Is It Worth Investing In SushiSwap?

Last Updated February 7th 2022
15 Min Read

Decentralized exchanges (DEXs) are becoming more and more common, with Waves, EtherDelta, and others appearing on the scene recently. SushiSwap is one of these new decentralized exchanges that adds an interesting twist - users can earn money while trading by providing liquidity (acting as market makers).

While Sushiswap is not the first of its kind, it does offer some interesting functions that could bring the DEX into the forefront of trading.

With a low market cap and token value, can SushiSwap's tokens be profitable to buy? Or is SushiSwap just another overhyped decentralized exchange?

Let’s find out. 



What Exactly Is SushiSwap?

SushiSwap is a decentralized exchange built on the Ethereum blockchain. A decentralized exchange (DEX) is not controlled by a central authority, which means you won’t need to trust the handling of your assets to a third party.

Instead, trades are executed via smart contracts. Because of this, decentralization ensures that SushiSwap cannot be shut down by any one party (such as a government), and because it runs on the blockchain, it is transparent and secure.

SushiSwap also offers a unique function - users can earn rewards by providing liquidity. This means that they can act as market makers, buying and selling tokens to ensure that there is always a market available for trading.

Essentially, SushiSwap allows you to swap one token for another, earning rewards as a market maker.

In order to do that, you first need to lock up assets into smart contracts. Then, traders buy and sell tokens from those pools, swapping one token for another. This is an interesting twist on decentralized exchanges that could bring more users to the platform.

Sushiswap is not an original invention but a fork of Uniswap. Uniswap is a protocol for decentralized exchanges on the Ethereum blockchain. It was designed by Hayden Adams and launched in 2018.

SushiSwap is essentially the same thing as Uniswap, but with some added features.

The SushiSwap Token (SUSHI) is an ERC20 token built on the Ethereum blockchain. SUSHI plays a key role in the operation of Uniswap. For instance, it is used for governance purposes on the protocol and as a way to pay rewards to liquidity providers.

There is currently 127,244,443 SUSHI in circulation with a max supply of 250,000,000 SUSHI.

Sushiswap was launched in 2020 by a pseudonymous person only known as Chef Nomi. Another individual by the name 0xMaki is also said to have taken part in the creation of the decentralized exchange.

How Does SushiSwap Work?

Unlike centralized exchanges like Binance, Sushiswap is an automated market maker. This means the DEX has no central authority to take control of your assets.

So, instead of directly buying tokens from other traders, you buy them from the liquidity pool. When you want to sell, you do so by selling back to the liquidity pool.

In order to trade on Sushiswap, you first need to deposit some tokens into a smart contract. These tokens will then be used as collateral for your trades.

Once the tokens are in the contract, you can start trading. You can either trade directly with other traders or buy and sell tokens from the liquidity pool.

Users who contribute to the liquidity pool by providing buy and sell orders are rewarded with SUSHI tokens, a process known as yield farming.

This is a way to incentivize users to provide liquidity and keep the market running smoothly.

The rewards are paid out according to a formula that takes into account the size of the trade, the time taken for the order to fill, and other factors.

You can claim your assets from the liquidity pool and the rewards earned at any time. Note that if you trade against the locked assets, you will have to pay a fee. This fee is then distributed to the people who provide liquidity based on how much they contributed to the pool.

In addition to yield farming, you can also earn some passive income on Sushiswap through staking. You do this by using SushiBar, a tool that allows you to stake your SUSHI tokens and earn another token known as xSUSHI (more on this later).

Check Out: Could SushiSwap Be A Millionaire-Maker Coin? 

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Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

SushiSwap (SUSHI) Price History

SushiSwap was launched in September 2020, which means it doesn’t have a lot of price data to look at. However, for the short time that it has been on the market, it has created quite an interesting trajectory. 

According to historical price data from CoinMarketCap, SUSHI began trading in early September, where it opened at a price of around $1.2 per coin. Although this is much lower than its current price, it was quite plausible considering that most coins start trading at humiliatingly low prices. 

Within the first few days, SUSHI’s price spiked and went as high as $8.9. However, as is the case with most price jumps, there was a devastating crash that sent the price back to as low as $1.9 about 5 days later. 

From here, SUSHI struggled and continued dropping until November 2020 where it bottomed out at $0.49. However, at the start of December, the coin began rising again in value and crossed $2. 

SUSHI’s real recovery began in early 2021. This was around the time that a market-wide bull run was just getting started. The coin kicked off 2021 at around $3.3 per coin, but by mid-January, it had crossed $7. 

Between January 21st and February 4th 2021, SUSHI’s price grew from $5.6 to $15.45, representing a 175% growth within two weeks. There was a slight drop to just above $13 per coin, and then SUSHI began fluctuating with no clear trajectory. 

Towards the end of February, it crossed $18 and then dropped again to $14  before rising to attain its current all-time high price of $23.38 on March 13th, 2021. This was followed by a downward spiral that saw SUSHI trading at as low as $10.7 on April 10th. 

It then rose again and crossed $21 in mid-May before crashing down to $9.1 within a week. 

SUSHI kept dropping for the most part of June and July and even went to as low as $6.6 in mid-July. The coin experienced a  lot of fluctuations going forward, with the price dropping and rising without warning. However, it has not been able to cross $25 since the May crash and has mostly been struggling below $13. 

SUSHI recorded a steep drop from early September and went to as low as $5.8 in early December. 

It is now trading at around $4.7, although the price keeps changing within hours. This means that SUSHI has lost more than 79% of its peak value. 

The coin has a relatively low market capitalization of around $608 million and is currently ranked the 116th biggest cryptocurrency by market cap.  

SushiSwap (SUSHI) Price Prediction For 2022 And 2023

There is generally a positive outlook concerning the future price of SUSHI. Based on most predictions we have seen, price experts believe that despite the recent downtrend, SUSHI will rise in 2022 and 2023 and probably surpass its current all-time high. 

Although Wallet Investor predicts a rather leisurely growth in 2022, it still shows good signs of the coin rising. 

According to the site, in late May 2022, SUSHI might surpass the $12 level and then hit $13 at the end of August. Towards the end of September, the coin might trade at $13.12 per coin before crossing $13.61 in late November and closing the year at around $13.9 per coin. 

For 2023, the Hungary-based price analyst predicts that SUSHI will start at $13.5 and then quickly cross $14 per coin by mid-January. The coin will then trade on the $14 level until June when it goes above $15.

SUSHI's value will cross $16 in late October before closing the year at $16.39 per coin, which is, unfortunately, less than its current all-time high price of $23.38. is even much more optimistic about the future of SushiSwap. It predicts that the coin will start 2023 at around $9, and by the end of Feburary, it will be trading at more than $40 per coin. 

As you can see, this is a much more fast-paced growth compared to Wallet Investor’s predictions.

The site predicts that there will be a lot of volatility throughout the year, but SUSHI might go as high as $10 per coin by the end of 2022. predicts 2023 to be even more exciting, with SUSHI closing the year at $50. 

Although they might seem a bit too bullish, these are quite promising predictions. If they were to come true, it will not only mean that current investors will reap big benefits, but also the project will see more adoption as more people finally begin to see its potential. 

Generally, we can expect SUSHI to be much more valuable in the next two years. Although the coin has recently dropped and is not among the top 100 most valuable cryptocurrencies, it is still worth keeping an eye on. 

So, if you are convinced that SUSHI could be a good addition to your portfolio, there are several ways you can invest in it. 

Let’s go through these options in the next section. 

Don't Miss: SushiSwap Price Predictions

How To Invest In SUSHI

While SUSHI is not one of those coins that have big potential for price appreciation, it is still a worthy investment. This is because SUSHI acts as a utility token that gives you access to the features of the exchange.

This means that if the usage of Sushiswap goes up, so will the value of this coin. Moreover, since a low percentage of tokens are in circulation, there is a good chance that the price could go up in the future.

Based on its model of operation, there are four ways you can invest in SUSHI. These are:

  • Holding
  • Trading
  • Yield Farming
  • Staking

Method 1: Holding

One way to invest in SUSHI is to hold it as a long-term investment. This is the simplest way to gain exposure to the coin and does not require any technical knowledge.

Holding (also known as HODLing) is where you buy tokens and hold them for a long period of time with the hope that the price will go up.

This method is often used by investors who are not interested in trading or do not have the technical knowledge to do so.

In order to start holding SUSHI, you need to first buy some tokens. You can do this on any exchange that supports SUSHI. Once you have the tokens, you need to store them in a wallet.

There are many wallets that support ERC20 tokens, but our personal favourite is the Ledger Nano S. You can also use ERC-20 wallets like MyEtherWallet, MetaMask, and Mist.

When you are ready to sell, you can do so on any exchange that supports SUSHI.

Method 2: Trading

Another way to invest in SUSHI is by trading it on various exchanges. This involves buying tokens when the price is low and selling them when the price is high, but in a short period of time.

This method requires you to have some knowledge of technical analysis and be able to spot good entry and exit points.

You can use tools like CoinMarketCap to find out which exchanges have the highest volume for SUSHI trading. Currently, you can buy and sell SUSHI on several exchanges.

These include:

  • Coinbase
  • Binance
  • Gemini
  • eToro

You can use any of these exchanges, but we find eToro more convenient. This is because it has low fees and supports all the major cryptocurrencies, including SUSHI.

If you are just starting out, we recommend that you sign up for eToro. This is because it is one of the most beginner-friendly exchanges, which means you will have an easy time trading SUSHI on it without getting overwhelmed by too many features.           

Method 3: Yield Farming

Another way to invest in SUSHI is by using the yield farming feature of the Sushiswap exchange. A user who contributes liquidity gets rewarded with dividends based on their contribution to the pool. You can claim your rewards at any time or reinvest them into staking.

The first step is to buy some SUSHI tokens. You can then go on to create liquidity on the exchange by depositing your SUSHI into a smart contract that pools it with other users’ tokens.

After this, you wait for traders to buy and sell the pooled tokens. When this happens, all of the users who contributed liquidity will get a certain percentage of the dividends

Method 4: Staking

You can also invest in SUSHI by staking your tokens to earn a passive income. Staking is slightly different from yield farming, although it might sometimes be confusing. Yield farming is all about creating liquidity, while staking is just holding.

The main difference is that when you stake your tokens, you are not required to put them into a smart contract.

You simply hold them in a wallet and get rewarded periodically based on the number of tokens you have staked. Liquidity is all about ensuring that there are enough tokens for trading in the market, while staking is about securing the network.

The rewards you get from staking depend on the staking protocol that is being used.

To start staking your SUSHIs, you first need to transfer them to a compatible wallet. The best wallets to use for this are the Trust Wallet and the Ledger Nano S.

You can then go to the Staking Rewards page on the SushiSwap website and select the protocol you want to use. After that, just enter the number of tokens you want to stake and click ‘Stake.’

This is the easiest way to earn passive income without doing trading or yield farming. However, you will need to keep your wallet online to receive rewards. If you are not comfortable leaving it online (which is understandable if you are staking a large amount), then yield farming might be better for you. 

You can also choose a method that combines yield farming and staking. This would be the best option for you if you want to get higher returns without keeping your wallet online all the time.

In summary, investing in SUSHI is easy. You can buy from the exchanges mentioned above or use the SushiSwap DEX to earn dividends. If you want to earn the highest returns, you can invest in SUSHI by doing yield farming or staking.

The choice will depend on your own preferences and risk tolerance. However, if you are new, we recommend that you sign up for eToro first because it is a beginner-friendly exchange where all the features are easy to understand.

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Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

Is SushiSwap (SUSHI) A Good Investment?

That depends on what you want to do with it. If you are looking for a convenient way to invest in all the major cryptocurrencies, then SushiSwap is a good option because it has low fees and supports all the major coins.

If you want a long-term investment, a good method would be to buy from the exchanges and then use yield farming to earn dividends. If you want to get higher returns without any work, then just stake your tokens instead.

All in all, it is clear that SushiSwap has made investing in cryptocurrency easy for both novices and experts alike. You can choose from a variety of options to maximize your profits.

In a nutshell, there are three reasons why we believe SUSHI can be a strong investment.

1. It is an easy way to invest in cryptocurrency.

Keep in mind that you can only earn dividends on SUSHI if you stake your tokens or do yield farming. 

You cannot earn any return from simple buying and selling on the exchange. However, the fees are really cheap, and this might become a great long-term investment option if the project succeeds.

2. The team is working on new features to improve the service.

The team is constantly working on new features and improvements for the exchange. 

This shows that they are serious about their project and that they want to make it the best it can be. So, if you are looking for a good long-term investment, SushiSwap is definitely worth considering.

3. The project has the potential to revolutionize the industry.

Since cryptocurrency exchanges are still fairly new, there is a lot of work that needs to be done before they can become mainstream. SushiSwap might not be perfect, but it has the potential to simplify decentralized exchanges and make them more accessible to the public. 

If it does succeed, then this will undoubtedly change the way we invest in cryptocurrency forever.

In summary, SushiSwap is a new exchange that might have the potential to revolutionize the industry if it succeeds. 

However, investing in it involves some risk because there are still improvements that need to be made before it can be considered a mainstream option. 

That said, if you are looking for an easy way to invest in cryptocurrency and want to get higher returns without any work, then SushiSwap is worth considering.

Don't Miss: Will SushiSwap Make Me Rich In 10 Years?

Conclusion:  So, Should I Buy SUSHI?

As an experienced cryptocurrency investor, you already know that not every crypto is worth buying.

SushiSwap is a new coin that has shown some promise, but it still needs to prove itself before you can consider investing in it.

That said, the exchange looks promising and has the potential to revolutionize the industry.

eToro – Best Platform To Buy SushiSwap

eToro have proven themselves trustworthy within the crypto industry over many years – we recommend you try them out.

Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

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