SushiSwap V3 Liquidity Management

🧭 Executive Summary

A production-grade TypeScript application showcasing advanced DeFi protocol engineering through direct interaction with SushiSwap V3 (Uniswap V3 fork) on Ethereum Sepolia. This project demonstrates expertise in smart contract integration, liquidity management, and automated DeFi operations, designed with modular, testable, and gas-efficient architecture.

GitHub: danielrc888/sushiswap-v3-liquidity-management

⚙️ Technical Overview

Core Technologies

Language: TypeScript 5.5.4
Blockchain Library: ethers.js v6.13.4
DeFi SDKs: @uniswap/v3-sdk, @uniswap/sdk-core
Network: Ethereum Sepolia Testnet
Protocol: SushiSwap V3
Node Version: 22.11.0

Architecture Highlights

Modular Codebase:

blockchain/ – RPC connections, provider/wallet configuration
scripts/ – Executable handlers for liquidity and swap operations

Smart Contract Integrations:

Nonfungible Position Manager: 0x544bA588efD839d2692Fc31EA991cD39993c135F
V3 Pool Factory: 0x1f2FCf1d036b375b384012e61D3AA33F8C256bbE
Swap Router: 0x93c31c9C729A249b2877F7699e178F4720407733

💧 Key Functionalities

1. Liquidity Pool Management

Deploy and initialize V3 pools using the Factory pattern
Support for arbitrary token pairs (e.g., USDC/WETH)
Configurable fee tiers and sqrtPriceX96 initialization 📄 Refs: createPoolV3.ts, initializePoolV3.ts

2. Concentrated Liquidity Positions

Implements Uniswap V3 concentrated liquidity mechanics
Auto-calculated ticks via nearestUsableTick()
Optimized range selection and multi-token liquidity provision 📄 Refs: createLiquidityPosition.ts, commons.ts:46–63

3. Dynamic Position Management

Add Liquidity: Incremental position scaling with EIP-1559 gas efficiency
Remove Liquidity: Partial/full withdrawals + automatic fee collection
Collect Fees: Claim all accrued rewards via multicall batching 📄 Refs: addLiquidityToPosition.ts, removeLiquidityToPosition.ts, collectFeesFromPosition.ts

4. Token Swap Execution

Single-hop swaps via exactInputSingle router method
Slippage tolerance and deadline protection 📄 Ref: swapTokensPoolV3.ts

5. Position Monitoring & Analytics

Fetch all NFT-based positions for an address
Track real-time liquidity, fees, and tick states 📄 Ref: monitorPositions.ts

6. Token Approval Workflow

Automated ERC-20 approval for router and position manager
Batch approval optimization for multi-token operations 📄 Ref: approveTokens.ts

🧠 Technical Achievements

Blockchain Engineering

Direct ABI-based contract interactions via ethers.js
Gas-efficient transactions using EIP-1559
Transaction validation and retry logic
Concurrent blockchain queries with async/await

DeFi Protocol Expertise

In-depth understanding of Uniswap V3 math (ticks, sqrtPrice, liquidity depth)
Handling ERC-721 Position NFTs and fee growth accumulators
Slippage-protected swaps and multicall execution

Software Engineering Practices

Strong TypeScript typing and strict mode enforcement
Secure environment management (.env, private key isolation)
Reusable helper functions and layered architecture
Clear separation of concerns (connection / commons / scripts)

🧩 Demonstrated Skills

🧱 Project Structure

sushiswap-v3-liquidity-management/
├── src/
│   ├── blockchain/
│   │   ├── commons.ts
│   │   └── connection.ts
│   └── scripts/
│       ├── approveTokens.ts
│       ├── createPoolV3.ts
│       ├── initializePoolV3.ts
│       ├── createLiquidityPosition.ts
│       ├── addLiquidityToPosition.ts
│       ├── removeLiquidityToPosition.ts
│       ├── collectFeesFromPosition.ts
│       ├── swapTokensPoolV3.ts
│       └── monitorPositions.ts
├── package.json
├── tsconfig.json
└── README.md

🌐 Testnet Deployment

Network: Sepolia (Chain ID: 11155111) Token Pair:

USDC → 0x3a21C919cE86e6e11F318638e582d36361a93C54
WETH → 0xc66d55434782B02ebb4Baf8Dc559c7b95bB035D5

Deployed Pool: 0x3Ecc8cFC6253378fd93E7Ff76d0938649AaDd485

Deployer Address: 0x87B06f8ecAeE3378a414aaD45Aa08F8a18003FD4

Example Transactions:

Pool Creation → 0x5e7133...7a3675c
Position Creation → 0xc79fd5...ac994
Token Swap → 0x3c4533...659d42e

🧰 Setup & Usage

# Clone and install
git clone https://github.com/danielrc888/sushiswap-v3-liquidity-management.git
cd sushiswap-v3-liquidity-management
npm install

Configuration

# .env file
RPC_URL=https://sepolia.infura.io/v3/YOUR_KEY
WALLET_PRIVATE_KEY=your_private_key_here

Run Workflow

npm run build
node dist/scripts/<script_name>.js

Example sequence:

createPoolV3.js → Deploy pool
initializePoolV3.js → Set price
approveTokens.js → Approve tokens
createLiquidityPosition.js → Provide liquidity
monitorPositions.js → Track stats
swapTokensPoolV3.js → Swap & generate fees
collectFeesFromPosition.js → Claim rewards

🚀 Real-World Applications

DEX development & DeFi protocol prototyping
Liquidity & portfolio management tools
Automated market-making and trading bots
On-chain analytics dashboards
Security research & smart contract audits

🔭 Future Enhancements

Multi-chain deployment (Polygon, Arbitrum, Optimism)
Range/limit order strategies and auto-rebalancing
Impermanent loss visualization
Integration with price oracles
Frontend dashboard (React/Next.js)
Continuous gas profiling and performance metrics

🎯 Summary

This project demonstrates end-to-end DeFi development expertise — from protocol design to transaction execution — built with strong software engineering practices and real-world deployment on Ethereum testnet. It highlights hands-on experience with AMM design, gas optimization, liquidity algorithms, and decentralized finance mechanics — key capabilities for any Web3 infrastructure or protocol engineering role.

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Last updated 1 month ago