May 18, 2022

Swarm Markets launches on Polygon, lowering cost barriers

Berlin-based and BaFin-regulated Swarm Markets GmbH, the first regulated decentralized financial infrastructure provider, announces its automated market maker (AMM) protocol is now available on Polygon Network. This is the first regulated decentralized exchange (DEX) available on the layer 2 solution, making it one of the cheapest and safest options for people wanting to access DeFi with investor protections.

The Polygon implementation comes 6 months after Swarm Markets’ AMM launched on Ethereum. So far, it has nearly 2,000 people in its liquidity provider program who have signalled their intention to pledge an aggregate of $100 million in assets onto the platform.

Trading volume on DEXs has been on the rise since DeFi summer in 2020. In 2021, trading volume on DEXs surpassed $1 trillion, according to a report by The Block Research. However, most AMMs are built on Ethereum, which often has high gas prices, making it expensive for many traders to transact on. 

Phlipp Pieper, co-founder of Swarm Markets, said: “Access to DeFi needs to be at a price point that isn’t cost prohibitive, which is why making our regulated AMM available on Polygon is crucial. Web 3 is coming for financial markets. At Swarm Markets, we’re building trustless infrastructure so that people retain control of their assets at all times and have the control and autonomy to make their own trading decisions in order to build wealth.” 

Polygon acts as a low-cost and speedy transaction processing layer, while relying on the time-tested Ethereum mainnet for settlement. The Polygon solution will enable greater scalability for Swarm Markets’ licensed protocol, offering lower gas fees and faster transactions.

“DeFi promises to drive innovation that simply isn’t possible in traditional finance, bring services to the unbanked and give regular people access to wealth management tools currently only available to elite institutions,” said Sandeep Naiwal, Polygon’s co-founder. He added, “As part of that mission, we are very excited to support Swarm Markets in their scaling efforts.”

Alongside the Polygon implementation, Swarm Markets has added a series of features to make decentralized trading more accessible. Users can create their own pools, and use features like smart order routing, which uses on-chain logic and SmartSwap, which uses off-chain logic to fulfill swap orders from the most cost effective liquidity pools on the Swarm Markets network, optimizing trading.

Timo Lehes, co-founder of Swarm Markets, said: “We’re creating infrastructure, products and services that preserves the innovation of DeFi and combines it with the reassurance of regulation. Our network of qualified traders can build their own pools and put idle collateral to good use. As financial markets become digitized, we’ll see them be reimagined along consumer lines.”

Swarm Markets’ unique status as a licensed entity makes it a pioneer in the Decentralized Finance (DeFi) industry. Operating under the purview of the German Federal Financial Supervisory Authority, BaFin, Swarm Markets adheres to the same consumer protection standards as other German financial service providers.

Pieper added, ‘We’re skating to where the puck is headed by having regulatory licenses from the outset. We expect this year that a lot of talk from regulators will turn into action and the industry will need to respond accordingly. We have translated existing securities laws into code in order to build a compliant DEX that removes counterparty risk and offers the same consumer protections as a German bank.”

Notes to editors

  • Swarm Markets operates under regulatory license from the Federal Financial Supervisory Authority (BaFin) in Germany, provided to Swarm Capital GmbH Branch Office Berlin, and is supported by Swarm Markets GmbH (together “Swarm Markets”).

About Swarm Markets

Berlin-based Swarm Markets is the world’s first regulated DeFi platform, providing a high liquidity protocol to financial institutions and retail traders. For the first time, financial products like stocks can be digitized and traded alongside crypto on one unified platform, connecting TradFi with DeFi. Its co-founders have been engaged in crypto since 2016 and initiated the non-profit DAO Swarm Network. Crypto traders can transact with verified counterparties, earn rewards by providing liquidity and find liquidity for trading tokenized assets in one regulated environment. For more information, visit the website and Medium page.

Media contact

Katie Evans, Global Head of PR and Communications

[email protected] 

+44 7903 073 570