Investing In SushiSwap (SUSHI) – Everything You Need to Know

What is SushiSwap (SUSHI)?

SushiSwap (SUSHI) is a decentralized, multi-chain automated market maker (AMM) and DeFi token that continues to experience growing adoption. Initially created to enhance Uniswap’s popular Ethereum DApp, SushiSwap integrates additional community control mechanisms and DeFi features.

Today, SushiSwap operates as the ultimate multi-chain DEX, live on over 40 blockchain networks, allowing users to easily swap a wide range of assets. SushiSwap’s innovative approach and extensive cross-chain functionality make it the most versatile DEX on the market.

AMM vs DEXs

Automated market makers (AMMs) like SushiSwap have gained popularity for their ability to address common decentralized exchange (DEX) challenges, such as liquidity. SushiSwap’s advanced swap and aggregation stack, which spans over 40 chains, enhances liquidity and pricing options by providing access to liquidity from multiple blockchain networks.

Additionally, AMMs like SushiSwap enable automatic trading liquidity between any two cryptocurrency assets through smart contracts, bypassing the need for order books and central authority.

What Problems Does SushiSwap (SUSHI) Solve?

In addition to reducing market centralization, SushiSwap’s multi-chain capabilities solve accessibility issues by allowing users to trade across 40+ chains. This cross-chain reach, combined with SushiSwap’s secure, non-custodial trading model, means users can trade directly from their wallets.

SushiSwap’s model reduces custodial risks, giving users greater coin selection and flexibility while also prioritizing community-driven governance and decision-making.

Benefits of SushiSwap (SUSHI)

SushiSwap is designed to support DeFi users, allowing them to swap tokens, add liquidity to pools, and earn passive income in multiple ways. SushiSwap’s liquidity providers benefit from innovative options like Smart Pools and a no-impermanent loss (no-IL) AMM, ensuring reduced risk and steady rewards. Furthermore, as a multi-chain DEX, SushiSwap ensures that users can access liquidity and competitive pricing across multiple blockchains, positioning it as a highly attractive DEX for diverse asset swaps.

Passive Income

One of SushiSwap’s biggest benefits is its dedication to rewarding liquidity providers. SushiSwap offers substantial rewards through pools, like the SUSHI/ETH pool, which pays out double rewards. SushiSwap was the first AMM to redistribute all profits back to the community that maintains it, creating a sustainable and rewarding system for contributors.

Fees

SushiSwap fees remain highly competitive compared to centralized exchanges like Coinbase. The platform charges a 0.3% fee for joining liquidity pools and includes a small one-time transaction fee for approving new token pools. These fees contribute to a cost-effective trading environment that appeals to both new and experienced DeFi users.

Governance

SushiSwap’s governance has evolved to emphasize community-driven decision-making, though it still relies on SUSHI token holdings to determine voting power. Through its governance model, users can propose and vote on key upgrades, changes to reward structures, and new features. However, active participation can vary, and significant proposals may require the engagement of larger SUSHI holders to reach quorum.

Additionally, SushiSwap’s governance includes a unique “Sushi DAO” structure, which reserves a portion of each newly issued SUSHI token specifically for ecosystem development. This fund is controlled by the community, with token holders voting directly on how to allocate these resources to support projects like Sushi Labs’ initiatives (e.g., Susa, Saru, and Wara).

In recent governance improvements, SushiSwap introduced forums and Snapshot voting—a non-binding, gas-free voting platform—to allow broader community engagement in the preliminary stages. While Snapshot votes indicate community sentiment, binding changes typically go through on-chain voting processes. The Sushi DAO also occasionally seeks outside advisors for strategic input, making SushiSwap governance both community-centered and adaptable to changing DeFi trends.

Support

Since its launch, SushiSwap has garnered considerable support from the crypto community and DeFi platforms. SUSHI’s availability on major exchanges contributed to its rapid growth. Today, Sushi Labs, the development arm of Sushi DAO, continues to drive innovation by building a multi-DEX ecosystem through projects like Susa, Saru, and Wara, which aim to strengthen SushiSwap’s multi-chain capabilities further.

Staking and Farming

SushiSwap provides access to popular DeFi features such as staking and farming, which allow users to earn consistent returns with reduced effort. By staking SLP tokens, users can earn SUSHI rewards, and by staking SUSHI, they can acquire xSUSHI, unlocking further passive income. SushiSwap’s liquidity solutions, including Smart Pools and other advanced options, make it a highly appealing platform for users seeking to maximize returns with minimal risk.

How Does SushiSwap (SUSHI) Work

Built as a hard fork of Uniswap, SushiSwap runs on the Ethereum blockchain and supports all ERC-20 wallets. SushiSwap’s multi-chain nature, however, sets it apart by allowing users to swap assets across 40+ blockchains, making it highly accessible and versatile.

DEX

At the core of SushiSwap is its decentralized exchange (DEX), which allows users to browse an extensive list of tokens and execute trades within seconds. Since SushiSwap is non-custodial, it never holds users’ assets, providing additional security and freedom for its users.

Sushibar

The SushiBar feature allows users to stake SUSHI tokens and earn xSUSHI in return. xSUSHI stakers benefit from a portion of platform fees, making SushiBar an attractive option for those seeking passive income.

Liquidity Farming

SushiSwap’s liquidity pools form the basis of its platform, allowing users to lock their crypto assets and earn rewards in return. The multi-chain expansion has improved liquidity options, making it easier for users to find rewards that fit their investment preferences without needing to participate actively in trading.

SUSHI

SUSHI, the ecosystem’s ERC-20 token, serves various purposes, including staking rewards, governance, and a share of exchange fees. Holding more SUSHI translates to greater governance power, reinforcing SushiSwap’s user-centric governance model.

SLP Tokens

SLP tokens represent liquidity pool contributions, entitling holders to earn fees and rewards. SLP tokens can also be farmed, creating an additional layer of returns for liquidity providers.

xSUSHI

xSUSHI is a staking token available to those who stake SUSHI in SushiBar. xSUSHI holds more value than regular SUSHI, as it enables holders to earn a share of exchange fees, thereby enhancing the potential for long-term growth.

History of SushiSwap (SUSHI)

Launched in early 2020, SushiSwap’s development team opted not to premine before launching the DEX on Ethereum. Despite facing initial challenges—including a high-profile “rug pull” in September 2020—SushiSwap regained trust after Chef Nomi returned the funds and transferred control to Sam Bankman-Fried. Today, Sushi Labs continues to drive SushiSwap’s development and multi-DEX ambitions, contributing to its resilience and prominence in the DeFi space.

SushiSwap (SUSHI) Rug Pull…Almost

Sadly, in September 2020, SushiSwap’s developers pulled a rug pull. A Rug pull is when a project’s developer suddenly, and without warning, withdraw a huge amount of funds from the project. In this instance, Chef Nomi decided to withdraw 38,000 ETH from the platform’s liquidity pool. The decision caused a huge ruckus amongst the community with most condemning the maneuver as fraudulent.

SushiSwap (SUSHI) Homepage

Interestingly, Chef Nomi wised up and returned the ETH to the pool. However, by that time, trust was lost, and ownership of SushiSwap was passed to Sam Bankman-Fried. While he has since become infamous within the digital asset sector, Bankman-Fried helped restore faith in the project due to his stellar record in the market at the time. He had previously served as the CEO of FTX and the quantitative trading startup Alameda Research.  Since then, the project has worked to distance itself from either figure.

How to Use SushiSwap (SUSHI)

To use SushiSwap, users need to acquire Ethereum, set up a compatible wallet, and connect it to SushiSwap’s interface. SushiSwap’s multi-chain functionality allows users to swap assets across various blockchains. When choosing liquidity pools, users are encouraged to DYOR (do your own research) to ensure they select reputable projects.

DYOR

Once you make your decision, you are ready to link your ERC-20 compliant wallet. This step is very easy. There is a “Link to your Wallet” button on the main screen. Hit the button and you will be redirected to your wallet. Input your password and your wallet is linked.

Now, you are finally ready to add your crypto assets to the liquidity pool that best meets your investment strategy. Once you stake your tokens, you will receive SLP tokens. These tokens appreciate in value as the project’s liquidity pool increases. Additionally, you can then farm these tokens to earn more rewards.

How to Buy SushiSwap (SUSHI)

SushiSwap (SUSHI) is currently available for purchase on the following exchanges:

Coinbase – A publicly traded exchange listed on the NASDAQ. Coinbase accepts residents from 100+ countries, including Australia, Canada, France, Germany, Netherlands, Singapore, the United Kingdom, and the United States (excluding Hawaii).

Kraken – Founded in 2011, Kraken is one of the most trusted names in the industry and offers trading access to over 190 countries, including Australia, Canada, Europe, and the United States (excluding Maine, and New York).

Kraken Disclaimer: Not investment advice. Crypto trading involves risk of loss. Payward European Solutions Limited t/a Kraken is authorised by the Central Bank of Ireland.

How to Store SushiSwap (SUSHI)

If you seek to make a major investment in SUSHI or if you are planning on HODLing this crypto for long periods of time, a hardware wallet is the best option. Hardware wallets keep your crypto stored offline in “cold storage.” This strategy makes it impossible for online threats to access your holdings. The Ledger Nano S or the more advanced Ledger Nano X both support SushiSwap (SUSHI).

SushiSwap (SUSHI) – A Project that Rose from the Ashes Thanks to a Vibrant Community

Despite a controversial beginning, SushiSwap’s community-oriented model and multi-chain innovations have positioned it as a leader in the DeFi market. SushiSwap’s cross-chain DEX ecosystem, supported by Sushi Labs, offers users diverse liquidity options, making it a top choice for those seeking an alternative to centralized exchanges and a rewarding DeFi experience.