Dynamicake

Project Description: Dynamic Fees for Cryptocurrency Swaps on PancakeSwap Overview

This project aims to implement a dynamic fee structure for cryptocurrency swaps on PancakeSwap, one of the leading decentralized exchanges (DEX) on the Sepolia. Unlike traditional fixed fee models, our dynamic fee system adjusts fees based on various factors, such as volatility, liquidity pool status, and transaction volume. This approach aims to optimize trading costs for users while ensuring liquidity providers are fairly compensated.

Key Features

Dynamic Fee Adjustment:

Fees are automatically adjusted based on predefined parameters. Lower fees during periods of high liquidity and low volatility. Higher fees during periods of low liquidity and high volatility to protect liquidity providers and discourage excessive risk. Market Condition Monitoring:

Real-time analysis of market conditions, including price volatility, trading volume, and liquidity levels. Integration with market data providers to ensure accurate and up-to-date information. Liquidity Pool Management:

Enhanced incentives for liquidity providers to maintain balanced pools. Adaptive fees that respond to the supply and demand dynamics within individual pools. User-Friendly Interface:

User interface git : https://github.com/GuillaumeLepin/front-dynamic-fees.git Seamless integration with the PancakeSwap UI. Transparent display of current fee rates and the factors influencing them. Detailed transaction receipts showing fee calculations. Smart Contract Integration:

Secure and efficient smart contract implementation for fee calculations. Compatibility with existing PancakeSwap infrastructure. Audited contracts to ensure security and reliability. Benefits

Cost Efficiency for Traders:

Traders benefit from reduced fees during favorable market conditions, enhancing their overall trading experience and profitability. Dynamic fees discourage manipulative trading practices by making it costlier during volatile periods. Fair Compensation for Liquidity Providers:

Liquidity providers are rewarded more during high volatility, compensating them for the increased risk. Encourages more stable and substantial liquidity provision, benefiting the entire ecosystem. Market Stability:

By adjusting fees based on market conditions, the system helps stabilize the market by mitigating the impact of sudden price swings and low liquidity scenarios. Promotes healthier and more sustainable market dynamics on PancakeSwap. Technical Approach

Algorithm Development:

Develop and test algorithms that dynamically adjust fees based on input variables such as liquidity, volume, and volatility. Utilize machine learning models to predict market conditions and adjust fees proactively. Smart Contract Deployment:

Implement dynamic fee logic within secure and efficient smart contracts. Ensure contracts are thoroughly tested and audited to prevent vulnerabilities. Integration with PancakeSwap:

Collaborate with PancakeSwap to integrate dynamic fee smart contracts into their existing infrastructure. Ensure a smooth user experience with minimal disruption to current operations. Continuous Monitoring and Improvement:

Set up monitoring tools to continuously track the performance of the dynamic fee system. Gather feedback from users and liquidity providers to refine and optimize the system over time. Conclusion

The dynamic fee project for PancakeSwap represents a significant innovation in the DeFi space, offering a more flexible and responsive fee structure that benefits both traders and liquidity providers. By leveraging real-time market data and advanced algorithms, this project aims to enhance the overall efficiency and stability of cryptocurrency trading on PancakeSwap.

ps : It's not finish, we didn't had the time and the knowledge to complete the project and to fully link the smart-contract and the front-end. It was our first ever hackathon, we gave everything.

We take inspiration from the dynamic fee of TraderJoe and we are using the new feature of PancakeSwapV4, the hook, to implement the dynamic fee.

We used RainbowKit to connect wallets and TailwindCSS for a sleek front-end. React was utilized for interactivity. We also integrated PancakeSwap's ABI to interact with their protocol and our swap pools.