Lattice’s competitive advantage mainly comes from the Hypergraph protocol of the Constellation network, which is designed to increase speed and charge zero transaction fees.
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By providing high-yield financial solutions for cryptocurrency holders and users, the total market value of the DeFi concept has soared to $15.5 billion in just a few months.
After AMM and liquidity mining have stimulated the growth of on-chain liquidity, DEX can finally handle larger-scale transaction needs. DEX aggregators that can integrate multiple decentralized trading platforms and tokens have gradually emerged and become another one. Decentralized financial applications that are highly sought after by the market.
At present, Ethereum-based on-chain transaction aggregation tools include 1inch, Matcha, ParaSwap, Totle Swap, Nuo, DEX. AG, etc. Judging from the data performance of the most recent year, among the three aggregate trading tools (1inch, ParaSwap and DEX.AG) that have been accessed by DeBank, 1inch is the main player on the aggregator track.
The value of transaction aggregation tools is that they can provide users with a convenient and simple service, collect and find the optimal transaction path from various liquidity providers in the market, and reduce users’ comprehensive transaction costs.
For transactions with a large amount of funds, aggregators are similar to the “transaction execution” tools in the traditional financial industry, through various algorithms provided by service providers and combined with the specific needs of users, saving users overall transaction costs. For small transaction needs, due to the gradual increase in transaction costs on the Ethereum chain, users need to consider the on-chain transaction costs of specific tools in addition to the optimal price when performing token exchanges ( Gas).
And this is where the opportunities for new players in the aggregator lie. Today’s 5-minute chain news series will introduce you to Lattice, the new dark horse of DeFi transaction aggregation tools.
What is Lattice?
Lattice is a high-performance DeFi liquidity protocol developed by Ethereum and Constellation’s Hypergraph Transfer Protocol (HGTP). It includes a decentralized financial (DeFi) solution for transaction aggregation and automated market making (AMM) modules.
From the current development of DeFi, transaction fees, cross-chain interoperability, network speed, data sorting and order matching algorithms, and available liquidity are all bottlenecks in this growing blockchain financial market. Many of these obstacles can be overcome by using multiple automated market-making algorithms and scalable alternative base layer protocols.
But we have also seen that many current DeFi solutions are auxiliary solutions based on non-scalable infrastructure such as Ethereum, which will cause inconveniences such as network congestion and high transaction fees. The development of the blockchain and cryptocurrency industries has opened up new ways to create trust-free lending while creating a whole new field overnight. By leveraging Constellation’s free decentralized security infrastructure, Lattice will become the first major application on top of the world’s most scalable protocol built by Constellation.
Lattice’s advantages
Take the 1inch.exchange transaction as an example. In a transaction from DAI to USDT, funds usually flow like this:
The user sends DAI to 1inch;
1inch sends DAI to the liquidity pool 1 of curve.fi;
Curve.fi liquidity pool 1 save DAI to iearn.finance;
iearn.finance withdraw USDT to Curve.fi liquidity pool 2;
Curve.fi liquidity pool 2 send USDT to 1inch;
1inch sends USDT to users.
During this period, the gas fee for multiple transactions makes the cost of aggregation extremely high. At the same time, in the event of a black swan event or extreme market conditions, due to the limitation of the scalability of the underlying network infrastructure Ethereum, a large number of assets face liquidation, and their asset value and transaction fees on the chain will face great fluctuations.
Lattice’s competitive advantage mainly comes from the Hypergraph protocol of the Constellation network, which is designed to increase speed and charge zero transaction fees. Another major advantage is cross-chain interoperability. The access and liquidity between ERC-20 and DAG will drive the large-scale adoption of the DAG ecosystem and open the DeFi ecosystem to a more versatile infrastructure.
From the current introduction, Lattice uses the Hypergraph protocol to achieve the following four major advantages:
- The liquidity pool based on AMM allows lenders to earn transaction fees from their farming;
- Intelligent routing algorithm, which can execute transactions on different platforms;
- Advanced platform for pluggable institutional order matching algorithms for specific assets (multiple AMMs);
- The governance token of Lattice (LTX)-gives holders certain rights to economic parameters such as transaction fees and inflation/deflation.
Constellation Network and Hypergraph Protocol
Constellation Network is an infinitely scalable decentralized network that uses dynamic partitioning to improve speed and network optimization. It is committed to processing big data while seamlessly integrating data management solutions for high computing requirements (such as algorithmic transactions).
Hypergraph is a new infrastructure protocol based on Directed Acyclic Graph (DAG). With its use of dynamic partitioning for effective data distribution on a decentralized distributed network, and the use of mathematical proofs and concurrent consensus features, Constellation can achieve data-centric methods between blockchains and applications. An interoperable ecosystem, paving the way for the verification and adaptation of trade solutions common in traditional securities strategies.
At present, Constellation has cooperated with organizations or companies including the US Air Force, Splunk, Space ISAC, MOBI, Chainlink and Quant to provide alternative secure communication protocols similar to TCP/IP, but its core is always tokenization and security .
How to achieve the leap between Lattice and Constellation
As can be seen from the current official introduction, Lattice will first be developed on the Ethereum network blockchain for transaction settlement. At this stage, Lattice will aggregate liquidity from various existing DEXs to create better pricing and less slippage for traders. In addition, users can provide liquidity to the exchange pool on the platform to earn transaction fees.
Subsequently, Lattice will use a cross-chain bridge to connect the ERC-20 ecosystem and the Hypergraph ecosystem to achieve smooth transactions on the chain. With Constellation’s HGTP as the base layer protocol, Lattice will support more complex trading algorithms to meet high computational demands such as real-time trading.
The cross-chain bridge will be used as a way for cross-chain transactions to connect HGTP to the Ethereum network. It provides integrated access from the existing distributed ledger technology to Constellation’s Hypergraph, which increases the value of horizontal scalability, speed, and verification of complex data structures, while reducing transaction costs and transaction data loss. Lattice will allow users to choose or build their own AMM to create liquidity pools based on asset types. This can be achieved by developing multiple exchange agreements based on smart contracts and aggregating the liquidity of different pools to ensure that users can access the popularity pool on the entire platform.
Lattice’s development path
Lattice’s future development path can be divided into three main stages. The progress is divided into liquidity integration, interoperability improvement, and the improvement of new chain solutions:
Phase 1: Fourth quarter of 2020
Liquidity integration: Improve liquidity and slippage from multiple sources in the DeFi ecosystem. The AMM algorithm for maximum optimization is used for order execution. Give incentives to liquidity providers.
Phase 2: First quarter of 2021
Interoperability: the interoperability between Constellation Network and Ethereum. Connected to the Hypergraph of Constellation through a bridge with Ethereum, it becomes an “off-chain” solution for trade settlement.
Phase 3: Fourth quarter of 2021
Powerful Oraclization: The constellation network Hypergraph will become Lattice’s new on-chain solution, thus avoiding the dependence on Ethereum . Fees are based on $DAG, and will provide faster transactions, fewer losses and more powerful solutions.
Lattice team introduction
Lattice’s current team includes members of Constellation Network and Inc, distributed system engineers and blockchain architects, as well as senior entrepreneurs such as NASA, PwC, European Central Bank, and Oracle. Its co-founder and CEO Ben Jorgensen is an American entrepreneur and investor with an academic background in anthropology, economics and political science, focusing on the exploration of emerging technologies. According to official information, the founding team of Lattice is mainly composed of the following:
LTX token distribution
LTX is the governance and functional token in the Lattice ecosystem, which can provide liquidity and collateral for all creator tokens in the Lattice ecosystem. Lattice minted a total of 100 million LTX tokens, and the protocol has a fixed token supply:
25% of the tokens will be sold through private placement and public sales. Private placement is divided into three rounds for raising. At present, all three rounds of private equity financing have been closed and a total of 2.5 million US dollars have been raised. Investors include: the world’s leading crypto asset market maker GSR, Global digital Asset, Alphabit Fund, Blockfyre, FBG Capital, Hronos Ventures, Crypto Bridge. Follow-up will target The community started a small-scale community round of financing.
45% of the tokens will be used for liquidity mining, and tokens will be generated every day and distributed to users participating in the platform;
15% of the tokens are provided to the team and advisors;
5% of tokens are used for marketing;
10% of the tokens are reserved and will be unlocked within 24 months.
summary
Lattice’s vision is to increase the convenience of user transactions and provide platform users with more effective and profitable products. The platform will further lay the foundation for a tokenized data economy based on the Hypergraph ecosystem. Lattice can be used as an advanced version of existing DeFi solutions by providing users with the best price and market-making profit. It supports intelligent routing of transactions, and can aggregate liquidity pools, integrating multiple automatic market maker (AMM) algorithms on Constellation’s scalable Hypergraph network.
Transactions using the Constellation Network will be cheaper, more accurate, and faster than DeFi solutions based on other blockchain infrastructures. This can not only occupy market share, but also effectively stimulate the overall market potential.
