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Describe using a visual document how Sushi's Trident works and compare, if possible, with other similar products in Defi.
Sushi Swap, as always, surprises the whole community with its ideas. This series also comes with a surprise that is very practical.
Trident is a production framework for building and deploying AMMs(Automated market makers (AMMs) allow digital assets to be traded without permission and automatically by using liquidity pools instead of a traditional market of buyers and sellers. On a traditional exchange platform, buyers and sellers offer up different prices for an asset.), but it is not just an AMM itself. While AMMs can be created using the Trident code, there isn’t a specific AMM at the center of Trident. Instead, there is a framework for creating any AMM anyone would ever need. The concept behind this framework is that hard-coded swap environments like those found in Uniswap, Curve, and Balancer all necessitate the same underlying methods, and can therefore, be consolidated into a single interface. By consolidating them into an interface, the development process can occur more rapidly at a community level. For all intents and purposes, this interface, which we are calling the IPool interface, is also a discovery in the nature of liquidity at the point of execution. There are only so many things you need to do with a pool design, so pool designs will invariably follow the same patterns.
The term “Next Generation AMM” is very justified to describe Trident, thanks to the power of Sushi’s token vault, BentoBox. The BentoBox can also be considered as an architectural platform that allows developers to build complex, capital-efficient applications on top of it, such as Trident, for example. To better illustrate, take the BentoBox Sushi Strategy for example. If you were to take your $SUSHI tokens from your wallet and deposit them into your BentoBox token vault, without doing anything else and without paying any gas fees other than the send fee from your wallet, you will start earning Sushi.com platform fees, accrued from staking $SUSHI in the SushiBar. Even if your assets are sitting in your BentoBox balance idly, you will automatically be earning yields from strategies that are applied to the vault. The Sushi Strategy is one of many strategies that can be applied at once to BentoBox. The potential given to users by this powerful vault and the limitless possibilities of strategy design was the reason for Trident to be built upon it and why we coin this new AMM as the most capital efficient in DeFi in existence.
As of now, many decentralized exchanges rely on the constant product pool formula as their infrastructure. Trident is intended to be, at minimum, a superset of all AMM pool designs, by adding multiple pool types to provide relief for many of the pain points experienced due to the siloed liquidity problem and to protect users from price impacts and other risks that are faced by cryptocurrency holders.
Due to the nature of DeFi, technology, ideas and possibilities go from ideation to implementation at lightning-fast speeds and to ensure that the Sushi protocol is prepared for unforeseen updates to the DeFi horizon, Trident allows for simple integration of added pool types. This integration is made possible by standardizing the pool interface which allows adding new pool designs as long as they conform to the interface; Told you that without this explanation you would barely notice it!
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Constant Product Pool
In this pool type, swaps function automatically, hence the term Automated Market Maker (AMM), thanks to the formula: x*y=k, also known as the, constant product formula. -
Hybrid Pool
Based on a stableswap curve, this allows for similar assets to be traded amongst one another in a single pool, with less interference from other market factors or obviously dissimilar tokens. -
Concentrated Liquidity Pool
For concentrated liquidity pools the ultimate benefit is that it will allow liquidity providers to more narrowly scope their liquidity provisioning to maximize share of revenue they receive from platform swap fees across Sushi.com. -
Weighted Pool
A constant product pool has 50/50 weights of Token X to Token Y. Weighted pools will allow an arbitrary weight of Token X to Token Y. The advantage of this pool type is that it shifts the price impacts by the token weights.
The Trident implementation will allow for the presentation of a storage proof to give two simultaneous snapshots of the cumulative price. To do this, the user using the TWAP price will present a merkle proof where the block root is less than 256 blocks behind the canonical head. On chain, the contracts will confirm the validity of the storage proof and value to allow an instant TWAP snapshot.The benefit of TWAP is that it’s a fully decentralized, trustless price oracle for all assets.
If I want to tell you the truth, Trident does not have a direct competitor in Defi and we can not consider it a competitor platform because Trident has unique features, but here I will introduce you to some of Defi platforms that have some of Trident features i will introduce you
As always, Sushi Swap has emerged more advanced than its competitors, and with its latest method, Trident, it has made its community bigger day by day, and has added to the popularity of this exchange. Trident has all the features of its competitors and in addition it has more possibilities. Trident identifies all the weaknesses of its competitors and strengthens them to make its community bigger