What is Serum (SRM)?

What is Serum (SRM)?

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Serum is a popular decentralized exchange (DEX) trading platform as well as an ecosystem that delivers decentralized finance exceptional speed and cheap transaction fees (DeFi). (DeFi).

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Serum is the first decentralized exchange built on an on-chain central limit order book and matching engine. Ecosystem partners may utilize Serum's on-chain order book to pool liquidity and fuel their institutional and retail trading features.

Users and developers are constrained by high gas prices and sluggish transactions because of the popularity of DeFi and the expansion of DEXes on Ethereum. Serum tries to address these typical DeFi concerns, as well as those of centralization, inefficient capital allocation, and liquidity segmentation.

Users of the SRM utility and governance token enjoy savings on protocol costs and voting rights; 100% of exchange fees are returned to SRM via buy-and-burn, staking incentives, and ecosystem awards.

 

Component Serum (SRM)
Technologies SHA 256, DApps, Smart Contracts, Cross-chain trading, PoS, On-chain order books
Market Capitalization 407.1 Billion+
Open-Source Yes
Consensus Mechanism SHA 256
Smart Contracts Yes
Founders/Authors A consortium of FTX, Alameda Research, and the Solana Foundation
Launch Date 2020
Circulating Supply of Coins 133,231,781 SRM
Maximum Coin Supply 10,161,000,000 SRM
Mining-based Coin? No
Is Serum a Stablecoin? No
Does Serum have a burn rate? Yes
Does Serum have a Whitepaper? Yes, more information can be viewed here

 

Evolution and Development of Serum

In August 2020, the Serum Foundation was established. It is the creation of Sam Bankman-Fried, an MIT graduate with degrees in mathematics and computer science.

Bankman-Fried is also the creator of Alameda Research (2017), a profitable cryptocurrency trading firm, and FTX, a prominent cryptocurrency derivatives exchange (2019).

Bankman-Fried, in collaboration with his FTX colleagues, devised a DeFi protocol for implementation that included an autonomous DEX.

Numerous centralized exchanges support serum. Additionally, it has formed various agreements, including one with Chainlink (LINK), which acts as an oracle for its DEX's price inside the ecosystem.

Among the project's major advisers are Robert Leshner, creator of Compound Labs, and Long Vuong, founder and CEO of TomoChain.

 

What makes Serum unique?

Serum is a decentralized Solana ecosystem. Its key feature is interoperability, and its ecosystem is decentralized. Serum provides an easy-to-use platform for exchanging crypto tokens without going through KYC.

Derived on blockchain technology, Serum's DEX eliminates the requirement for a traditional swap system, enabling users to add whatever trade pairings they choose.

Built on Solana's blockchain, Serum's DEX has all the features of a centralized exchange while giving users complete control over their cash.

Users can easily trade BTC, ETH, ERC20 tokens, and SPL tokens (Solana's token standard) using cross-chain functionality. These characteristics make Serum a fully decentralized platform with all the ease of centralized platforms.

Serum's USP is that it lets users construct their own DEXs. This implies that programmers may use Serum to establish a decentralized market.

Difficulties obtaining cash for consumers are commonplace. The solution is to develop a DEX utilizing the Serum ecosystem. Each Serum-based DEX's liquidity is shared with the others, and even the Serum DEX's.

The serum also rewards those who offer market liquidity. It is also worth mentioning that Bonafide and Aldrin are two popular DEXs made on Serum. In addition, Serum is based on the Solana blockchain, which means that the innovative ecology of Solana is inextricably linked to the Serum project.

Since Solana is the first true DEX, Serum has several advantages over other DEXs, including decentralization, on-chain order book, speed, efficiency, and cheap exchange costs. SRM crypto is an SPL token (Solana Program Library). This is a standard like ERC20 on Ethereum that allows Solana to create interchangeable tokens.

Serum uses the Solana blockchain's full potential to guarantee its ecosystem runs properly. Notably, Solana depends on blockchain interoperability as well.

This network works with Ethereum and even Bitcoin. This feature benefits Serum, which allows otherwise incompatible cryptocurrencies to collaborate. This makes them exchangeable on Serum's decentralized network.

 

What are the main uses for Serum?

SRM is the Serum native token. This protocol enables users to trade assets across blockchains with confidence. An automated full-limit order book allows investors complete control over their orders. The Ethereum and Solana integration makes Serum more efficient and compatible with ERC20 coins.

In DeFi, the regulated cross-chain contracts enable easy margin positions. SRMBTC creates ERC20 or Solana-based BTC tokens, whereas SRMUSD creates a decentralized USD fixed constant currency.

Stake incentives are allocated depending on node performance, which includes supplying blockchain histories for cross-chain placement verification.

The SRM token also has a traditional method, as do trade tokens. This redemption and destruction mechanism rarefies the overall SRM.

Aside from the SRM token's ecosystem usefulness, all SRM fees are automatically incinerated every week. This method decreases the supply of SRM tokens, increasing their rarity, which is why SRM is still useful.

Currently, Serum is the most popular decentralized exchange on Solana. The Solana ecosystem provides a quick trading experience, and the number of projects on Serum DEX will grow.

 

What is the future potential for Serum?

Project Serum's plan looks to be in five sections. The first and second part of the roadmap has already been achieved. Part one involved the Serum token and Serum DEX going live.

In addition, the project also constructed a cross-chain bridge that allowed third-party DEX creation on Solana and offered ecosystem funding for potential Serum applications.

Only the third portion of the overall roadmap is currently visible. It aims to incorporate decentralized lending as well as several borrowing services, yield farming, and even AMM smart contracts.

Project Serum has not set a timeframe for the completion of the third segment. The whitepaper and marketing video for Serum mention two distinct coins, SerumBTC (FBTC) and SerumUSD (USDT) (FUSD).

Both will be what is referred to in the crypto community as “truly decentralized” Bitcoin and USD tokens.

Unlike the former, which is based on a sequence of continuous futures contracts, the latter will simply be a basket of stablecoins. This prevents a design flaw for the stablecoin.

Serum hopes to draw enough attention to Solana to entice other initiatives to build on it. Sam Bankman-Fried is also considering publishing Sushiswap on Solana with community participation. It is unknown how the centralized Serum plan would work with the decentralized protocol governance, which is in its infancy.

 

Price analysis on Serum

Serum was initially launched in 2020 and its price analysis over the year and recently is as follows:

 

  2020 October November December January to date
SRM Price High $3.619 $8.97 $8.72 $5.55 $3.80
SRM Price Low $0.833 $6.94 $5.11 $3.33 $2.97
Market Cap $180.99M $1.20B $1.16B $759.27M $507.17M

 

Price prediction on Serum

Based on many technical indicators, SRM is expected to hit $8.760 by the first quarter of 2022. Pris d' Prediction: Serum will reach $8 by mid-year and $11.95 by year's end, excepting small revisions. The anticipated minimum value is $6.487.

 

Where can you buy Serum?

Serum can be bought, sold, and exchanged on two of the best crypto exchanges in the market as follows.

  1. FTX Exchange
  2. Binance

 

1. FTX Exchange: FTX is a well-known cryptocurrency exchange for purchasing, selling, and digital trading assets. FTX allows access to the finest spot trading procedures and the transfer of funds using money and reliable cryptocurrencies.

FTX services are designed to remain committed to the market's professional traders. In other words, the platform caters to the needs of seasoned traders.

 

PROS CONS
The KYC process is straightforward and quick, allowing an increase in trading limits Leveraged tokens on the FTX exchange are complex instruments that present a great risk
The platform offers comprehensive crypto derivatives trading The platform is not battle-tested
FTX guarantees liquidity on its exchange  
The exchange is known for its low trading fees  
Users can purchase crypto using credit cards  

 

2. Binance: Binance is a prominent exchange that captures the attention of investors by offering glow trading fees and a wide range of digital assets. Binance is one of the largest exchanges, and it has some of the best liquidity and 24-hour trading volumes in the cryptocurrency market.

In addition, the exchange is renowned for its security features and its high trust score. 

 

PROS CONS
The exchange has lower fees than other exchanges The site is not beginner-friendly
Traders can earn a 25% trading discount if fees are paid using the BNB token   

You can buy Serum safely from these cryptocurrency platforms.

Does Serum use coin burns?

Yes, Serum uses coin burns.

The first SRM burn occurred in September 2020, destroying $400k of SRM per the project's timeline. This accounted for the whole of Serum's income.

Another burn occurred in late April 2022, this time involving $600,000 in SRM that was dumped to stakers.

 

What is Serum’s largest Competitor?

Hydraswap is the largest competitor of Serum.

Hydraswap is a Solana DEX driven by an on-chain smart AMM optimized for Liquidity Providers' profitability. Hydraswap is developing an HMM algorithm (Hydra Market Making) by significantly improving existing AMMs, adapting to the expertise and returns of specialist market makers in terms of price.

 

What is the Staking Process involved with Serum?

The Serum DEX has a complex staking mechanism. To become a validator node, you must first invest 10 million SRM, 1 million in MSRM. Anyone can establish a node, become a Leader, and have others delegate SRM to them to become a validator. Each node may stake up to 100 million SRM.

Validator nodes facilitate cross-chain bitcoin swaps and “turn the crank” on the Serum network. Solana has a unique infrastructure, and orders on any third-party protocol are required to activate Serum DEX, such as validator nodes.

While node pay-outs are not written in stone, the yearly percentage return is set at 2%, with a performance bonus of up to 13%. These earnings come from Serum's 10% ecosystem fee.

In addition, the community has the power to adjust these fees in the future. However, users should note that the only location to stake SRM currently seems to be the FTX market.

 

What can Serum smart contracts do?

Serum's concept is centred on a decentralized order book powered by smart contracts that mimic existing exchanges by connecting buyers and sellers.

This provides participants with price and order size freedom when submitting orders to Serum, allowing them complete control over their trading. Serum makes use of powerful smart contracts to eliminate any human interaction from the system's essential functions.

Through assistance and community efforts, the network enables creators. When users join the Serum ecosystem, they may save money on their transactions and help boost DeFi adoption.

 

Is Serum a Good Investment?

Yes, Serum is a good investment.

By providing greater flexibility into the equation, Serum modifies the idea of DEXs. Developers may construct DEXs that mimic the functionality of a CEX (centralized exchange).

Stop orders and limit orders are standard features on CEXs but are not yet accessible to most DEX users.

This connection enables DeFi to benefit from the ease of centralized exchanges. Additionally, it assists in removing technical impediments connected with the transition from CEXs to DEXs, such as the absence of an order book.

By increasing the familiarity of the migration process, more people can make the transfer to a DEX without experiencing worry or misunderstanding.

 

Is Serum a viable Alternative Coin?

Yes, Serum is a good alternative coin.

  • Hacking – Serum has no history of hacking events.
  • Security – Serum can benefit from the robust security measures employed by Solana.
  • Transaction speed – Serum can offer fast transaction speeds because of its affiliation with Solana.
  • Technology – Serum offers innovative technology that boosts its applications, including SHA 256, DApps, Smart Contracts, Cross-chain trading, PoS, On-chain order books
  • Price Stability – Serum's price is not as volatile as other competitors and peers in the cryptocurrency market.
  • Potential Investment – Because of its affiliation with Solana, there is a lot of potential in Serum.

Any cryptocurrency that isn't Bitcoin is referred to as an altcoin.

What are the differences between Serum and Bitcoin?

Bitcoin is a digital currency that was launched in 2009. Marketplaces dubbed “Bitcoin exchanges” enable users to purchase and sell bitcoins in a variety of different currencies. Bitcoin can be used like any other currency to make hotel reservations, furniture purchases, or any other daily activities.

However, most of the Bitcoin hype surrounds making money trading it, which entails purchasing when the price is low and selling when it reaches a high.

Serum is a decentralized exchange platform based on Solana that allows traders to buy and sell coins. Solana is a blockchain platform that seeks to boost user scalability by enabling quicker transaction settlement times.

 

  Bitcoin Serum
Price change 20/21 +400% +90%
Market Cap $800 Billion+ 407.1 Billion+
Past Hacks None None
Popularity Very High
Altcoin Rank #1 – Original Crypto #148

 

What are the differences between Serum and Ethereum?

Ethereum is a large, prominent cryptocurrency. It is also a decentralized blockchain that can establish a comprehensive P2P network where users can execute and verify smart contracts.

Developers use Ethereum to construct and launch DApps and smart contracts. The decentralized exchange operated by Serum intends to automate this process on the blockchain by connecting vendors and buyers based on their requests.

Unlike automated market-making, which lets traders buy and sell cryptocurrencies through liquidity pools, Serum allows players to have complete control over their orders.

 

  Ethereum Serum
Price change 20/21 +880% +90%
Market Cap $460 Billion+ 407.1 Billion+
Past Hacks None None
Popularity Very High
Altcoin Rank #2 #148

 

What are the differences between Serum and Dogecoin?

Dogecoin is used to tip Reddit and Twitter users, although it is also accepted as payment by a few dozen retailers. It may be used to purchase groceries, household items, and even website domain names.

Serum's network and architecture are intended to ease trades in a manner comparable to established exchanges. Because Serum is on the Solana blockchain, it benefits from the speed and cost-efficiency of transactions.

 

  Dogecoin Serum
Price change 20/21 +7,300% +90%
Market Cap $22 Billion+ 407.1 Billion+
Past Hacks None None
Popularity High
Altcoin Rank #12 #148

 

What are the differences between Serum and NEO?

There are a lot of things that make Serum's network and design, like how transactions work in the real world. Serum is part of the Solana network, which makes transactions faster and cheaper.

This allows Serum to settle transactions on its own blockchain. It is possible to link the real thing to an avatar on the NEO network that is the same and unique as the real thing.

NEO also helps to protect assets. Those assets that are registered on its platform have a digital identity that has been proven to be real. They are protected by law. NEO can use two crypto coins: NEO and GAS.

 

  NEO Serum
Price change 20/21 +160% +90%
Market Cap $1.70 Billion+ 407.1 Billion+
Past Hacks None None
Popularity Medium
Altcoin Rank #69 #148

 

What are the differences between Serum and NFTs?

Nonfungible tokens (NFTs) are digital assets that each have a unique value, with no two NFTs holding the same characteristics or value as another. Serum, on the other hand, is fungible, which means that one SRM has the same value and characteristics as another SRM.

 

What are the differences between Serum and Solana?

Solana is a robust permissionless blockchain that attempts to scale without sharding. Solana is ideal for DApps that need high data rates.

Solana's creators claim 50,000 TPS. PoH timestamps are used to automatically link transactions that occur in fractions of seconds. Mainnet Solana became active in March 2020.

Its main purpose is to provide a quick and scalable one-layer solution for DApps. Serum is based on the Solana blockchain. Solana ecology is inextricably linked to the Serum project. Since Solana is the first true DEX, Serum has several advantages over other DEXs, including decentralization, on-chain order book, speed, efficiency, and cheap exchange costs. 

In addition to being Serum's native currency, SRM is also an SPL token on the Solana blockchain.

 

  Solana Serum
Price change 20/21 +9,300% +90%
Market Cap $54 Billion+ 407.1 Billion+
Past Hacks None None
Popularity Very High
Altcoin Rank #5 #148

 

What are the differences between Serum and Cardano?

In addition to being the preferred method of payment for transfer costs, SRM token holders may use SRM to minimize costs on Serum's exchange.

Serum is a non-custodial, order book-based DEX built on Solana. Low capital efficiency, high gas prices, centralization, and liquidity fragmentation are among the issues addressed by Serum.

Serum is not only permissionless, but the project also aims to decentralize the overall DeFi stack. Unlike Ethereum's proof-of-work settlement, Cardano's PoS consensus is more sustainable and environmentally friendly.

Cardano has an impressive throughput of 257 transactions per second (TPS). Cardano's blockchain reduces the number of nodes by choosing leaders to review and validate transactions from a group of nodes.

 

  Cardano Serum
Price change 20/21 +2,100% +90%
Market Cap $42 Billion+ 407.1 Billion+
Past Hacks None None
Popularity Very High
Altcoin Rank #7 #148

 

Can Serum exist without the Solana blockchain?

No, not unless Serum launches its own proprietary and native blockchain to move its token. Serum was constructed on the Solana Blockchain, giving Serum an inherent affiliation with Solana.

SRM is also a Solana Program Library (SPL) token, which is like Ethereum's ERC-20 standard, making it possible for Serum to issue tokens on Solana. This also means that Serum can benefit from the full suite of capabilities of the Solana blockchain, ensuring that its ecosystem can perform optimally.

Solana relies on the interoperability between its native blockchain and Serum.

 

What are the supported wallets for SRM?

Serum suggests the sollet.io SOL wallet for Solana-based digital assets. But an SRM currency may be stored in any crypto wallet. Ethereum-based wallets are completely interoperable with the Ethereum blockchain.

This means that users can use any of the following:

  • Brave Wallet
  • MetaMask
  • Bitski
  • Arkane

 

What is CeFi?

Centralized finance is an organized and specialized financial institution that lets consumers borrow or lend cryptocurrencies to earn interest. CeFi intends to improve trading, transaction processing, and buying and selling.

The central exchange sets its prices, leaving traders with no other alternatives. Despite its name, CeFi services aim to become more decentralized.

Some disadvantages of CeFi include increased transaction costs owing to third-party or intermediary engagement. Concerns with CeFi include lack of transparency and total control over cash. They also need personal information from users upon registration.

 

What is the difference between CeFi and DeFi?

Centralized Finance (CeFi) exchanges – function as an intermediary, facilitating the management of users' crypto transactions and activities.

Decentralized Finance (DeFi) exchanges – which do away with the necessity for a third party to monitor user activity, enabling technology to take over and people to take control of their transactions and deals.

 

The main differences between CeFi and DeFi relate to:

  1. Centralization
  2. Permission
  3. Trust 

 

1. Centralization: Exchanges or trading systems are held by a single organization or business under centralized finance. They provide a range of services to make crypto more accessible.

However, centralized exchanges handle everything — from user onboarding to defining ground rules. The community-owned DeFi apps strive to decentralize ownership.

Everyone gets input on how the program should work while its code is community-run and maintained.

 

2. Permission: Users must register and comply with KYC (Know Your Customer) rules with CeFi to avoid money laundering and follow crypto legislation. However, users can use DeFi without KYC or an account if they use a non-custodial crypto wallet like MetaMask.

 

3. Trust: With centralized money, users can only use trust exchanges and other centralized applications. In DeFi, users never need to trust anybody with their assets or exchange them via P2P.