FalconSwap
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FalconSwap

FalconSwap V1 Overview

With the upcoming release of FalconSwap protocol V1, we are excited to share our test net results. Our approach has shown significant reduction in gas fees to trade assets on Uniswap exchange and other decentralized liquidity protocols.

We are happy to report the successful completion of the first milestone to build a decentralized protocol to aggregate orders on Uniswap Protocol. This model also reduces slippage by executing orders before sending the aggregated orders to Uniswap. The slippage can be further reduced and optimized by using multiple liquidity pools from Kyber, Mooniswap, Balancer, etc.

So what’s FalconSwap? How did we optimize and reduced the gas fees issue? Why is this development so important?

FalconSwap Protocol in a nutshell

FalconSwap is a layer-2 scaling solution built on Uniswap and further extendable to aggregate other DeFi platforms like Mooniswap, Kyber, Balancer, Airswap, Bancor, etc. FalconSwap is solving the gas and slippage issue by aggregating orders before sending them to underlying liquidity pools.

Here’s an example of how this is working

Without FalconSwap

Let us assume that there are 3 buyers buying 2 ETH, 3 ETH and 5 ETH worth of tokens respectively and 3 sellers selling 6 ETH, 6 ETH and 8 ETH worth of orders respectively.

Using the current trading approach on Uniswap, every user will pay for their own gas fees and the total gas fees spent will be 6x the gas fees per order.

Moreover, each user will experience slippage based on the order of their transaction. These traders will end up paying even higher transaction fees if their orders are distributed among multiple liquidity pools.

With FalconSwap

When the above mentioned trades are placed on FalconSwap and are executed using FalconSwap - the cost savings are apparent.

FalconSwap will aggregate all 6 orders and 10 ETH worth of buy orders will be matched with 10 ETH worth of sell orders. The remaining 10 ETH worth of sell orders will be sent to the Uniswap or distributed among different liquidity pools to get an optimised slippage.

The ETH gas fees spent to execute these 6 orders will not be 6x the gas fees per order but a much lower value.

The orders executed on FalconSwap will experience no slippage and the remaining sell order will be sent to Uniswap or multiple liquidity pools. Overall the slippage will be optimized for all orders with a minimum gas fees per user.

It is also noteworthy that besides the gas fees and slippage optimizations, there are also trading fees saved for 20 ETH worth of orders executed on FalconSwap (10 ETH buy orders,10 ETH sell orders). 10% of the trading fees generated on the FalconSwap protocol will be used to buy FSW tokens from the market and burned. A part of the fees will also be used to buy FSW tokens and distributed to staking holders.

FSW staking holders will also receive additional fee discounts to trade on FalconSwap protocol.

FalconSwap Testnet results

In order to demonstrate the effectiveness of the above mentioned methodology, we started working on building FalconSwap Protocol. Once the core functions of the protocol were developed, we put them to test.

Below are the results of the orders executed on Ropsten testnet using FalconSwap protocol. We performed testing and order execution to draw verifiable results of our approach and gas savings achieved by FalconSwap protocol.

Test Case 1

Single order execution directly on Uniswap Protocol

Txn — https://teth.bitaps.com/0xff71f2c3310b73a2251408617e335d38272cb797184e4c24dca1b63c3ea248c2

Total gas used — 127,883
Gas used per order — 127,883

Test Case 2

2 orders matched on FalconSwap protocol

Txn — https://teth.bitaps.com/0x94cac4675eb46a9c9d1f788a71d0cd9cf95b6578780b13116942375ba1c8c079

Total gas used — 90,907
Gas used per order — 45,454

Test Case 3

2 orders matched on FalconSwap protocol with remaining liquidity tapped from Uniswap

Scenario 1 — Zero Storage Variables

https://teth.bitaps.com/0x37f517aab814ff8e3037de079d80eca88f9eb6aa484004ed1b9796545c36a4a0

Total gas used — 228,121
Gas used per order — 114,060

Scenario 2 — Non Zero Storage Variables

https://teth.bitaps.com/0x5534d3f23974d55b4aa68bf891f17a39d9986828ceebf3bbde31aae58b2f24bf

Total gas used — 183,121
Gas used per order — 91,560

Test Case 4

10 orders matched on FalconSwap protocol

https://teth.bitaps.com/0x534d970894b0a6ededaf34685d2fece1882655d78363996d9e5745cdb329579c

Total gas used — 264,014
Gas used per order — 26,401

Test case — 5

10 orders matched on FalconSwap protocol with remaining liquidity tapped from Uniswap

Scenario 1 — Zero Storage Variables

https://teth.bitaps.com/0x594fba0648f8833372d80f09fcf5426c8ddf7bdd41f0415848fe6a9c2b0a67c1

Total gas used — 521,567
Gas used per order — 52,156

Scenario 2 — Non Zero Storage Variables

https://teth.bitaps.com/0x9faf991abde3b63491d7c59733c8481fb54451b3946588f2a85cb202dcfb3b03

Total gas used — 356,567
Gas used per order — 35,656

Result Analysis

The test result clearly demonstrates the gas savings per user per transaction starting from when 2 orders are matched on FalconSwap protocol. When the orders are completely executed on FalconSwap, the gas savings are significant with approximately 64% gas saved per transaction. Even looking at the highly conservative number with zero storage variables and residual order sent to Uniswap liquidity pool (which users may opt not to), the savings on transaction fees per order is over 10%.

As the number of orders increase, the transaction fees for every order executed directly on Uniswap remains unchanged. However, the savings on FalconSwap grows with each transaction. In case of 10 transactions, the gas fees to execute each transaction will be as low as 26,401 and as high as 52,156, which is significantly lower than 127,883.

What does this development means

The above test cases and results clearly demonstrate the efficiency of the FalconSwap protocol. The growth of the DeFi applications and decentralized trading has choked the Ethereum blockchain to an extent that it is becoming unviable for transactions. With no real alternative available on horizon on Ethereum blockchain, FalconSwap protocol’s significance will grow with the growth and adoption of the DeFi ecosystem.

Know More

Website: https://falconswap.com
Telegram: https://t.me/Falcon_Swap
Medium: https://medium.com/falconswap
Twitter: https://twitter.com/Falcon_Swap

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