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Cast Magic Spells With CashTokens: Staking LPs On Cauldron DEX

By Pantera1 | The Future of Finance | 4 Dec 2023


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DeFi is LIVE on Bitcoin Cash with the 2023 CashTokens upgrade.

Cashtokens enabled on-chain UTXO-based smart contracts and the rise of Decentralized Finance on one of the most decentralized and technically advanced blockchains.

Today, we can harness the power of DeFi with low fees (less than $0.01) and instant transactions.

Cauldron DEX is the first DeFi DEX on Bitcoin Cash offering token swaps, LPs, and yield earning.

We explore in this story how to be a CashTokens Wizard and provide liquidity on the first CashTokens DEX, Cauldron.

Farm Yield On Cauldron DEX

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The Bitcoin Cash low fees (less than $0.01) allow absolutely everyone to take advantage of Defi and yield farming opportunities at this early stage.

Important to know that we earn a 0.3% yield from fees from each transaction on our pool, which is the incentive to provide liquidity on Cauldron DEX.

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The top tokens on Cauldron in terms of liquidity and volumes are FURU and DogeCash.

For this story, I use FURU tokens to provide liquidity on Cauldron.

*CashTokens Wallet:

Bitcoin Cash (BCH) wallets compatible with CashTokens:

  • Electron Cash (desktop)
  • Paytaca (mobile and Chrome extension)
  • Zapit (mobile and Chrome extension)
  • Cashonize (browser wallet)

These are the wallets we should be using with Cauldron at this stage, although we should also expect more wallets to apply CashTokens compatibility soon.

Step 1: Create a New Address on Cauldron

To provide LPs for FURU or another token on Cashtokens, we will have to get our hands on some tokens.

However, first of all, we have to create a new CashTokens address on Cauldron.

The browser wallet on Cauldron is non-custodial, giving us absolute control over the funds. The DEX provides the secret phrase(that we have to write down and securely store).

We also have to fund our Cauldron wallet with BCH to proceed with buying tokens and provide liquidity.

We can also transfer CashTokens (FTs) in this address to Swap or add liquidity.

Step 2: Swap BCH to FURU

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FURU tokens are airdropped to NFT holders of BCH Guru.

*Another CashTokens project, Dogecash also had two massive airdrops already, one to BCH Guru and another to Cash Ninja NFT holders.

FURU is also a utility and community-driven token with a use case to allow betting with no platform fees on the BCH Guru predictions platform (which will launch soon).

So, the first step is to purchase the amount of tokens we want to use in our LPs to farm yield.

*About The Current Liquitidy:

The liquidity on Cauldron is still not high enough to avoid price implications so any purchase using even 0.5BCH will vastly influence the price.

However, liquidity and volumes are slowly but steadily increasing so probably it is not wise to instantly dismiss DeFi on BCH for this reason.

In fact this early stage is probably the best time to get involved.

Step 3: Add Liquidity Position on Cauldron DEX

We proceed by adding a new liquidity position in the Pools section of Cauldron DEX.

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For this example I used FURU tokens which is the Cashtoken with the most liquidity in the market.

While adding new liquidity, we come across this page:

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At this stage, the platform recommends using the current price for the FURU token on the DEX. This is an important step.

If we change the price, we will offer LPs at a price that traders will quickly arbitrage to their advantage, so it might be best not to change the price but leave the market to decide and reach equilibrium.

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We have successfully added 150,000 FURU tokens and 0.4543 BCH to our pool, and our LP is now ready for trading.

As per Cauldron rules, we will receive 0.3% of trading fees for any trades conducted through our pool.

Moreover, we also have the option to withdraw the liquidity immediately if needed.

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In the Swap option, we discover that our liquidity has been added to the total, and our pool is now serving FURU/BCH swaps on Cauldron DEX.

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We can also view our pool on the pools data option and notice how we perform.

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My new pool already produced nine trades after just a few hours, and I will receive 0.3% fees for each of the trades performed in this pool.

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Note:

The current version of Cauldron is a pre-release, and when we land on the page we meet a warning message about the possibility of bugs and the risk of a loss of funds. It is worth taking notice and using the platform according to risk tolerance.

Nonetheless, it is also important to mention that the quality of the developers (Dagur, Halvor) is indisputable with several years of experience.

Conclusion

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The latest developments in Bitcoin Cash are truly groundbreaking. CashTokens brings together tokenization, DeFi, NFTs, and other smart contract-related applications, all on the Bitcoin Cash blockchain.

Developers and users can access these cutting-edge tools without having to worry about the high fees associated with other networks like BTC or Ethereum.

Cauldron DEX is committed to providing the best DeFi experience, and as a platform has the potential to drive massive volumes into the Bitcoin Cash ecosystem.

Probably the best time to begin exploring CashTokens.

 

 

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Cover Picture on Pixabay

My LinkTree@panterabch

Subscribe to my YouTube Channel: @panteraCrypto

Originally Published at: Medium

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