*obligatory not financial advice*
What is ZilSwap?
ZilSwap is the main decentralized exchange of the Zilliqa blockchain which is a smart contract chain that is highly scalable due to its sharding.
With ZilSwap you can trade tokens that are native to Zilliqa completely without depending on any centralized entity and with low gas fees. You can also provide your own tokens to earn trading fees as passive income. The exchange works like any standard DEX does, with liquidity pools for trading pairs where the prices are set automatically based on the supply of tokens.
There is a surprisingly high amount of tokens that are available on Zilliqa and recently there was a bridge to Ethereum added, which is why some Ethereum native tokens like ETH, WBTC and USDT are also available. The ZilBridge allows its users to move digital assets from the Ethereum main net so that they can take advantage of the lower fees on Zilliqa and projects from Zilliqa can also bring their tokens to Ethereum that holds more funds.
There is also a sort of Launchpad called ZILO were ZWAP holders are able to provide liquidity to new tokens before they even launch on the DEX. This makes it easier for new projects to launch and lets people that want to take a risk buy in especially early.
And there is an integrated NFT marketplace called ARKY that is distributing 15% of its platform fees to the holders of the ZWAP token and liquidity providers. There are many collections available there like ZilDucks or The Bear Market. Some of the available NFTs can be used within games or let you earn a share of the fees on the marketplace.
ZilSwap unites a DEX, marketplace, bridge and Launchpad in a single dApp. This makes it possible for the project to be the back bone of the DeFi world on Zilliqa. All parts of ZilSwap are also getting further improved. For example it will soon be possible to provide single-side liquidity and there will be burn mechanisms for the native token. If Zilliqa would gain more importance and users, then ZilSwap will grow with it.
The ZWAP Token
ZWAP is the governance token of the ZilSwap DEX. Holding the token gives you the right to vote on proposals to update the protocol and change some parameters. The token is also used as reward for liquidity providers and you can use it to earn 15% of all fees on the ARKY NFT marketplace. The token also makes it possible to invest in new projects on the ZILO Launchpad before they are even added to the DEX.
There is a total supply of only 1 million tokens. 5% of the supply were minted and distributed at the launch of the token, 15% of that went to the developers and 85% was airdropped to people that used the DEX to trade or provide liquidity before the token was created. Of the remaining supply, 15% is going to the developers and 85% are going to liquidity providers. How much a liquidity provider earns not only depends on how much they provide, but also on how long they supply it. The vast majority of ZWAP tokens are going to people that provide funds.
The value of the token depends on how much trading is happening on ZilSwap and on how much funds are in its smart contracts, and the demand and value of that depends on how well Zilliqa performs. Since the blockchain is already very scalable it could handle many useful dApps and ZilSwap could grow to be an essential part of that thanks to its DEX, Launchpad and Ethereum bridge. Most of the supply is also going to the actual users and only 15% goes to developers. However, there are many different smart contract chains that are using sharding for scaling and are more popular than Zilliqa, like Harmony ONE and Near Protocol.
The ZWAP token is not listed on most centralized exchanges but you can buy it directly on the ZilSwap DEX if you have some ZIL coins. You can use a ZilPay Wallet to store your tokens and to use the dApp.
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