Cosmos based DeFi - Part 1: Gravity Dex

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The Cosmos eco-system is about to undergo a rapid growth phase with a number of new DeFi platforms about to emerge. Up until recently, while many different chains have been built on a cosmos base, they have not had links enabling DeFi with native tokens. With the role out of the Inter Blockchain Communications (IBC) Protocol, that is about to change.

I aim to produce a series of posts over the coming days looking at all the different options that are currently being built, and the way these separate chains will become linked through IBC. I've been bad at producing post series in the past, starting but never finishing them, so hopefully I can get through all the major options with this one.

Gravity DEX.

gravity dex.png

Image Source: Gravity DEX website

Gravity uses the Inter-Blockchain Communication (IBC) protocol to enable swaps and pools of digital assets between any two blockchains within the Cosmos ecosystem or beyond. Gravity also achieves superior efficiency compared to other AMMs due to its groundbreaking Equivalent Swap Price Model.

Source of quote: Gravity DEX homepage

To me, it looks like Gravity Dex will become the Uniswap "equivalent" for Cosmos chains. It seems like it will be the major Dex, with support and dev from the Cosmos ATOM community. I'd expect it will attract fairly deep liquidity, with many cosmos based chains keen to have their token in pools with Atom and offering incentives to their communities to add to LP's. Many, like Akash, haven't got the big exchange listings, and access to a deep pool will significantly benefit these projects in becoming more accessible.

Like many of these upcoming Dex's I'll cover in the next few days, there is not a great deal of information out there. Gravity is discussed in the main Cosmos telegram group, which gives me the idea that it is the "semi-official" DEX for the cosmos. The website doesn't say very much, and the only links at the end are to Telegram and Discord, both of which are the main Cosmos channels, not a dedicated separate project page. The Dex will run on the Cosmos hub, so I would see it as the default Cosmos (ATOM) Dex.

The main way we will probably get an insight into what the Gravity Dex will look like, and how it will work, is through an upcoming trading contest they have launched. On the home page, there is a link to a form to register for this competition. To enter, you will need a Keplr wallet (a browser extension like Metamask) and fill in the form. The contest has around $200,000 in prized available, so it could be worth a look. Registration closes in a little over 24 hours from the time of this post. So if you are keen to see what Gravity will look like, and pit your trading skills against around 5,000 other people registered (4796 to be exact at the time of this post) don't delay on entering. The competition runs from the 4th to 11th of May.

I have signed up for the contest, not so much because I think I'll win anything, mostly just to see what Gravity will look like and how it will function. The Cosmos eco-system is highly underrated in my opinion, and IBC will, over time, add a huge amount of scale and growth to many projects in the Cosmos. Cosmos have a pegged asset setup, with a bridge built to Ethereum and a dedicated "peg zone". I'm unsure if ETH pegged assets will be in the Gravity Dex, but I would imaging it to be highly likely. The pegging system that Cosmos uses is a lot more decentralized than many peg or wrapped options out there, and with very low TX fees, Gravity could become a rapidly growing Dex if it gains traction beyond just the existing hard core ATOM community.

gravity dex competition.png

Image Source: Gravity DEX website

I'll make an update post once the competition is underway, and we get a good look at how Gravity Dex will work.

Are you closely following ATOM and the Cosmos community? Or keen on another project that could benefit from Gravity, and these new DeFi opportunities? Please feel free to provide any insights in the comments. I am not highly active in the Cosmos community, so hopefully there is someone out there that knows more than I do.

Edit: After originally creating this post, I came across this fantastic post on Reddit that added a lot to my knowledge on Gravity DEX.



Post shared on Reddit, and Twitter.

"Cosmos Based DeFi" series:

Part 1. Gravity Dex
Part 2. Osmosis
Part 3. Sifchain
Part 4. Thorchain

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