Sushi is a decentralised exchange (DEX) known as SushiSwap. It enables users to swap cryptocurrency assets without relying on an intermediary, using automated market making technology to facilitate transactions. It's recognised for its extensive deployment on over 30 blockchains, making it a flexible platform in the decentralized finance (DeFi) sector.
Sushi operates as an automated market maker (AMM) on the Ethereum blockchain and other layer 1 networks. It uses smart contracts to execute trades and manage liquidity pools that users can provide liquidity to in exchange for receiving a share of the trading fees. These pools support the AMM mechanism by providing the necessary liquidity for users to trade tokens. SushiSwap employs an algorithm to automate the pricing of these tokens based on supply and demand dynamics within the pools.
SushiSwap provides several use cases:
SushiSwap was launched in August 2020 as a fork of the Uniswap protocol by developers known as Chef Nomi, Sushiswap, and 0xMaki. It gained notoriety early on when Chef Nomi controversially withdrew funds from the development pot but later returned them. Governance control was handed over to Sam Bank-Fried, CEO of FTX and Alameda Research. Despite initial hurdles, SushiSwap grew rapidly, implementing new features and solidifying its status within the DeFi ecosystem as a robust, community-driven platform.