About DODO Coin
DODO price today is $4.05 with a 24-hour trading volume of $66,585,432. DODO price is down -3.0% in the last 24 hours. It has a circulating supply of 110 Million DODO coins and a max supply of 1 Billion. Binance is the current most active market trading it.
What is DODO?
DODO is the governance token for DODO exchange. To participate in governance, users will have to convert DODO into vDODO at the fixed rate of 100 DODO = 1 vDODO. vDODO tokens will give holders dividends from trading fees and membership rewards. Redeeming vDODO tokens to DODO tokens will incur a variable exit fee. This is expected to encourage long-term membership.
Besides governance, DODO tokens will have three new utilities for holders:
Trading fee discounts
How to obtain DODO?
What is DODO?
What is a Proactive Market Maker (PMM)?
Developed by the DODO team, Proactive Market Maker (PMM) is an oracle-aided algorithm with an advanced pricing formula that provides contract-fillable liquidity. Traders get lower slippage with PMM than Automated Market Maker (AMM).
PMM leverages price oracles to retrieve accurate market prices of assets as input. It then aims to provide sufficient liquidity near the market price for every asset. The result is that liquidity decreases rapidly when far away from the market price. The following graphs compare the price curves of DODO (PMM) and Uniswap (AMM).
With everything else fixed, it is clear that the PMM curve is significantly flatter than the AMM curve near the market price, indicating higher fund utilization and lower slippage. Prices provided by PMM are more favorable than AMM.
To minimize counterparty risks for LPs, DODO dynamically adjusts market prices to encourage arbitrageurs to step in and stabilize LPs' portfolios.
Unlike in AMM, where Liquidity Providers (LPs) have to provide two assets, DODO allows liquidity providers to deposit a single asset, like Bancor. This provides greater convenience for Liquidity Providers and largely eliminates Impermanent Loss (IL).
In short, DODO’s PMM offers the following benefits as compared to AMM:
Single asset exposure
Minimal Impermanent Loss (IL)
What is Initial DODO Offering (IDO)?
When the project team seeds liquidity in an AMM-based exchange, they will have to provide quote assets like USD tokens or ETH to create the market pair. Launching a project in DODO meanwhile requires the team to provide the project’s token due to its ability to support single-sided liquidity. The team can also set a fixed price as the Initial Offering Price.
Asset issuance on DODO provides the following benefits:
The team can set an arbitrary price to sell the tokens with zero capital requirement.
Sufficient and contract-fillable liquidity
Flexible parameters (design the price curve by fine-tuning the parameters)
What is the Vending Machine?
The Vending Machine is a bonding curve creation tool that allows protocols to bootstrap liquidity for their token flexibly.
As mentioned above, projects can launch their token using IDO with a customized bonding curve without the need to seed quote assets. This is a huge boon for small projects that are capital constrained.
Other than that, algorithmic stablecoins projects can utilize the Vending Machine to design a bonding curve that supports more liquidity around the pegged price. This ensures greater stability of the price of the algorithmic stablecoins.
What is the Crowdpooling?
Crowdpooling is a more equitable way to raise capital than other methods that are susceptible to aping or front run.
Users will have to stake their capital in the pool for a predefined period. After the period ends, every participant will receive the tokens following the same Initial Offering Price.
If the team raises more capital than the cap, every user will receive the tokens proportional to their pool shares. The remaining funds will be refunded to the users. This ensures all participants have a chance to obtain the tokens at the same price.
What is the Private Pool?
The private pool is a more flexible version of Vending Machine with more parameters allowed to be tweaked. This feature is mainly created for Market Makers to optimize their operations.
How capital efficient is DODO?
The token terminal has come up with a measurement of capital efficiency by dividing the exchange volume against their Total Value Locked (TVL). We can see that DODO has the highest capital efficiency among the DEXes.
It should be noted that the higher the TVL, the more difficult it is to maintain high capital efficiency. And the more long-tailed assets the exchanges have, the lower the capital efficiency will be.
From the graph, we can see that DODO has a much lower TVL as compared to Uniswap. It is hard to tell whether DODO can sustain capital efficiency if they have a much bigger TVL. Plus, Uniswap is hosting many long-tailed assets that do not have great liquidity, so that will impair its capital efficiency.