Raydium automated market maker reviewed

What is Raydium, how does it work and how does it add value to the Solana ecosystem?

@RaydiumProtocol is an AMM built on top of the impressive @Solana blockchain. Raydium makes use of the central order book of the @ProjectSerum decentralized exchange (DEX) to enable uynbelievably fast trades, shared liquidity and features that allow users to earn yield on deposits.

Much like similar system such as Uniswap or Sushiswap, Raydium has a couple of really cool features. The big difference is that these features are a lot more fun to use as the transaction costs are lower and the execution speed a lot higher.

What can Raydium do?

Connect your wallet

The most basic feature of every AMM – connect your wallet. This is essential to start using Raydium. Currently Raydium supports the following wallets:

  • Ledget
  • Sollet (extension and web wallet)
  • Solong
  • MathWallet
  • Phantom
  • Bonfida

Once you’ve authenticated with a wallet containing some Solana, you are ready to use the application.

Swap currencies

Raydium’s Swap uses the decentralised order book of Serum. It’s easy to use and fast. Users can select to swap currencies supported by the Serum DEX. It looks great too!

Swap currencies after connecting your wallet. Swaps only work for pairs which are sufficiently liquid and supported on Serum.

Add liquidity

Raydium allows you to provide liquidity for supported pairs. Select two inputs to combine into liquidity pair (LP) tokens which can be staked and used to earn interest (also known as farming).

Farm rewards

As mentioned above, once you have LP tokens, you can stake these and start farming rewards or generating interest. Raydium provides a wide option of pools that generate different APR. The great thing about Raydium is that transactions are cheap, so you are able to reinvest your harvest often. This enables you compound your interest and generate serious returns. I’ve written about generating high APY previously.

Stake Raydium tokens

Raydium allows you to stake your RAY tokens and earn interest. The interest isn’t as great, but this option may be more attractive than staking the pools since there is no risk of impermanent loss, as there is no token pair.

Another benefit of this feature is that you may qualify for early access to token pre-sales on the AcceleRaytor launch pad. Bear in mind there is usually a minimum amount of RAY required to participate. But once you have a good chunk staked you should be able to participate in early token sales for projects built on Solana.


Let’s summarise the benefits of Raydium:

  • Faster and cheaper. Raydium uses the Solana blockchain which just works better and is more accessible than Ethereum.
  • Central order book. Raydium provides liquidity to the central order book of the Serum DEX, meaning that Raydium provides access to the order flow and liquidity of the enture Serum ecosystem.
  • Trading interface. Raydium provides tools for traders who want to set limit orders.

After a few weeks playing with Raydium I must admit it’s really fun to use on a daily basis. I’ve only experienced slowness once during the MEDIA launch. Whether you have previous DEFI experience, or just getting started, Raydium is a great place to experience the Solana blockchain and a glimpse into the future of finance.

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