End to End Guide to SushiSwap- A Decentralized Exchange

This article was published as a part of the Data Science Blogathon.

Introduction

A decentralized exchange (DEX) enables you to exchange (trade) crypto assets in a decentralized and secure manner. Decentralized Exchanges have evolved over time with new and unique features being implemented in the DEX. Cross-chain transfer of assets is one of the latest features of decentralized applications. This feature enables you to transfer and swap one crypto asset from one blockchain to another crypto asset to blockchain. SushiSwap, called xSwap implements this cross-chain transfer feature.

This guide will go through how to use SushiSwap, one of the most popular decentralized applications.

What is the Need for a Decentralized Exchange?

You use a centralized exchange (Binance, FTX, etc.) whenever you want to trade one crypto asset for another. These exchanges act as the middlemen between the buyer and seller of the crypto asset. To trade on a centralized exchange, you are required to deposit your assets on the exchange. Due to this, the exchange has control of your assets and not you.

To counter the above drawback, a decentralized exchange (SushiSwap, PancakeSwap) lets you trade one crypto asset for another directly from your Web3 wallet. Hence, you are not required to deposit your crypto assets on the platform and can trade directly from your Web3 wallet. Thus, keeping entire control of your crypto assets.

What is SushiSwap?

SushiSwap is one of the most popular decentralized applications in the crypto space. SushiSwap is a decentralized exchange that was initially built on the Ethereum blockchain but has now scaled to support multiple blockchains, including Avalanche, Polygon, Arbitrium, Moonbeam, Optimism, and many others.

SushiSwap currently has a total value locked (TVL) of over 1.3 billion dollars on the platform. SushiSwap’s native token is the $SUSHI token which can be staked on the platform to earn the additional yield (current rate is 12.91% APR).

Wallet and Blockchain Used

Web3 Wallet:

To use any decentralized application, a Web3 wallet is required. The wallet I will be using in this guide is the MetaMask wallet.

MetaMask is a Web3 crypto wallet that supports several blockchains and enables users to store, send, receive, buy and swap their crypto assets in a secure and decentralized way.

Blockchain:

To demonstrate the features and functions of SushiSwap, I will be connecting my Web3 wallet to the Avalanche blockchain.

Avalanche is a layer-1 blockchain which is a fast, low-cost, eco-friendly blockchain.

Connect Wallet to SushiSwap

Before interacting with any decentralized application (dapp), the first step is to connect your Web3 wallet to the dapp.

You can connect your wallet to SushiSwap by following the steps below:

1. Click on the Enter Sushi button on the SushiSwap homepage.
2. Click on the Connect Wallet button on the top right corner of the swap page.
3. Select the wallet you want to connect.
4. Choose the wallet account you want to connect the dapp to.
5. Click on the Next button.
6. Click on the Connect button.
7. Your wallet is now connected to SushiSwap. You can confirm it by viewing your public address in the top right corner of the swap page.

Once your wallet has been connected, you can begin using SushiSwap’s feature.

Swap

Swapping is a feature that allows you to trade crypto assets (as stated above) in a decentralized and secure manner.

To swap your crypto assets on SushiSwap, follow the steps below:

1. On the Swap page, click on the token icon to select which token you want to swap.
2. Search or click on the token you want to swap.
3. Enter the number of tokens you want to swap.
4. Click on the Swap button.
5. Click on the Approve button.
6. Click on the Confirm button in your wallet.
7. Click on the Swap button.

Confirm the transaction by clicking on the Confirm button in your wallet. Once the transaction is completed, your assets will be swapped.

xSwap

xSwap is one of the latest features of SushiSwap. xSwap is a unique cross-chain transfer swap feature that allows you to transfer and swap your crypto assets from one blockchain to another.

For example, if you want to convert your AVAX tokens from the Avalanche blockchain to MATIC tokens on the Polygon blockchain, you can do so using the xSwap feature.

To transfer assets from one blockchain to another on SushiSwap, follow the steps below:

1. On the swap page, click on the xSwap option.
2. Click on the dropdown arrow to choose the blockchain from which you want to transfer the assets.
3. Select the blockchain you want to transfer the asset.
4. Click on the dropdown arrow to choose the blockchain to which you want to transfer the assets.
5. Select the blockchain you want to transfer the asset.
6. Click on the token icon to select the token you want to swap and transfer.
7. Search or click on the token you want to swap and transfer for both blockchains.
8. Enter the number of tokens you want to transfer and swap.
9. Click on the Swap button.
10. Click on the Approve BentoBox button.
11. Click on the Sign button in your wallet.
12. Click on the Approve button.
13. Click on the Confirm button in your wallet.
14. Click on the Confirm Swap button.
15. Confirm the transaction in your wallet by clicking on the Confirm button in your wallet.

Once the transaction is completed, your crypto assets will be deposited in your wallet of the respective blockchain.

Earn

Earn is a feature that enables you to earn yield (interest) by adding liquidity to the decentralized application. Adding liquidity here means, depositing two of your crypto assets to the platform. A platform having more liquidity enables transactions to be executed quicker.

Add Liquidity:

To add liquidity to SushiSwap, follow the steps below:

1. In the navbar, click on the Earn option.
2. Click on the Networks dropdown option to select which blockchain you want to add liquidity too.
3. Select the blockchain you want to add liquidity to.
4. Select the Pool you want to add liquidity to.
5. Click on the Deposit button.
6. Enter the number of tokens you want to add as liquidity.
7. Click on the Add Liquidity button.
8. Click on the Approve button.
9. Click on the Confirm button in your wallet.
10. Click on the Add button.

Confirm the transaction in your wallet by clicking on the Confirm button in your wallet.

Remove Liquidity

1. On the Pool page to which you want to remove liquidity, click on the Withdraw button.
2. Enter the number of tokens you want to remove from liquidity.
3. Click on the Approve button.
4. Click on the Confirm button in your wallet.
5. Click on the Remove Liquidity button.
6. Confirm the transaction in your wallet by clicking on the Confirm button in your wallet.

Conclusion

There you go. You now know how to operate SushiSwap. You can thus transfer assets seamlessly across various blockchains. SushiSwap supports over 16k tokens. Most of these tokens may be scams and end up going to zero. Please perform intensive research before swapping your tokens, and be aware of risks associated with decentralized exchanges.

All the content in this article is purely for educational purposes and does NOT provide any financial advice. If you have enjoyed this guide, please let me know in the comments and consider following. Thank you for your time.

Key Takeaways

• Decentralized exchanges give us users complete control over our assets.
• SushiSwap is one of the most popular decentralized exchanges.
• Swapping is a feature that allows you to trade one crypto asset for another in a decentralized and secure manner.
• xSwap is a unique cross-chain transfer feature that allows you to transfer your crypto assets from one blockchain to another.
• The Earn feature enables you to earn interest for depositing your crypto assets on the platform.
• NO content in this guide provides any Financial advice.

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Myron

A crypto research analyst, algorithmic trader who is passionate about cryptocurrency, finance, investing and data analytics.
In this blog, I will be mainly focusing on how to use python programming language to derive meaningful insights from datasets in order educate and develop various investing strategies for assets.

In addition, I will be uploading "how to" guides on various decentralized applications running on a number of blockchains and "Top 5" guides. Furthermore, research articles on blockchain projects will be a part of the content.