Why is Reya Network a paradigm shift in DeFi scaling?

Author: Reya Labs, Medium; Compiled by: Baishui, Golden Finance

Grandly launching Reya Network - the world's first modular L2 for transaction optimization.

The network design creates the deepest liquidity, best capital efficiency, and highest performance for DeFi traders and liquidity providers.

Why create Reya Network ?

Reya Network is not another generic L2. This isn’t another hype narrative without substance, either. Instead,we solve real problems in DeFi scaling that cannot be solved by universal design. As the DeFi OG team, we know what these issues are. Best of all, we have found solutions to these problems.

The most important limitation of DeFi expansion is the massive liquidity fragmentation that has occurred, with every new exchange built on a universal rollup foundation competing for a limited supply of liquidity.

This results in shallow markets on all exchanges, harming the interests of traders and market participants. Generalizable designs also inherit issues such as run-ahead and harmful MEV, and have performance limitations due to the inability to execute in parallel.

Reya Network changes the way we think about scaling. We believe that networks need not be general-purpose but can be optimized for individual use cases. By focusing on a single use case, we go beyond technical improvements to focus on financial logic and liquidity. Therefore, Reya Network focuses on DeFi trading, optimizing for the three pillars of liquidity, capital efficiency, and performance.

3 pillars of Reya Network

1. Liquidity

The capital invested in Reya Network is effectively used to support transactions through a novel passive liquidity pool mechanism. This design creates instant shared liquidity for all exchanges operating within the Reya ecosystem, enhances market depth, lowers market entry barriers, and enhances users’ trading experience.

But the benefits of liquidity don’t stop there. By incorporating financial logic into the network design, Reya acts as a clearing protocol across exchanges. This eliminates liquidity fragmentation and allows liquidity to be organized as a network between exchanges.

As market makers can freely share liquidity between exchanges, the growth of the ecosystem enhances the underlying trading conditions on each exchange. In this way, we create a flywheel of “interoperable liquidity” for the first time in DeFi.

2. Capital efficiency

The margin engine logic is embedded into the Reya Network itself, which means that users have A margin account that can be used on multiple exchanges. In many ways, this created the first decentralized clearing house.

Reya Network’s margin engine logic is the most advanced in the cryptocurrency space, providing up to 3.5x capital efficiency improvements for traders and up to 6x capital efficiency improvements for LPs. Any exchange on the Reya network will automatically inherit this logic as long as it runs on the network.

3. Performance

Performance improvements are critical, so we make Reya Network lightning fast . With a block time of 100 milliseconds and a throughput of up to 30,000 transactions per second, Reya Network is one of the fastest EVM rollups.

In addition, transactions are executed on a "first in, first out" (FIFO) basis with zero gas fees, eliminating front-running and harmful MEV. This feature is built using a customized version of Arbitrum’s Orbit technology stack. Over time, more optimizations will be made, including continuing to move application-specific logic into the network design itself.

The importance of performance cannot be underestimated – DeFi currently accounts for less than 5% of all cryptocurrency trading volume, in part because it cannot compete with the high performance and robust user experience of CeFi venues. However, when performance improvements are combined with the convergence of modularity and underlying financial logic, we have to start asking why we can’t finally capture CeFi volume and put it on-chain for the first time. Not only will this bring massive trading volume to DeFi, it will also greatly increase transparency, robustness, and composability for all traders who join our DeFi ecosystem.

Who supports Reya Network?

Reya Labs is the creator of Reya Network and is run by the DeFi OG team. It has launched many successful startups in the past, including Voltz Protocol , the company's notional trading volume grew to over $30 billion in just 12 months.

We have backing from some of the biggest names in the industry, with funding from VCs like Framework, Coinbase, and Wintermute Nearly $10 million was raised.

On top of that, we have the support of an incredible community! Many of our community members have been working with us on previous projects and now help drive product development and accelerate adoption of Reya Network.

Future Roadmap< /h2>

Reya Network is a revolution in stages.

As a liquidity network, the logical first step is to launch the network with an inflow of liquidity. That’s why first on our roadmap is the Liquidity Generation Event (LGE) scheduled for April. More details about LGE will be released soon, so stay tuned.

After LGE, we will prove the concept of the Reya network by deploying a fully functional permanent DEX Reya Exchange. Reya Exchange will be the first exchange on the network and will also serve as a tool to attract more liquidity and traders, creating strong network effects for subsequent exchanges.

Subsequently, Reya Network will be opened to other exchanges, eventually becoming the foundation on which the new generation of DeFi depends.