’s presence in the DeFi sector by providing a more native approach to Bitcoin integration. This counters the notion that bridging BTC without wrapping on another chain is impractical.
Sushi’s head chef, Jared Grey, agreed and recognized this development as a “transformative milestone” for the DeFi industry, especially considering the potential of natively swapping Bitcoin.
The integration process is planned to occur in two phases.
Initially, Sushi will launch a decentralized exchange (DEX) on ZetaChain’s testnet to facilitate basic asset swaps and liquidity provision. This phase will also include beta testing and incentives for application testing.
Subsequently, Sushi will become one of ZetaChain’s launch partners with the deployment of its mainnet, expected to bring full functionality for Bitcoin interoperability.
While the SushiSwap ZetaChain partnership promises to optimize the use of Bitcoin in the DeFi space, will it help SushiSwap out of the ditch?
Will SushiSwap Increase Its 0.4% Market Share?
SushiSwap has suffered an avalanche drop in total value locked (TVL) since the crypto market downturn in late 2021 and reached $300 million on Nov. 17, an over 96% drop from its peak of $8 billion in two years.
Generally, TVL indicates the liquidity available on a DeFi platform, which is crucial for facilitating trades, loans, and other financial activities. Thus, a rising TVL suggests increasing user trust and interest in the platform, while a declining TVL can indicate the opposite.
Moreover, SushiSwap currently commands only 0.4% of the DeFi market and takes the 30th place among DEXs with a daily trading volume of under $18 million, according to CoinGecko. Despite the large number of coins available (356 coins throughout 498 pairs), the DEX has not been seen.
Moreover, SushiSwap’s native coin price dropped 15% on Nov. 17, 95% below its all-time high in November 2021.
Judging by the SUSHI price and some on-chain metrics, the SushiSwap ZetaChain partnership is unlikely to revive the decentralized exchange. However, the Bitcoin swaps could still facilitate the platform’s popularity.
