What Is Sushi?

Sushi (SUSHI) is the native token for the SushiSwap exchange, which is a blockchain-based decentralized exchange. SUSHI owners can participate in community governance and stake th🤪eir tokens to earn🐻 some of SushiSwap’s transaction fees. Versions of the token can also be found on the Solana, Avalanche, Binance Smart Chain, and Polygon.

History of SushiSwap

SushiSwap was created in 2020 bꩵy an entity known as Chef Nomi. This entity created a fork of Uniswap, a popular decentralized exchange ꦍthat operates on the Ethereum blockchain. Both exchanges are similar in terms of their basic functionality.

In September 2020, founder Chef Nomi suddenly sold about 38,000 ETH worth of cryptocurrency in what appeared to be an exit scam. However, the founder returned the entire amount and turned the project over to then-FTX CEO Sam Bankman-Fried, who reportedly turned over control to developers andℱ the community.

In late 2021, SUSHI's value fell after news that the developers were leaving the project, but its outlook turned around in December 2021 when developer Daniele Sestagalli proposed that Avalanche take over the network. In a lengthy post on the Sushi forums, Sestagalli explained a path forward to evolve SushiSwap's governance structure and expand integrations, among other details.

In June 2024, the Sushi Decentralized Autonomous Organization (DAO) voted to transfer control of the SushiSwap project to create Sushi Labs. Sushi DAO created the following ꦉentities to govern development and execution and operate alongside the DAO:

• Sushi High Kitchen
• Treasury Council
• Grants Council
• Ambassador Council

The structure was created to lead the development of a multi-token suite and franchised decentralized exchanges, mitigate risk, enhance security, and drive growth. This move is somewhat controversial within some circles as it centralizes the development of a decentralized exchange and ⛦🀅its services.

SushiSwap vs. Other Exchanges

SushiSwap works differently from centralized exchanges like Coinbase and Gemini, where the exchanges conduct trades for their users. These centralized exchanges generally hold customer assets in custody, much like an online stock brokerage. On SushiSw💦ap, users are responsible for their individual cryptocurrency wallets. The exchange is not a custodian of deposited funds or ജcryptocurrency keys; it merely acts as a connection platform that uses smart contracts to execute trades between users.

To facilitate trade, portions of swap fees paid in cryptocurrency are locked with the exchange. This is called staking, and it is used by SushiSwap as a way to provide liquidity. Additionally, users can choose to stake their SUSHI in exchange for xSUSHI as shares of trading fees. This staking method is used to incentivize users to provide liquidity for others.

Future of SushiSwap

While SushiSwap is used by many cryptocurrency swappers, there's no telling how it will fare in the future. Its reported trading volume on Dec. 1, 2024, was $8.56 million, compared to Uniswap's $1.14 billion.

For SushiSwap and its community of users to continue into the future, it needs to do more to attract more users and remain relevant in a volatile and young market. Even amidst structural changes designed for growth, it will have to compel cryptocurrency users to switch to its platform—something many don't do once they have a preferred and trustworthy exchange they already use.

The Bottom Line

Ultimately, it is up to Sushi Labs, community members, and cryptocurrency market forces to decide the future of SushiSwap and SUSHI. Whether that’s going “澳洲幸运5官方开奖结果体彩网:to the moon,” as cryptocurrency fans like to say, or heading down in the dumps is something🔴 only time will reveal.

The comments, opinions, and analyses expressed on Investopedia are for informational purposes only. Read our for more info. As of the date this article was written, the author does not own SUSHI.