REVU/ADA Concentrated Liquidity Pool now live on MuesliSwap

Thanks to continuous efforts from the Revuto team to further improve relationships with other Cardano projects, we are excited to announce the launch of the first REVU-ADA concentrated liquidity pool on MuesliSwap. In order to improve the trading experience on decentralized exchanges, we secured initial liquidity for the REVU-ADA pair on the first Cardano DEX as a part of our partnership with the MuesliSwap team.

Despite the fact that the REVU token already has sufficient liquidity with healthy daily trading volumes due to being listed on top-tier exchanges like Kucoin and Gate.io, enhancing the trading experience on decentralized exchanges will help strengthen Revuto’s position within the Cardano community and among DeFi enthusiasts. We are very grateful that the MuesliSwap team selected REVU to become one of the first tokens with a concentrated liquidity pool on their DEX after the recent introduction of this innovative approach for liquidity pooling with SHEN and DJED pools.

What are concentrated liquidity pools, and how do they work?

Providing liquidity on a first-generation AMM (Automated Market Maker) is similar to putting tokens into a bag with everyone else’s tokens and everyone splitting the fees according to the amount of liquidity they’ve added to the bag. As a result, those who deposit the most liquidity will also receive the highest fees. The CLMM (Concentrated Liquidity Market Maker) is a next-generation AMM initially introduced with the release of Uniswap v3. In concentrated liquidity pools, supplied liquidity is used much more efficiently because all liquidity is allocated between two predetermined price ranges. This new liquidity pooling mechanism gives liquidity providers and traders a number of advantages and benefits.

Compared to standard AMMs where the liquidity in the pools is spread across all possible price ranges from zero to infinity, liquidity providers can earn higher trading fees by consolidating their funds into the lower price range. At the same time, traders enjoy deeper liquidity and lower slippage. Since the pool’s liquidity is concentrated because it must act as it had much more liquidity in the pool, when the pool moves away from its center, the ratio of tokens in the pool will change, and a higher amount of the other token will be required to to maintain the concentrated pool invariant. Supplying liquidity needs to be asymmetrical and occasionally significantly higher in one token than the other depending on the token ratio in the pool and the price of the tokens.

When the trade volume and liquidity providing starts to build up, Revuto and the MuesliSwap team have agreed to enable yield farming to additionally increase rewards to liquidity providers for the REVU-ADA pair on the MuesliSwap exchange, which is the first and currently the only DEX with concentrated liquidity pools on Cardano.