An increasing number of projects are adopting Layer 2 solutions to address Ethereum expansion challenges, and yesterday LuaSwap launched a new exchange mechanism based on TomoChain.
This change will allow the Uniswap-inspired exchange to make the exchange of tokens faster and more efficient than many competing ERC-20 automated market makers.
Although LuaSwap is still an Ethereum-based application, transactions related to transactions are now performed using the TomoChain blockchain instead of Ethereum.
TomoChain uses a block length of two seconds and has a transaction fee that is significantly lower than on the main Ethereum network. Thus, exchanges, which usually cost $ 10 or $ 20, can be done on Ethereum for a few cents on TomoChain.
The recently launched TomoBridge allows two assets to be transferred between Ethereum and the TomoChain blockchains by encapsulating tokens. The process uses the recent TomoChain update, which allows you to package and import any ERC-20 token into TomoChain as a TRC-21 token.
Currently, transaction fees on LuaSwap are often higher than gas fees on Uniswap due to lack of liquidity for tokens on the side of the TomoChain bridge. However, this issue is expected to be resolved when a sufficient number of liquidity providers create LuaSwap pools on TomoChain.
TomoChain is just one of a number of Tier 2 solutions, including Matic and Optimism, that address Ethereum’s scaling challenges.
On January 19, TomoChain announced a partnership with Ramp DeFi to provide unique trading opportunities through recent developments in blockchain interoperability.
In November 2020, Keen Chaturvedi, Head of Business Development at TomoChain, told Cointelegraph that he believes cryptocurrency traders are moving from centralized exchanges to decentralized exchanges, noting that “unreliable and anonymous access to DEX / DeFi.” “This is not possible through traditional exchanges.