Launching AMM liquidity pools, Hoo moves forward with big strides
TechFlow Selected TechFlow Selected
Launching AMM liquidity pools, Hoo moves forward with big strides
Since Hoo Exchange established its presence in Dubai and set up a global operations center last August, it has taken big strides toward internationalization.
Navigating Web3 tides with focused insightsBy 0xFly
Since Huobi Global's entry into Dubai last August and the establishment of its global operations center, it has taken bold steps toward internationalization.
It has rolled out new products one after another, constantly reshaping its image.
Given the current volatile market conditions in the exchange sector,
leveraging its agility and other distinctive strengths, Hoo has advanced rapidly.
Exchange Landscape Enters a "New Normal"
If Zheng He’s seven voyages to the Western Seas represented an early but tentative step toward globalization by ancient China, then Lin Zexu’s call to “open your eyes to the world” ushered in a lasting wave of international thinking for Chinese civilization.
From that point forward, people’s perspectives expanded beyond local fluctuations to encompass global changes.
This is an inevitable trend driven by profound historical evolution—an unstoppable tide of the times.
Today, this very trend is being replayed in the realm of crypto assets.
Early adopters relied on cryptocurrency media for news; used Feixiaohao or Bibox for project research; and closely followed the rivalry among the “Big Three” exchanges.
Now, these habits have been broken...
DeFi, NFT, DAO, Twitter, Discord, Mirror, Notion...
A constant stream of new concepts and globally-oriented products are now deeply integrating into every crypto enthusiast’s life.
With the rise of DeFi and the growth of DEXs led by Uniswap, coupled with increasingly stringent regulatory policies worldwide,
the landscape of cryptocurrency exchanges has entered a “new normal.”
Huobi’s overseas expansion has already dismantled the traditional “Big Three” structure. Meanwhile, participation in DeFi activities has gradually acclimated users to English-language trading environments and familiarized them with various “international” tools.
On the other hand, as Chainalysis reported in November last year, from Q1 2019 to Q3 2021, the number of DEXs doubled while CEXs remained unchanged.
According to Coingecko data, Uniswap’s trading volume has even surpassed Kraken and BitFinex, reaching $1.488 billion and ranking ninth globally among all exchanges.
Even CZ recently stated that he believes DEXs will ultimately replace CEXs.
Traditional exchange models are no longer suitable for today’s trading environment. Exchanges that fail to adapt promptly to this transformative wave are destined for obsolescence.
As Yan Fu wrote in *Evolution and Ethics*, “Natural selection, survival of the fittest.”
For traditional exchanges, adapting to the current landscape boils down to two paths: becoming more international and more DeFi-integrated.
Like Hoo Exchange—a typical representative of centralized exchanges—it has not only led the way by establishing a presence in Dubai, expanding its vision globally, and setting up a global operations center aimed at winning users worldwide, but also actively adopted the advantages of DEXs by launching AMM liquidity pools.
Hoo Launches AMM Liquidity Pools
In January this year, to enable more users to participate in platform liquidity building and earn rewards, truly allowing some early participants in the Hoo ecosystem to spot investment opportunities first, Hoo launched a test version of its AMM liquidity pool.
After a period of testing, on March 2nd, Hoo officially opened access to its AMM liquidity pool functionality for all users. During the prior gray-scale testing phase, select existing users had already gained early access and earned returns.
The so-called AMM liquidity pool refers to the Automated Market Maker mechanism. AMM allows all market participants to provide liquidity for trading pairs, forming well-funded liquidity pools. Asset prices fluctuate based on the ratio of the two assets within the pool, and liquidity providers can earn a share of the transaction fees generated by those trading pairs.
In fact, Hoo is not the first centralized exchange to introduce AMM liquidity pools.
Following DeFi’s explosive growth in 2020, users have grown increasingly accustomed to using swap functions like those on Uniswap, rather than relying solely on order book trading.
Starting last year, we’ve seen most major exchanges—including Binance—introduce instant swap features. Hoo also launched HooSwap. These centralized swap functions are quite similar to AMM liquidity pools in that they require users to supply liquidity and enable automated market making. However, since they operate on centralized platforms, there are no on-chain gas fees, resulting in lower transaction costs.
According to Hoo, this new AMM pool represents an upgrade over HooSwap. From Hoo’s perspective, the goal is primarily to open more avenues for users to engage in building the Hoo ecosystem. While order book trading mainly enables basic buy/sell actions, the AMM liquidity pool allows users to earn fee-sharing rewards by contributing liquidity.
For users wishing to try this product, they simply need to select the desired trading pair in the liquidity pool, transfer their corresponding assets into the “wallet account,” and click “Add Liquidity.” Once funds are deposited, they begin participating in revenue sharing.
Regarding revenue distribution, the formula per trading pair is: Distribution = Market Making Reward + (Transaction Fee Reward × Distribution Percentage).
The market making reward comes from the counterparty fees paid to the AMM market maker account, while the transaction fee reward equals the previous day’s 24-hour transaction fees for that pair minus the market making reward.
During distribution, the total actual reward is directly deposited into the AMM liquidity pool—that is, the corresponding market-making wallet account.
When users wish to exit, due to potential price deviations caused by rapid in-and-out movements and to better manage reward calculations and disbursements, Hoo has set certain conditions for redemption in the AMM liquidity pool. For example, each individual pool allows only one redemption operation every 24 hours, and funds cannot be redeemed until at least one hour after successful addition to the pool.
Users simply need to go to the liquidity pool interface, click the redeem button, and their assets will be transferred back to their wallet account in approximately three minutes.
Currently, Hoo has opened liquidity pools for BTC, HOO, and others against USDT. It was revealed that Hoo plans to continuously upgrade and improve the AMM pool functionality based on market demand, add more trading pairs, and introduce additional token incentives and Hoo VIP benefits.
Notably, Hoo’s AMM pool uses the same pricing formula as Uniswap, meaning impermanent loss may occur when asset prices experience significant volatility. However, under normal circumstances, the platform’s distributed rewards for liquidity providers typically far exceed any impermanent losses incurred.
Letting Some People See Investment Opportunities First
Everyone is different.
People in the world come in all shapes and forms, and everyone needs a unique trait to stand out and be remembered.
Cryptocurrency exchanges are no exception.
For instance, Coinbase stands for compliance, Binance for globalization, and FTX for derivatives.
Beyond these, other cryptocurrency exchanges also have their own distinguishing features.
Take Hoo, for example.
As a leading player in ecosystem development, Hoo Exchange has consistently worked on building a DeFi ecosystem atop its centralized platform. The launch of AMM liquidity pools aims to explore more channels for user earnings and offer greater opportunities for users to participate in the construction of the Hoo ecosystem—truly realizing the vision of “letting some people see investment opportunities first” and enabling them to take part.
Those who possess a clear understanding of the underlying logic driving an industry’s development can reap astonishing returns.
Whether it was Hoo’s strategic positioning throughout last year in areas such as NFTs, the metaverse, and GameFi, or the development of its own ecosystem including HSC and PuddingSwap, Hoo has been actively exploring new possibilities to bring more investment opportunities to its users.
Especially now, with the rise of Web3 concepts and numerous related innovations such as the metaverse emerging constantly, each new concept brings countless investment opportunities.
On November 18 last year, the head of Hoo Smart Chain (HSC) stated that due to severe homogenization in the development paths of existing public blockchain ecosystems, HSC would comprehensively explore and invest in the metaverse, aiming to provide effective solutions and fresh logic for the entire DeFi ecosystem.
Beyond HSC’s own initiatives, applications built on HSC are gradually breaking boundaries and evolving toward a more diversified ecosystem—for example, PuddingSwap.
Additionally, the Hoo ecosystem has launched the Tiger Cub Fund, investing in and incubating various blockchain projects across infrastructure, innovative sectors, and tool development, thereby offering Hoo users access to more valuable early-stage investment opportunities.
Precisely because of Hoo’s continuous innovation, the native token of Hoo Smart Chain, HOO, has surged over 2,300% from its launch in September last year to the present, at one point leading among mainstream exchange tokens.
Behind HOO’s impressive gains lies Hoo’s bold stride toward global expansion and the multilayered value creation within its application ecosystem.
Founded in 2018, after just three years of development, Hoo has attracted over 2.4 million registered users, with daily active users approaching 100,000, spread across 120 countries and regions worldwide.
Times of great chaos are also times of great competition—HOO is moving forward boldly on the global stage.
Join TechFlow official community to stay tuned
Telegram:https://t.me/TechFlowDaily
X (Twitter):https://x.com/TechFlowPost
X (Twitter) EN:https://x.com/BlockFlow_News
