Raydium is an automated market maker (AMM) platform built on the Solana blockchain. The platform allows the user to do swaps, trades, add liquidity, yield farming, staking, use the NFT launchpad, etc. all in a single interface. Being powered by the Solana network, the platform, by default, offers faster and cheaper transaction processing. The platform has a native governance token named RAY.
The major USP of the platform is its integration with the Serum decentralized exchange (DEX). That means Raydium’s users can access the liquidity of the entire Serum ecosystem along with the liquidity maintained by the Raydium liquidity pools.
We will cover the operation of the platform in our two-part article series. In the first part, we will explain the trading, swap, and liquidity features. And the remaining features will be covered in the next part.
In this part, we will explain from where you can get the platform’s native token. Also, how you can do trading, swaps, and add/remove liquidity into the Raydium platform.
Table of Contents
Platform Token
To use the Raydium platform, you need two tokens: SOL and RAY.
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SOL Token
The Raydium platform is based on the Solana network. Users are required to hold a sufficient amount of SOL tokens in their wallets to pay for the network fees. You can get the SOL token from many major platforms like Binance, Coinbase exchange, etc. Check the full list of supported platforms here.
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RAY Token
RAY is the native governance token of the Raydium platform. You can get the token from exchanges like FTX or Binance, or you can simply use the Raydium trade/swap feature to convert any supported token into RAY. Check the full list of supported platforms here.
Raydium Platform
To use the Raydium platform, visit this page. Click on Launch App and connect your wallet to access the platform.
Connect Wallet
The Raydium platform allows you to connect with a wide variety of wallets. Below are the different wallets that users can use to connect with the Raydium platform:
- Phantom
- Solflare Extension
- Solflare Web
- Sollet Web
- Sollet Extension
- Ledger
- MathWallet
- Solong
- Coin98
- Blockto
- Safepal
- Slope
- Bitpie
Connect with your desired wallet type. We have a Solflare extension wallet installed in our browser that we will use to connect with the platform.
Trading
The Raydium platform offers a trading console to its users similar to a centralized exchange. The Raydium liquidity is contributed by its liquidity pools along with the Serum order book shared by the Serum users. The benefit of this integration is that the platform’s users can enjoy more liquidity with less slippage for their transactions.
Currently, users can place only buy/sell limit orders using different token pairs with the platform’s native RAY token.
To use the trading platform, visit the link here.
Users can access the trading interface by connecting it with any of the below wallets:
- Sollet.io
- Sollet Extension
- Ledger
- Solflare
- Solflare Extension
- Phantom
- MathWallet
Connect with your desired wallet and enjoy the high liquidity from dual liquidity sources at a cheaper and faster rate.
Swap
Using the swap feature, users can convert two tokens in the Solana network. You will find two fields on the swap page. The first field is where you can enter the token that you wish to give. And in the second field, you need to enter the token that you want to get in return.
Select your tokens first. Now enter the amount of the source token that you wish to exchange. The application will show the number of resultant tokens that you will receive.
Confirm the process. You can see the resultant token in the wallet once the transaction is successful.
Users performing swap activity in a Raydium liquidity pool need to pay a trading fee of 0.25%, which is further divided into the following:
- 22% is redeposited into the liquidity pool and distributed to the liquidity providers.
- 03% is sent to the staking pool and distributed as a reward to RAY stakers.
Pools
The Pools section contains the lists of liquidity pools that are currently available in the Raydium platform. Users can deposit their tokens into the pool and become liquidity providers. A liquidity provider receives a reward of 0.25% of the trading fee that occurs in their pool. They also receive a liquidity pool token that represents their share in the pool.
Check the full list of pools here.
Interested users can also create a new pool by providing a unique Serum market ID and setting up the base price and token initial liquidity.
You can read this guide here to know more about creating a pool.
Add Liquidity
Select your pool from the Pools list where you wish to deposit your tokens. Note that you must deposit an equal amount of both the tokens that constitute the pool.
We have some SOL and RAY in our wallet that we will use to deposit into the liquidity pool. Select both the tokens. Now, enter the amount of one token and the amount of the other token will fill automatically.
Confirm the process by clicking on the Supply button.
Once the transaction is successful, you will become a liquidity provider in that pool. You are eligible to earn rewards from every transaction that involves your participating pool.
Remove Liquidity
At any time, users can remove (partial/complete) their liquidity from a participating pool and free their tokens. When a user chooses to remove their liquidity, they get their tokens back along with the fees that they have earned during the period their tokens were there in the pool.
To remove liquidity, expand your liquidity details. You will find the remove button. Click on the Remove button, and a page will pop up where you can enter the amount of liquidity pool tokens that you wish to withdraw.
Confirm the process. Once the transaction is successful, the liquidity pool balance will become zero, and the contributing pool tokens go back to your wallet.
In the next part of this article series, we will discuss the farming, staking, NFT launchpad, and launchpad supported by the Raydium platform.
Resources: Raydium
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