WOWswap launched a decentralized leveraged trading platform based on BSC

In this article, we will introduce a new competitor in the decentralized derivatives track: WOWswap is a community-operated protocol for leveraged trading on decentralized exchanges. Launched its mainnet application on Binance Chain BSC on April 12, 2021. At the same time, its token WOW set a record for the fastest token sale in history, and completed the public offering capped at $700,000 within 9 seconds. 46 days after the perfect ending, the WOWswap mainnet was also launched.

Traders can now open long positions on Binance Smart Chain for 28 tokens with up to 5x leverage. The WOWswap mechanism allows a single liquidity provider to provide liquidity to BNB and BUSD mining pools, and traders can use these funds for leveraged financing for their decentralized automatic market makers (such as Pancakeswap). In return, traders pay liquidity providers an hourly rate, enabling lenders of BNB and BUSD to earn passive income.

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Impact on traders

Not so long ago, leveraged trading was the exclusive domain of seasoned investment professionals. But the emergence of encryption technology is changing this situation, and all major cryptocurrency exchanges are now offering leveraged trading services to the masses. However, centralized exchanges control the rules for leveraged trading, deciding which assets are available for leveraged trading, capital lending rates, and liquidation procedures.

Now that DeFi is hot, leveraged transactions should also be decentralized, that is, the community needs to be able to create and operate a common liquidity pool and determine the process of leveraged transactions.

In WOWswap, all key protocol parameters, such as tokens approved for leveraged trading, liquidation deposits, insurance fees, liquidation rewards, lending rates, fees for traders and liquidity providers, are controlled by WOW tokens, the protocol Holders of governance tokens jointly decide.

In addition to the governance protocol, WOW tokens increase in value every time a trader closes a profitable leveraged position. In this case, a 5% profit fee will be charged, while 50% of the fee will be used to buy back WOW from the market and burn it, and the other half of the fee will go to the insurance fund. This will motivate WOW community members to actively share excellent trading experiences, because the more satisfied WOW traders are with their transactions, the higher the burning rate of WOW tokens will be.