- Uniswap recently became a top-ranking DeFi project thanks to the efforts of its upcoming rival.
- The rival in question is SushiSwap, a project that focuses on liquidity mining.
- Due to the way it operates and the methods it uses, SushiSwap was nicknamed ‘vampire protocol.’
DeFi project Uniswap recently overcame several top-ranking projects, including MakerDao itself. With a new TVL (total value locked) of $1.65 billion, Uniswap now ranks as the largest DeFi, with a 25.16% increase in the last 24 hours. Meanwhile, MakerDao currently sits as the second-largest, with $1.62 billion and 4.57% growth on the last day.
How did this happen?
According to recent reports, the change took place at around 21:00 UTC. Those familiar with the situation have revealed that Uniswap’s TVL skyrocketed thanks to the efforts of the project’s major rival, SushiSwap.
The project, which is one of the newest members of the Weird DeFi cohort, offers rewards in perpetuity to those who hold its SUSHI token.
The new development comes as a part of the recent campaign. For around two weeks before launch, users who opted to stake liquidity provider (LP) coins from Uniswap to SushiSwap will have received 10x the mining rewards early on.
Users were promised 1,000 SUSHI tokens per block prior to launch, and 100 SUSHI tokens per block following the launch. For the moment, the project is offering rewards for LP tokens on Ethereum pools, matched with a number of other cryptos, such as DAI, YFI, LINK, USDC, USDT, and others. Additional pools will be added later on, based on the users’ votes.
This is known as liquidity mining, which is basically when users store their assets somewhere and get new tokens in return for doing so. So, the project offered users to dump assets into Uniswap, and in doing so, gain a sizable amount of LP tokens.
LP tokens can then get dumped into Sushi, and take advantage of the offer by mining 1,000 coins per block. Then, after the offer expires, SushiSwap would be able to redeem Uniswap LP tokens and move them to its own pools.
This plan of action has led some in the industry to name the project a ‘vampire protocol,’ and the process ‘vampire mining.’