[ad_1]
The Mooniswap decentralized exchange protocol, developed by the DEX 1inch aggregator, will be the first Ethereum DeFi protocol to develop on NEAR, a fragmented smart contract platform.
As part of a collaboration announced on Tuesday, the 1-inch team has pledged to bring its automated market maker protocol to NEAR. Sergej Kunz, CEO of 1inch, told Cointelegraph that his Pathfinder aggregation algorithm will eventually be implemented as well.
The NEAR iteration of Mooniswap will remain independent of the existing version on Ethereum for the time being. While users will be able to use the NEAR Rainbow Bridge to bring Ethereum tokens to the new blockchain, the liquidity pools between the two platforms will be separated.
NEAR is a smart contract platform that claims much higher current scalability than Ethereum. Unlike other protocols like Polkadot (DOT) or Cosmos (Atom), there are no independent blockchains or parachains on NEAR. Instead, the protocol offers a single chain that is fragmented at the level of individual blocks. The goal of this construction is to simplify development by abstracting the underlying architecture into a familiar format. The NEAR protocol has a single environment shared by all decentralized applications, similar to the current Ethereum architecture.
Kunz said the existing scaling technology on NEAR will allow the team to “experience sharding and be prepared for the arrival of Ethereum 2.0”. The protocol is expected to be implemented on NEAR in 2021.
Mooniswap uses a unique delayed virtual pricing system to prevent front-running and help reduce temporary losses by reducing the profits collected by arbitrage traders. Under this system, changes to the actual price of an asset resulting from previous foreign exchange transactions are gradually applied over a period of five minutes.
Mooniswap is among the first major Ethereum DeFi protocols that have committed to building on another blockchain. NEAR had previously signed an agreement with the Balancer Protocol to establish funding for independent developers, although the DeFi app has not committed to building a new iteration of its protocol.
After scaling issues on the Ethereum main chain became apparent, the developers of the DeFi protocol began looking into both Ethereum’s native layer two solutions as well as other layer one protocols for solutions.
Although some protocols have had an advantage, the race has not officially started yet, as most of the scaling solutions will be released or completed in 2021.
