Crypto Academy / S4W8- Homework Post for @reminiscence01

Hello professor @reminiscence01,

I am very delighted to be part of this Season CryptoAcademy I must say over my stay in this academy I have learnt a lot which has greatly improved my knowledge in the world of cryptocurrencies and I hope I continue to get that knowledge from skilled professors like you. After reading the lecture notes you provided, I did my personal research to come up to with the solutions to your questions.

Q1 : In your own words, explain DeFi products and how it is shaping the present-day finance.

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Day in day out the crypto space is always developing and it’s no doubt that DeFi is developed. DeFi is a short acronym that stands for Decentralized finance these words would seem familiar to many users in this crypto academy. decentralization which is a system where users are free from middle men when executing a transactions. Whiles Finance has to do with money.

It is observed that the usual traditional system whenever transactions are made the user can not trade without the intervention of middle men this has lead to high transactions fees. The DeFi system aims to eliminate this by providing the user with financial services like lending, staking and borrowing without having to involve any middle man.

One can ask how is it possible?? The DeFi system uses smart contracts these smart contracts links the the borrower to the lender in a form of peer to peer trading with this the role of the third parties are eliminated.

DeFi products I would say are platforms or apps that provide financial services like staking, borrowing and lending to its users by eliminating third parties which will help reduce the high transactions fees in the traditional finance system. An example of a DeFi product is decentralized exchange.

Decentralized exchanges are platforms that help the user to exchange their assets for other assets or fiat without middle men or third parties interfering with the transactions. In decentralized exchanges the users are linked to others users who want to make a purchase of the asset this is termed as p2p trading (peer to peer )

How it is shaping the present-day finance.

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Let me give you a scenario from which we will know how DeFi is Shaping the current day finance I went to the back one faithful afternoon to withdraw some money and they told me I had to come back later so I went home and after 1hr I went back again and I was told the same thing. Now this is very common in today’s traditional finances they control our assets. The DeFi aims to change this by giving us total control of our assets meaning we can choose to sell our asset at any point in time without having to be told to go and come back later.

The next problem the DeFi products are shaping is the presence of third parties when transaction are made this is something which is very common in the traditional finance system. You will need to deal with the intermediate but not the seller or buyer directly but in the DeFi system you are connected directly with the buyer or the seller.

Let’s talk about the transparency in the present day finance, there is little to be said about it because when you execute a transaction only the sender and the receiver knows what is happening. The DeFi is so open that transaction are make open so that anyone can confirm and see every little detail of the transaction.

1b : Explain the benefits of DeFi products to crypto users

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DeFi products play a very essential role in the world of crypto currency’s to its users below are some importance of DeFi products.

1 - No ‘middle men’- DeFi products eliminates all third parties or middle when executing a transaction the user is directly connected to the buyer or seller.

2 - Transparency - Another importance the DeFi systems gives the user is transparency this means that all transactions carried out are not hidden form anyone unlike the traditional finance system where transactions details are hidden from users

3 - Less Transactions fees - The fees charged in the DeFi system are lesser than the financial system because no extra charges are charged for the middle men because DeFi systems have eliminated them.

4 - Security - The DeFi systems are more secured when you compare them to the traditional finance system because the system gives the user all the control of his wallet it can only be hacked when he misplaced his key.

5 - No need for verification - The DeFi systems will not trouble you with a lot of verification procedures like collecting sensitive personal information. To an extent that without these verifications you can’t perform a trade in the traditional finance system. This is not so in the DeFi system.

6 - Scalability - The DeFi system is more scalable than the traditional finance system when we say something is scalable it means the ability to carry out transactions within a short time.

Q2 : Discuss any DEX project built on the following network. Binance Smart Chain and Tron Blockchain

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I will be taking about the popular pancakeswap which is a decentralized exchange and runs of the Binance smart chain.

PancakeSwap

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Pancakeswap is a decentralized exchange platform which was lunched in September 2020. This platform uses its unique AMM. AMM is short acronym that stands for automated market marker. AMM stands in place for the order books and limit order books in the traditional finance system. The AMM matches orders together or in other words connects the users together.

This platform was developed to help users to be able to exchange tokens for other tokens (swapping). Let’s say I have cake I can decide to use this platform to exchange for let’s say BNB but mind you the cake you are exchanging for the BNB will be of equal value

this is a platform that is established on the binance smart chain hence uses BEP-20 tokens. pancakeswap allows grants the user with the privilege of staking youe tokens to earn rewards.

transaction fees in pancakeswap are very low one main reason you can think of is because there are no third parties. Pancakeswap can be used alongside with trust wallet, Binance smart chain wallet and also metamask.

Pancake price statistics

Source

Pancakeswap	Statistics
Pancakeswap price	$17.72
Price change 24hr	$-0.6354
24h Low / 24h High	$17.57 /$18.66
Volume / Market Cap	0.08027
Market Dominance	0.16%
Market Rank	#44

Source

Let me show you how to link your pancakeswap to the Metamask wallet screenshots will be provided to guide you.

Step 1 - I will be using my phone do demonstrate so the first thing you need to do is to download the Metamask wallet on your phone you can do so with this [LINK], after you have downloaded it follow the necessary procedures and register a wallet. Lunch the app and you should see something like this

Step 2 - Navigate and click on Browser type or paste this LINK and hit go or search.

Step 3 - When the pancakeswap platform lunches, click on connect

Step 4 - From the options that will appear next select Metamask wallet. And it should automatically connect.

Step 5 - Account connected.

Let’s explore the pancakeswap

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The first feature I want to talk about is the ‘Trade’ feature which is sub divided into two this feature helps the user to be able to exchange his assets to other assets
Let’s say I have BNB I can Exchange it to cake. Users can also provide liquidity courtesy of this feature.

The second feature is ‘Earn’ this is where the user gets to stake his LP tokens and earn a lot of options are provided for the user to look through and select the one that best suits him taking into consideration the APR.

‘Win’ is the next feature I will talk about this is an extra earring feature that will help the users to make more profit in a form of a lottery and prediction.

‘NFT’ this feature contains all the non fungible tokens and are ranked from highest to lowest.

Justswap

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Justswap is a project that was developed in the Tron Blockchain which happens to be decentralized in nature meaning no central authority controls its activities. As it’s name suggests Justswap allows users to swap or the token for the token (please note that the token must be ERC- 20).

So let’s say I want to swap Trx form sun I can simple use the Justswap platform to swap my Trx to sun. The swapping is done of the same quantity meaning if I swap 1 Trx I should get the equivalence.

The users can also add liquidity of two asset into the liquidity pool and start to earn rewards. Same as the pancakeswap it also uses the AMM which cancels the need for an order book in other to match orders together.

Let’s explore the Justswap

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‘Swap’ this feature like I said earlier on allows the users to exchange his assets for other assets like for instance I can swap my Trx for sun (equal proportion).

‘Pool’ this feature allows the users to add liquidity of two asset into the liquidity pool. The asset you are going to add must be in equal proportion or must be balanced. It is also advised to use stable coins to add liquidity.

How to connect the just swap to Tronlink wallet.

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Step 1 - You need to download the TronLink app you can do so with this LINK follow the necessary procedures and register an wallet.

Step 2 - Click on browser and from the list select Justswap and hit go

Step 3 - The wallet should automatically connect.

Q3 : In the DEX projects mentioned in question 2, give a detailed illustration of how to swap cryptocurrencies by swapping any crypto asset of your choice. Show proof of transaction from block explorer. (Screenshots needed)

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I will dive demonstrating using the TronLink app on how to swap an asset for another. Please follow closely

Step 1 - Launch your app and click on swap located just below your wallet address

Step 2 - Select the asset you want to swap to for me I will use the Trx to USDT.

Step 3 - Enter the amount you want to swap to and click on instant swap.

Step 4 - Click on confirm and enter your password

Step 5 - Swap successfully

Proof of transactions

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You can visit the Tronscan for details of this transaction Below are screenshots of the transaction.

Hash of the transaction

06559af3447bb3f1a2f85808768326c2e637efd822fe0be6cff7148ee814a2da

Conclusion

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My final words about the DeFi systems is that they are gradually shaping the current finance system by giving the users total control of their asset you don’t have to told when and how to spend your asset. And also the elimination of the third parties has greatly cut down the expenses paid to them.

Transparency is also something very key in this case nothing will be hidden from anyone all the transactions can be traced. Thank you for this wonderful and insightful lecture.

please note that all unsourced images are screenshots from Metamask wallet, TronLink and Tronscan respectively