What is Swipe (SXP): Where to next for former crypto card issuer?

Roadmap is unclear for Swipe, which has undergone a dramatic transformation in the past year

Swipe logo against star constellation – Photo: Shutterstock                                 
Swipe could benefit from a clearer vision to gain would-be investors. Photo: Shutterstock
                                

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When Swipe was launched in 2019 by Joselito Lizarondo, a tech start-up expert, he aimed to take on the burgeoning crypto card sector with a smorgasbord of user features, robust insurance policies and generous card-holder rewards.

Swipe quickly caught the eye of the exchange giant Binance, which acquired the company in June 2020 for an undisclosed sum in a private deal.

Since then, Swipe has undergone a transformation from a front-end crypto-card offering to the application programming interface (API) underpinning Binance’s own crypto card, which was released to UK and EU customers in July 2020.

Swipe provides similar back-end services to FTX, the US-based crypto exchange, which also released its own crypto card.

So while Swipe’s own crypto card enjoyed only a brief spell in the sun, the company itself thrives as an API underpinning a number of importgant partners, while also operating its own decentralised exchange (DEX), which is currently in beta mode.

Making all of this possible is the Swipe (SXP) token, Swipe’s native cryptocurrency, which is based on ERC-20 protocols.

How does Swipe work and what is the Swipe coin used for?

What is an API?

An application programming interface (API), at its most basic description, allows two different applications to speak to each other. Did you use PayPal to purchase something on eBay recently? An API made that possible.

As an API, Swipe helps to tackle an increasingly important issue: How can we bridge the gap between cryptocurrency assets held in a wallet and a brick-and-mortar vendor who only wants to deal in fiat money?

Swipe’s API protocol does this by handling the point-of-sale (POS) conversion behind the scenes.

SXP: Swipe’s native token

As with the Swipe company itself, the Swipe cryptocurrency went through a big transition period because of Binance’s acquisition. SXP was initially designed as a staking mechanism for Swipe's erstwhile crypto card. In simple terms: In order to receive a Swipe crypto card, a certain amount of SXP needed to be “staked”. This form of collateral allowed for the complete elimination of transaction fees.

In its current form, the SXP token is the fuel that runs Swipe’s API. It can be used for paying transaction fees, but more importantly, it is the API’s medium of exchange.

What that means is that while POS payments can be conducted with your cryptocurrency of choice, ultimately the transaction is processed through the SXP protocol. This happens behind the scenes; the end user of a Binance or FTX card need not worry about what is going on.

Image of Binance crypto card and associated features – Photo: binance.com
Swipe technology powers Binance's crypto card. Photo: binance.com

SXP also acts as the governance token for Swipe’s blockchain ecosystem, the Swipechain, which was initially forked from THORChain, a cross-chain decentralised exchange, or DEX, used for  swapping crypto-assets such as Bitcoin and Ethereum across blockchain networks.

Lizarondo raised eyebrows when he burned his entire SXP wallet in April 2021, thus reducing the total supply of SXP by 17%. In a blog post, Lizarondo said that he was giving up “a probable billion dollars in the future” because “I am not motivated by money. I am motivated by running a successful business.” 

Swipe Swap: The automated market maker

Decentralised exchanges (DEX) have exploded in popularity recently, with the likes of Uniswap and PancakeSwap posting increasing trading volumes.

Put simply, Swipe Swap, like its competitors, aims to allow for the purchase and exchange of cryptocurrencies on a peer-to-peer (P2P) basis instead of through a centralised exchange (such as Coinbase or even Swipe’s parent company, Binance).

This decentralised approach eliminates the need for a middle man and champions the blockchain’s trustless, decentralised philosophy.

Swipe Swap wants to take things further than its competitors in one key aspect: While Uniswap only allows for the exchange of Ethereum-based tokens, and PancakeSwap for Binance-based tokens, Swipe Swap wants to provide interoperability between the two.

Transactions on the Swipe Swap DEX will be made possible through liquidity pools, which are crowdsourced pools of tokens used to generate the liquidity which would previously be provided by an exchange.

Since these liquidity pools are crowdsourced, incentives are required to keep providers happy. This is done via the distribution of trading fees and rewards.

For those seeking rewards for providing liquidity, a cited 0.3% of fees of all trades will be distributed, proportional to the amount of liquidity provided.

Finally, transactions will be secured through the delegated-proof-of-stake (DPoS) mechanism, which rewards nodes with SXP for verifying transactions. This is considerably more energy efficient than Bitcoin’s proof-of-work (PoW) protocol.

Swipe Swap is currently in beta mode, and the current all-time trading volume on Swipe Swap is $216.12m, with a total of less than $650,000 of fees paid out to liquidity providers so far. Total liquidity at time of writing is $3.89m. 

When you compare this to Uniswap’s $3bn trading volume and $4.92m fee distribution in 24 hours alone, Swipe Swap clearly still has a long way to come.

SXP tokenomics and key facts

SXP is currently trading at $2.33. The current circulating supply is 192,768,788 (80% of current maximum supply), making for a market capitalisation of $449.15m. SXP is ranked at number 166 on the market cap charts.

The Swipe cryptocurrency initial coin offering (ICO) was launched on 1 August 2019 with an initial offer price of $0.20, meaning that SXP has risen more than 12-fold over its lifespan. It raised $12m over the course of its week-long ICO.

SXP uses a deflationary model to keep its price in check, meaning a certain number of tokens are scheduled to be burned on-chain over time, pegged to the rate of demand and user uptake of the Swipe protocol.

Once the total supply of SXP dips to 100 million units, no more tokens will be burned.

Where next for Swipe?

The company is frustratingly tightlipped about solid future plans, with up-to-date roadmaps not provided and only an outdated white paper currently available.

However, community engagement is robust, with a constant flow of blogs and Telegram posts released.

It is very much “watch this space” with Swipe. Its API protocol is comfortably running numerous crypto cards, but the success of its own DEX remains to be seen.

For more information on how Swipe coin is trading, be sure to check out our Swipe (SXP) predictor.

FAQs

There is a current circulating supply of 192,768,788 (80% of current maximum supply). As a deflationary currency, maximum supply decreases over time as tokens are burned.

Swipe is majority owned by Binance, which bought the company in July 2020 for an undisclosed sum. Swipe was initially founded by Joselito Lizarondo.

Binance is the most popular exchange for buying and selling SXP. SXP is not currently available at currency.com. Please do your research before trading in crypto assets.

Further reading

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