Education Ecosystem Blog

Decentralized Exchanges (DEX) are simply trading platforms without a governing body or entity overseeing transactions. To function as a decentralized exchange, DEXs employ the use of a smart contract and liquidity pools to automatically execute contracts when conditions have been fully met. Additionally, DEXs refrain from collecting user-data or mandatory Know-Your-Customer (KYC). It’s important to note that although decentralized exchanges primarily aid the swapping/trade of various tokens, they sometimes also possess additional features. This article attempts a fair comparison of three DEXs, the popular Pancakeswap, Sushiswap, and the relatively new DODO.

Pancakeswap is one of the first decentralized exchanges built on the Binance Smart Chain specifically to swap/trade BEP-20 tokens. This exchange is mostly preferred by traders interested in yield farming or staking. Pancakeswap has a native token, CAKE, which serves as an incentive for the provision of liquidity on the platform.

Sushiswap, sometimes referred to as a ‘user-friendly version of Uniswap’, was launched in 2020 by an anonymous developer “Chef Nomi”. Sushiswap supports multiple chains other than Ethereum, like Binance Smart Chain (BSC) and Polygon. Sushiswap possesses its own native token, SUSHI allowing holders to participate in the governance of its platform. 

DODO, launched in August 2020, boasts of a truly unique market maker; the Proactive Market Maker. This innovative market maker considerably maximizes efficiency while reducing spillage during swaps. Although still in its early stages, it has received positive community reviews making it our third exchange on this list.

Below is a side-by-side table comparing each platform:

 Conclusion

The decision to select the perfect DEX for your swap is clearly a tough one, especially with new platforms becoming steadily innovative. One criterion to be watchful of is security, and a good knowledge of security can only be achieved through DYOR (Do Your Own Research).