The underlying logic of QKSwap (decentralized exchange) is based on existing technical documentation and the general architecture of decentralized exchanges (DEX), with its core being a set of automated liquidity protocols built on the Quark Blockchain.
Its underlying logic can be summarized as: "Smart contract automatic matching + liquidity pool pricing + cross-chain asset interaction". It aims to solve the problems of decentralized asset exchange, liquidity, and cross-chain interoperability.
Here is a detailed breakdown of the underlying logic of QKSwap:
1. Core Mechanism: Automated Market Maker (AMM) and Liquidity Pool#
Unlike the traditional order book model, QKSwap adopts the AMM model currently used by mainstream DEXs (such as Uniswap).
Liquidity Pool:
Logic: Trading pairs no longer rely on buy and sell orders but are composed of a fund pool created by liquidity providers (LP) depositing two types of assets (e.g., QKI/USDT pool).
Constant Product Formula: The price of assets in the pool is automatically adjusted by an algorithm, usually following the rule of x times y = k (where x and y are the quantities of the two tokens in the pool, and k is a constant).
Function: When a user exchanges token A for token B, A is added to the pool, and B is taken out. As the ratio in the pool changes, the price fluctuates automatically (the more you buy, the higher the price).
Impermanent Loss and Earnings:
Liquidity providers earn trading fees (usually 0.3%) by providing assets but must bear the risk of "impermanent loss" due to drastic market price fluctuations.
2. Infrastructure: Empowerment of Quark Blockchain#
The underlying operating environment of QKSwap relies on the underlying technology of the Quark Blockchain, which addresses the common performance bottlenecks of traditional DEXs.
High Throughput (TPS):
Logic: The sharding technology and dual-layer chain architecture (root chain + shard chain) of the Quark Blockchain are used to support QKSwap.
Advantages: Compared to single-chain networks like Ethereum, Quark Chain can handle a higher transaction concurrency (TPS), allowing for faster confirmation of Swap transactions without delays or skyrocketing Gas fees due to network congestion.
Low Transaction Costs:
The efficiency of the underlying architecture directly reduces user interaction costs, making small and frequent Swap operations economically feasible.
3. Cross-Chain Logic: Asset Bridging#
An important underlying logic of QKSwap is to support interoperability of multi-chain assets.
Wrapped Tokens:
Logic: To enable assets like Bitcoin (BTC) or Ethereum (ETH) to be traded on the Quark Chain, the system locks the native assets through a cross-chain bridge and issues equivalent "wrapped tokens" (e.g., wBTC, wETH) on the Quark Chain.
Exchange: Users actually trade these cross-chain assets in QKSwap, achieving seamless exchange of assets across different blockchains.
4. Security and Incentives: Tokenomics#
Transaction Fee Distribution:
The majority of the transaction fees (Fee) paid by users are distributed to stakers in the liquidity pool, while a small portion may be used for the protocol's own buyback or burn mechanism, forming an economic closed loop.
Governance Tokens (if any):
Some Swap protocols issue governance tokens (e.g., QT), allowing holders to participate in voting on parameter modifications and future development directions through staking.
Summary: QKSwap Operation Process#
To help you better understand how a Swap operation occurs, I have organized the following table:
Step | Participant | Core Action | Underlying Logic
- Trigger | User | Initiate Transaction | User wallet (e.g., QKWallet) signs the transaction, specifying input tokens and target output tokens.
- Routing | Protocol Contract | Optimal Path Calculation | Smart contract calculates the optimal exchange path (direct exchange or via intermediate tokens).
- Matching | Liquidity Pool | Asset Swap | According to the constant product formula (x times y = k), the user's tokens to be sold are deducted from the pool, and the tokens to be bought are calculated and issued.
- Confirmation | Quark Network | On-chain Confirmation | The transaction is packed into a block on the Quark Chain, quickly confirmed using sharding technology, and updates the pool balance.
- Settlement | Smart Contract | Fee Distribution | The transaction fees generated are automatically retained in the liquidity pool and rewarded to LP providers.
One-sentence Summary:
The underlying logic of QKSwap utilizes the high-performance sharding architecture of the Quark Blockchain as its foundational support, achieving automated liquidity pool (AMM) asset exchanges through smart contracts, and combining cross-chain bridge technology to connect multi-chain assets, providing users with a highly efficient, low-cost, trustless intermediary-free decentralized trading experience.
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