SwapX (SWPX): The future of liquidity provision on Sonic

In mid-February 2025, Argentina's President Javier Milei posted a tweet promoting a previously poorly known cryptocurrency, Solana (SOL)–based Libra (LIBRA), triggering a huge price surge from fractions of a cent to over $5 within hours of the tweet. The token's creators, who controlled 70% of the supply, quickly sold their holdings at the peak, causing the price to plummet to less than $1 within hours. Approximately five hours after his initial post, Milei deleted his post, distancing himself from the project as rug pull allegations spread.

The LIBRA token debacle further tarnished Solana's reputation, already undermined by the numerous dubious meme coins on Solana, exacerbating SOL's decline. US president Donald Trump's announcement about including SOL in the proposed US strategic crypto reserve assets list helped soften the decline, but the damage had already been done.

Against the backdrop of Solana’s reputational troubles, developers and decentralized app (DApp) operators are actively searching for alternatives — and many are turning to Sonic (S), the rebranded reincarnation of Fantom (FTM), as a chain that also features great performance and cost advantages, while also being Ethereum virtual machine (EVM)–compatible and, importantly, largely free from the image of a scam nest.

Among the many DApps embracing Sonic is SwapX (SWPX), a decentralized exchange (DEX) that offers a number of innovative features, including concentrated liquidity (CL) provision, modular plugins for additional functionality, automated liquidity management, user-friendly account abstraction and more.

Key Takeaways:

• SwapX is a Sonic-based DEX platform that offers a range of liquidity pools and products — standard AMM pools optimized either for volatile or stable assets, CL pools and CL pools with a mechanism for automatically managing price range allocations.

• SwapX's native crypto, SWPX, is used for governance and various types of reward payouts, such as farming yields for liquidity provision, weekly rewards and airdrops.

What is SwapX?

SwapX (SWPX) is a DEX platform built on the Sonic Layer 1 blockchain, which aims to provide efficient, user-friendly and flexible trading solutions for crypto token traders and liquidity providers. SwapX takes advantage of Sonic's speed and cost advantages to offer cheaper transactions and nearly immediate settlement, both of which are important considerations for DEX users.

The SwapX project has implemented several features and services to address the needs of token swappers and liquidity providers at all expertise levels.

SwapX's execution engine is powered by Algebra Integral, a decentralized finance (DeFi) technology provider offering a suite of automated market maker (AMM) solutions. The SwapX DEX has integrated Algebra Integral's V4 engine, a modular architecture that lets exchanges use customizable plugins for additional functionality. SwapX's plugins support modular upgrades and extend the platform's capabilities by adding new services without disrupting core operations.

Prioritizing liquidity and security

SwapX offers Uniswap (UNI) v3–style CL pools, which let liquidity providers contribute their funds within specific price ranges. The platform also features automated liquidity management (ALM), so users can add a single token to liquidity pools (instead of having to deposit a pair of tokens). It also removes the need for liquidity providers to actively monitor their positions.

SwapX prides itself on its robust operations, which ensures overall security by restricting plugins from handling user funds directly, thus minimizing the risk of potential vulnerabilities. The platform also uses thoroughly audited, verified smart contracts to maximize user protection.

Another innovative feature of SwapX is account abstraction (AA), which simplifies user authentication by allowing access via an email or Google account. Instead of relying solely on private keys, AA uses smart contracts to manage accounts, which further enhances security.

The SwapX project is unrelated to the earlier (and, by now, largely defunct) BSCEX AMM aggregator platform, which was sometimes referred to as BSCEX SwapX.

Why Sonic?

SwapX's choice of the Sonic blockchain isn’t incidental. The Layer 1 chain has been gaining popularity over the past few months, thanks to its stellar technical properties, low transaction costs and scam-free reputation.

Sonic, a rebranding of an earlier popular blockchain Fantom (FTM), launched its mainnet in December 2024. The Sonic chain boasts a throughput capacity of up to 10,000 TPS and sub-second finality times. Unlike Solana, Sonic is also EVM-compatible.

In February 2025, DeFi activity on Sonic began to rise, with some of the new activity supported by Solana's difficulties and the search for a less controversy-affected hosting platform.

Supported by the broader shift from Solana to Sonic, some Sonic-based DeFi protocols — such as Shadow (SHADOW), Metropolis (METRO) and SwapX itself — saw their token prices surge around mid-February. However, by early March, many of the tokens were off the highs to which they’d quickly climbed.

SwapX key features

YieldSync plugin

We noted above that plugins are one of SwapX's core features, allowing it to extend the basic AMM functionality. YieldSync is probably the most important of these plugins.

The plugin, created jointly by SwapX and Algebra Integral's developer, enhances liquidity pools containing yield-bearing assets like liquid staking tokens (LSTs) and liquid restaking tokens (LRTs). It redirects part of these tokens' yield into incentives that encourage voting within the platform's governance system. 

This process increases the overall rewards for liquidity providers and makes the pools more attractive, which draws in more liquidity and boosts the pools' efficiency.

Concentrated liquidity

CL, another key feature of SwapX, allows liquidity providers to contribute their funds within specific price ranges to optimize the use of their liquidity. First introduced by Uniswap v3, the CL model can deliver greater returns and lead to more efficient capital usage than the standard AMM setup, whereby the contributed liquidity is spread over the entire price range in the pool.

It should also be noted that while CL-based liquidity provision can be highly profitable, it requires active management and is more complex than the standard AMM model.

Liquidity pools

SwapX features four distinct liquidity pool types — Classic Volatile AMM, Classic Stable AMM, CLAMM and single-token pools offered in partnership with the ICHI liquidity strategies provider.

• Classic Volatile AMM is based on a constant product formula, adjusting the exchange rate based on supply and demand, which is suitable for volatile crypto assets. These pools have a 1% swap fee.

• Classic Stable AMM (sAMM) uses a constant sum formula to minimize slippage and price impact, making it best for stable or well-correlated asset pairs. The swap fee for these pools is just 0.01%.

• Concentrated Liquidity AMM (CLAMM) allows liquidity providers to set their preferred pool price ranges. Fees are dynamically adjusted based on market conditions. Depending upon their preferences, liquidity providers can also set a fixed fee.

• ICHI pools allow liquidity providers to deposit a single token paired with another token in order to generate yield using the ALM functionality covered below. The pool ensures that the deposited token maintains a 65%–95% weight in the pair. All liquidity in the ICHI vaults remains within the main liquidity pool, and follows the same swap fee rules as those for the other pools.

Automated liquidity management

Earlier on, we mentioned SwapX's ALM functionality, which is leveraged by the ICHI pools. In essence, SwapX's ALM helps liquidity providers in CL pools automate the process of adjusting liquidity within specific price ranges. This reduces the need for constant monitoring and manual adjustments, one of the core drawbacks of the standard CL model. ALM aims to maximize yields by keeping liquidity active within profitable price ranges. In other words, SwapX's ALM might be described as an "auto-pilot" mode for concentrated liquidity provision.

Source: swapxfi.gitbook.io

What is the SwapX crypto token (SWPX)?

SwapX’s native token, SWPX, is an ERC-20 asset issued on the Sonic chain. Its primary function is to facilitate governance voting on the platform. Holders of SWPX can lock their funds and be issued veSWPX, an NFT asset that grants the rights to participate in on-chain votes, and attain voting power alongside farming rewards. In addition, veSWPX qualifies you to receive weekly rewards from swap fees and voting incentives. Eligible users can also receive the token via airdrop distributions.

SWPX has a max supply of 123 million and a total supply of over 58 million, of which around 14.44 million are in circulation. The token's maximum supply limitation is 123 million. As of Mar 14, 2025, the token is trading at $0.30 and has a market cap of $4.44 million, according to data from CoinGecko.

Closing thoughts

SwapX is among the newer DeFi platforms taking advantage of the Sonic blockchain's recent popularity, technical efficiencies and low costs. With an array of options for traders at all levels of expertise, SwapX has solid potential to become a significant player, at least within the Sonic ecosystem. 

Whether you want basic token swaps and liquidity provision, or prefer to utilize more advanced strategies, such as CL-based liquidity provision and ALM, SwapX has something to offer you.

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