TABLE OF CONTENTS
Section 1: Overview……………………………………………………….. 2
Section 2: Decentralized Exchanges (DEXes)……………………………. 3
Section 3: DEX Functionalities……………………………………………. 3
Section 4: Current DEX Limitations and Market Gaps………………….. 4
Section 5: xFarmer’s Solution…………………………………………….. 4
Section 5.1 xFarmer Mobile App Functionalities………………………... 5
Section 5.2 A Decentralized solution…………………………………….. 6
Section 5.3 xFarmer Yield Farming and Trade Farming………………... 6
Section 5.4 Order Matching for Zero Slippage………………………….. 7
Section 5.5 Net Asset Pool (NAP) Capital Reserve……………………… 7
Section 6: Token Economics ……………………………………………… 8
Section 7: XF token allocation.. ………………………………………….10
Section 8: xF token distribution and governance………………………..11
Section 1: Overview
Cryptocurrencies have erupted into a trillion-dollar industry sparking a wave of worldwide financial disruption. At the heart of this crypto and blockchain growth lies a remarkable history of innovation that dates back to the 1980s, which first started with advancements in cryptography. Since then, a series of events have shaped the crypto space and the first cryptocurrency, Bitcoin, became the most prominent. Despite its spectacular growth in the last 12 years, the financial services industry has had low propensity towards Bitcoin acknowledgement, primarily due to its inherent lack of stability and adoption. Mainstream large financial institutions are also apprehensive towards accepting Bitcoin loans because of its significant price volatility, making it a difficult asset to utilize when accurately planning certain investment strategies.
Things change quickly, however, in the crypto space and the birth of decentralized finance (DeFi) brought upon a new wave of crypto-based financial applications. DeFi, an explosive trend that was popularized in the mid 2020’s is currently a sphere that focuses on leveraging blockchain technology and creating decentralized versions of traditional financial products and applications. DeFi has generated a plethora of opportunities that integrates fairness and transparency to build a robust financial system that dismantles autocratic controls from a single entity. The transition point for financial applications actually started in 2017, with fintech projects that facilitated functionalities on top of traditional payments and money transfers. Currently, DeFi can be seen as an umbrella term for a variety of applications and projects in the blockchain space geared towards disrupting the traditional finance world and lowering the barriers of entry for all participants to enter and be involved.
DeFi has grown into a maturing ecosystem of working applications and protocols that deliver value to millions of users. Assets close to $80 billion USD are currently locked in DeFi ecosystems, making it one of the fastest-growing segments within the blockchain space.
DeFi consists of applications and peer-to-peer protocols developed on decentralized blockchain networks that allow users access to an extensive range of financials tools that allow for easy lending, borrowing, or trading of cryptocurrencies. A majority of DeFi applications today are built on the Ethereum network, but many alternative public blockchain networks are quickly emerging and deliver superior speeds, scalability, security, and lower costs.
Section 2: Decentralized Exchanges (DEXes)
Built upon these public blockchain networks are Decentralized Exchanges (DEXes). DEXes are peer-to-peer services that allow two different parties to conduct transactions directly without going through a centralized intermediary or custodian. They are one of the most crucial, essential functions necessary within the DeFi space and presently, also lock in the most amount of capital or Total Value Locked (TVL) compared to other DeFi protocols. DEXes allow users to exchange or swap tokens with other assets, and can do so, with the aid of secure and equitable technological utilities and applications. Traditional exchanges (centralized exchanges or CEXs) offer similar options, but the investments offered are subject to that of the managing exchange’s parameters and determined costs. These extra costs and lack of democratic controls on each transaction is one negative aspect of CEXs, but one in which DEXes address and nullify.
A key case can be seen with the largest automated token exchange by trading volume, Uniswap. Founded in 2018 by Hayden Adams, Uniswap, deployed on the Ethereum blockchain, was launched after receiving grants from multiple venture funds and support from the Ethereum Foundation. Uniswap automates transactions and swaps of cryptocurrencies through the employment of smart contracts and automated market makers (AMMs). Uniswap’s innovative and ingenious product can be seen as one of the most successful on the market.
Section 3. DEX Functionalities
By benchmarking Uniswap as well as other major DEXes currently available today as a criterion of what a successful DEX requires, we have identified and highlighted a few major shortcomings. Currently, major DEXes like Uniswap, lack a native decentralized wallet and require linkage to a third-party wallet application which can be a complicated process. For the front-end user, they also lack elaborate charts and trading indicators. On top of that, users are typically only rewarded and incentivized when they provide liquidity to the DEXes’ liquidity pools. These factors create a high barrier of entry to inexperienced users. Finally, a core issue with current DEXes across the board is that they lack a societally recognized unit of value with global credibility that can act as a standard for their crypto to be pegged to. Learning and adapting from the high caliber Bretton Woods system which changed how the world operated with currency and also strengthened the power position of the USD, xFarmer understands that a currency should have a store of value tied to it and backing the coin in order to help mitigate inflationary issues or collapse of value. The Bretton Woods system, however, was centralized and had scalability issues. xFarmer will addresses this.
Section 4: Current DEX Limitations and Market Gaps
· DEXes and cross-chain wallets are separated applications
· UX/UI of web-based DEXes are not user-friendly
· Creating LP Token Pairs are complicated
· DEXes lack trading analytics to support advanced trading and fast decision making
· Lack of functionalities such as displaying detailed charts, liquidity, order history, last trades, positions, APY, or other trading indicators
· Lack of information of trending trades, newly listed assets, liquidity rankings to help traders both novice or advanced find better financial opportunities
· Disparate DEXes on different chains or separated and isolated
We need a one-stop solution.
Section 5: xFarmer’s Solution
All-in-one xFarmer Mobile APP
xFarmer platform addresses the issues mentioned above by creating an “all-in-one” product that focuses on a seamless, easy-to-use, user experience, and a fee structure that incentives all users.
XFarmer Mobile APP enables users to interact with decentralized exchanges (DEX) directly from smartphones in a user-friendly and easy-to-use interface. Typically navigating through a DEX web app and linking a third-party wallet is a convoluted process. xFarmer integrates cross-chain wallets with a re-vamped user interface making it easy to both trade and provide liquidity. xFarmer creates a user experience similar to the top centralized exchange applications currently on the market.
xFarmer DEX protocol which can be seen as an upgraded version of Uniswap in terms of our token economics structure and enhanced user experience. Currently, even among experienced crypto traders and aficionados, very few users are fully adept at leveraging all the functionalities of a DEX. In order to bring more users into the DeFi world, and increase higher engagement, a substantial focus of xFarmer will be emphasized on user experience and asset security.
Our vision at xFarmer is to accelerate this transition of users into the DeFi ecosystem and create a user-oriented solution that makes it easy for everyone to join!
Section 5.1: xFarmer Mobile App Functionalities
Multi-Chain DEX
With 1-click, users can access additional DEXes on multiple chains that xFarmer has integrated.
Integrated Wallet and Assets
Decentralized crypto wallet and DEX are integrated in the xFarmer mobile app. Like other crypto wallets, you can add, trade, view, or engage with your favorite cryptocurrencies, LP tokens, or related pairs supported on various chains, all in one place.
Trade Support
There are more than 40,000 pairs and counting on the top DEXes and our APP provides charts for all existing pairs from time frames of 5 minutes to 1 week. MA indicators are available and every new pair will have its own charts automatically shown. Last trades, current positions, order history, and other indicators are displayed on the same page.
Swift Buy and Sell
To maximize efficiency, the SWAP transaction automatically signed and broadcasted to nodes and sent to smart contracts of target DEXes so no extra server is needed during SWAP action.
Enhanced User Interface
Traders are familiar with the UX/UI of centralized exchanges which are developed for efficient operations. We have created a similar familiar experience for user convenience
Pair Selection
Pairs are categorized by stablecoins and major cryptocurrencies making it easy to discover pairings. There is a Tx24h ranking which specifies SWAP transactions of a pair that’s completed in 24 hours so you can also search the contract address to find your pairs.
Add Liquidity
Add liquidity for pairs traded while viewing LP position displays, pair token redemption quantities, liquidity rank, APY commission, and SWAP transaction fees
Section 5.2: A Decentralized Approach
xFarmer DEX, like Uniswap, will leverage Automated Market Maker (AMM) mechanisms which rely on algorithmic formulas to price assets. Instead of depending on an order book like traditional exchanges, assets are priced in a decentralized fashion and are both self-regulating and permissionless. The market is formed by liquidity pools of cryptocurrencies versus the traditional counterparties of buyers versus sellers. On a traditional exchange platform, buyers and sellers offer up different prices for an asset. When other users find a listed price to be acceptable, they execute a trade and that price becomes the asset’s market price. Stocks, gold, real estate, and other commodities and assets rely on this traditional market structure for trading. AMMs change the inherent principle of this because of its more equitable nature creating a different approach to trading assets.
With xFarmer, anyone in possession of cryptocurrencies can become a liquidity provider by supplying tokens to the xFarmer DEX liquidity pool. Traditionally, a liquidity pool is a shared reservoir of tokens and users who supply liquidity can have the price determined by an algorithmic formula. xFarmer recognizes that this can be used as a competitive advantage to reward users because by adjusting this algorithmic formula, liquidity pools can be optimized for different purposes.
5.3 xFarmer Yield Farming and Trade Farming
xFarmer APP addresses the issues mentioned above by creating an “all-in-one” product that focuses on a seamless, easy-to-use, user experience, and a structure that incentives users in two ways:
Earning Method 1:
Our yield farming (aka liquidity mining) participants can obtain revenue by providing assets to our liquidity pools and increasing volume in our trading network.
An allocated 30% of the max supply of all XF tokens will be allocated to become earnings for liquidity providers. The specific allocation will be variable based on the various trading pairs offered.
Earning Method 2:
Our traders through the xFarmer application or our API portal can also “trade farm” or earn as they trade. All earnings will be shared in the form of XF tokens and approportionated based on transaction contributions.
An allocated 50% of the max supply of all XF tokens will be allocated to become earnings for users who trade.
The earnings percentage is dynamic and adapts to the ecosystem needs. In this way, we can compensate users to the maximum potential allotted for ecosystem equilibrium.
On current DEX protocols available today, Liquidity Providers (LPs) earn a fee when providing tokens to the pool. Normally, LPs can share a percentage of earnings, commonly ranging around 0.2% to 0.3%. xFarmer DEX, however, improves this model to boost gains for users in our ecosystem. We believe on a DEX, traders are crucial and based on this fact, we desire to reward traders more substantially. Traders as well as LPs, will both share revenue to promote ecosystem value on both sides of the equation. Liquidity providers are rewarded when they increase volume and traders who are active earn on trades.
Section 5.4: Order Matching for Zero Slippage
xFarmer DEX employs a proprietary order-matching process. When orders are initiated on the chain, it will automatically calculate the most optimal strategy to match orders with high efficiency and zero slippage. When orders are successfully matched in the liquidity pool, transaction fee income will enter the reward pool (will be discuss in the next topic) and rewarded to the liquidity provider. If the orders are successfully matched, transaction fee income will enter the “reserve pool” as a capital reserve to provide incentive to traders.
Section 5.5: The Net Asset Pool (NAP) Capital Reserve
xFarmer differs from other DEXes by creating a revenue sharing and asset protection system called the Net Asset Pool (NAP). In traditional finance, banks have a capital reserve that helps stabilize the value of the currency as also acts as an emergency fund that can used for contingencies. Traditional Banks may have capital reserves that range from 0%- 20% reserve ratio. Due to the volatile nature of cryptocurrencies, xFarmer will maintain a capital reserve of 90% of transaction revenue earned. That is our Net Asset Pool (NAP).
The capital inside the NAP can be redistributed back to traders and liquidity providers as rewards. It acts as a safe haven for our ecosystem users to trade XF token back into other cryptocurrencies (USDT, BTC, HT, HUSD, etc…) at any time. In the xFarmer ecosystem, traders, liquidity providers, and operators are all treated as shareholders.
When trading or providing liquidity, users will receive XF token as rewards. To ensure the sustainability of the system, the NAP allows these “XF shareholders” to burn XF to redeem assets from the NAP. This is different than other protocols in that we allow users to do this at any time. The NAP simultaneously acts as a capital reserve to protect users and the XF ecosystem.
The NAP is designed to store 90% of earnings revenue which means that 0.27% of trading volume will be automatically stored in the NAP.
Section 6. Token Economics
Proof of Trading Volume (PoT) Consensus Mechanism
XF Tokens relay on a Proof of Trading Volume (PoT), similar to the well-known Proof of Work (Pow) algorithm used with Bitcoin, to ensure that each subject participating in the transaction can obtain rewards from their trading volume contributions. XF tokens will be distributed to yield farming and trade farming users accordingly.
Within the PoT mechanism, xFarmer defines several new terms, Basic Reward (BR), Basic Reward Volume (BRV), Basic Reward Unit (BR Unit), and Reward Period (RP), to describe the volume-based reward generation and distribution strategies.
In Detail:
Basic Reward Unit (BRU), Basic Reward (BR), Basic Reward Volume (BRV), and Reward Period (RP)
A Basic Reward Unit (BRU) is comparable to a “block” in Bitcoin mining. Each BR Unit records and has confirmations for a number of the most recent xFarmer transactions that have not yet entered any prior “unit” (block). These confirmations are executed during a variable period of time determined by the given trading volume within this unit. This avoids the “double-spending” issue. This is also the basic of the PoT system.
Basic Reward (BR) is used to describe the amount of XF token mined in each Basic Reward Unit (BRU)
The Basic Reward Volume (BRV) is used to describe the trading volume required in each BR Unit. xFarmer creates an algorithmically determined formula that maximizes the highest potential for user rewards.
For Example:
Initially set BR = 500 XF and BRV = 40000 USDT
This means that when trading volume reaches 40000 USDT xFarmer will reward traders 500 XF tokens shared proportionally based on their trading volume.
Reward Period (RP) is designated to describe the time required to adjust the difficulty of the PoT system to next level.
xFarmer has integrated into its smart contact an algorithm to adjust the BRV quantity for each Reward Period based on the following formula:
For Example:
If n = 2, BRV of RP(1) is set at 40000 USDT and the first RP takes 1000 minutes, then BRV during second RP will be set at 57600 USDT
For liquidity providers, the total reward amount of all LP pairs is confirmed when last RP is completed. Each pair will split the total reward amount based on volume provided in that same period.
The BRV will also following these limits:
Regarding Block Halvening
Block halvening helps xFarmer maintain a healthy ecosystem with pricing and supply. In the xFarmer block halvening model, blocks will be halved based on the following calculation:
The difficulty of mining will be adjusted every 144 BRU. Every 100,000 BRU will result in one halvening. This will result in decreasing the rate in which new XF tokens will be released into circulation, and will continue with this logic until all XF tokens are released into circulation.
XF Value Anchoring
As mentioned above, the NAP acts as an anchored capital reserve through smart contracts to protect the xFarmer ecosystem. Under normal circumstances, XF token holders can use the NAP swap XF into other crypto assets (BTC, ETH, USDT, etc…) at any time. On our end, we will burn the redeemed XF to regulate inflation. NAP data will be updated every 24 hours and synchronized on the chain and website.
When users want to swap XF through the NAP, XF anchor price is automatically calculated by the following formula:
The XF Anchor Price core is based on transaction fee revenue. 90% of transaction fee revenue will go towards the NAP while the remaining 10% will be left for ecosystem operations.
If XF market price is less than anchor price, we assume XF token holders will interact with NAP to swap for the higher XF price, and simultaneously initiating the XF token Burn and Redemption will naturally adjust the XF token ecosystem to manage the XF market price based on natural supply and demand.
7. XF Token Allocation
8. XF Token Distribution and Governance
XF is the governance token of xFarmer, and grants users’ additional privileges in the xFarmer ecosystem.
80% of the XF token total supply is allocated to Community through Yield Farming and Trade farming and 20% of the XF total supply will be allocated to Early Investors, Advisors, Operators, and the ecosystem.
Tokens will be released based on the formulas illustrated above. This allows for XF to be released in a linear, healthy, manner a significant portion would be gradually released over the course of 100 years. This will help alleviate problems such as too many tokens released too quickly, or for 1 party to have an over-significant amount of tokens in possession. This keeps the xFarmer ecosystem to be as decentralized as possible.
If adjustments are to be made to foster ecosystem growth, all changes will go through a community vote and announced on our website announcements page.
Inspired by Ethereum’s vision, we have resolutely committed to the ideals of permissionless access, security, and immutability. These are the indispensable core foundations to establish components of a decentralized future where anyone in the world can access financial services without fear of discrimination or counterparty risk.
