Bitcoin-native RunesDex to Launch AMM with Arch

Arch Network

14 Jan 2025 • 2 min read

RunesDEX, a pioneering decentralized exchange, is partnering with Arch to directly bring automated market making (AMM) to Bitcoin's Runes ecosystem.

AMMs solve a fundamental challenge in decentralized trading by replacing traditional order books with liquidity pools. Rather than waiting to match buyers with sellers, users can trade instantly against these pools, with prices determined algorithmically based on supply and demand. This constant availability of liquidity is what makes complex DeFi applications possible.

AMMs are the foundation that other DeFi protocols build upon. Lending platforms need deep liquidity to offer competitive rates. Options protocols require reliable price discovery. Even simple stablecoin transfers depend on efficient trading pairs.

By bringing AMM functionality to Bitcoin's base layer, RunesDEX enables trading and working alongside other decentralized exchanges on Arch to lay the groundwork for the entire Bitcoin DeFi ecosystem.

"The future of Bitcoin DeFi depends on having reliable, programmatic access to liquidity," says Viktor Ihnatiuk, Core Contributor to RunesDEX. "Arch's architecture makes it possible to enrich sophisticated AMMs like RunesDex directly on Bitcoin, making it faster and easier than ever to unlock the massive liquidity of the base layer."

Key innovations include:

Constant product AMM enabling easy swaps between BTC and Runes
Permissionless liquidity pools that anyone can create and stake in any Rune/BRC-20
Two-way fee structure with 80% to liquidity providers and 20% to treasury
Optimized UTXO management for efficient trading
Support for both Runes and BRC-20 tokens

By combining Arch's bridgeless execution with RunesDEX's AMM model, Bitcoin users can now access the same sophisticated trading capabilities that drove DeFi's explosive growth on other chains – but without ever having to bridge their assets away from the security of the base layer.

"AMMs are the building blocks of DeFi," Ihnatiuk says. "By bringing AMM functionality directly to Bitcoin supported by Arch's execution platform, we're creating the foundation for an entirely new financial system built on the world's most secure blockchain."

RunesDEX also recently launched a Liquidity Provider Program in which ~3.5% of their upcoming TGE will be distributed annually as liquidity incentive rewards.

Users earn points for the first two months in place of tokens, which are eligible for an airdrop at the token generation event (TGE). Rewards are distributed across multiple pools according to a linear weighted average model that considers both Total Value Locked (TVL) and trading volume. Within each pool, liquidity providers (LPs) receive rewards proportional to their share of the pool's liquidity. To earn rewards, LPs should maintain their liquidity position until RunesDex releases their points reward system later this month.

Users can now start trading Runes and providing liquidity directly through their Bitcoin wallets at RunesDEX.com, with more innovative DeFi applications made possible with Arch integration in the coming weeks.

Want to build on Arch?

About Arch Network

Arch Network is a bridgeless execution platform designed to enhance Bitcoin's capabilities by enabling fast, secure, and fully verifiable smart contract-like programs. Its bridgeless architecture facilitates role-dependent trust assumptions, including fully trustless use cases on the Bitcoin base layer. With its specialized VM and Decentralized Verifier Network, Arch is helping unlock the full liquidity and programmability of Bitcoin.

About RunesDEX

RunesDEX is a pioneering decentralized exchange (DEX) that facilitates seamless trading and liquidity for Runes and Bitcoin-based assets. Focusing on UI/UX and accessibility, RunesDEX is committed to building a thriving ecosystem that bridges the gap between traditional finance and decentralized networks built on Bitcoin.

Learn more about RunesDEX: