AMMs like Uniswap are very popular, but when users require stablecoin assets, they have to use Curve Finance. When they want to reduce Impermanent Loss risk, they turn to Balancer. This is why Osmosis was created to address these issues. Some adjustable functions through Osmosis Governance include:
- Changing transaction fees and liquidity withdrawal fees.
- Adding or removing supported assets in the AMM.
- Creating Pools with different token value ratios (similar to Balancer) to reduce Impermanent Loss.
Thanks to this concept, Osmosis can harness the combined strengths of Uniswap, Balancer, and Curve by allowing flexible customization of their Pool functions. This enables Osmosis to easily scale without the need to migrate liquidity, as seen in the transition from Uniswap v2 to Uniswap v3.
Osmosis has made IBC usage more widespread for Cosmos chains. Previously, IBC had been available for a few months but had not seen many connection requests from other chains, resulting in low IBC transaction volume. Osmosis provides the ability to trade and earn rewards through providing liquidity, leading to a growing demand for IBC usage. Show Less
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