Trading without intermediaries, or what good is a decentralized cryptocurrency exchange.

in cryptocurrency •  2 years ago 

The cryptocurrency market is growing rapidly, and during its existence some assets has risen in price by hundreds and even thousands of times, becoming an attractive target for investment. It would seem that can be simpler: you want to make money — buy a cryptocurrency, wait until it is many times more expensive and grab a lot of money!

It would be a good solution, if not for the high volatility — pride and prejudice cryptocurrency market.

On the one hand, it is the source of dizzying profits. With another high-risk factor, after all, is to miss the point, and because of the sharp drop in prices, you can not only lose potential profit, but and attachments. So we have to act quickly and carefully. For example, trading on the exchange. And successful trading platform choice plays in the success of a significant role.

Centralized exchanges — an imperfect classic
Over the past few years, many exchanges and each one has than to attract investors. Which is better interface or more currency pairs, but somewhere cooler functionality or more serious security.

All, without exception, have a common drawback: the operating principle of centralized exchanges negates many of the benefits of the blockchain technology. In fact, by accessing this site, the investor transfers its assets to a third party, that is, loses on them sole control.

There are other inconveniences:

A large influx of users often leads to overload of the system and attracted to the centralized exchanges the attention of hackers.
There is a risk that the exchange will intervene public authorities and block the account.
If there is a dispute, the withdrawal of assets may be delayed in time.
Conducting stock exchange activity at your own risk, the investor, however, pays the exchange and the exchanger impressive commissions.

What if differently?
All of the above is a serious reason to search for alternatives. It can be a decentralized exchange, where:

Transactions occur under the control of a smart contract directly between the parties.
Minimal risk of hacker attacks, because the funds are not stored on the exchange.
No intermediaries, control, and censorship, no one can block the account or freezing the funds.
Decentralized exchange is increasingly attracting the attention of those who work with digital assets.

"Working through centralized exchanges, customers can't fully control your assets and actually operate only symbols, which the exchange will display on their accounts. I think decentralized exchange is a new stage of development of the digital economy. The funds remain under the control of the owner, increasing the level of safety, as well as increasing the credibility of the trading process digital assets and industry as a whole", — says Andrey, Tonalita, founder of the investment Fund Crypto Art.

In the list of revolutionary cryptocurrency exchange business especially loud sounds the name of the BitShares platform, on which many months operate successfully OpenLedger and Russian exchange RuDEX.

But there are many titles that are still being discussed, not so much.

We offer you a small overview of the upcoming launch and current decentralized cryptocurrency exchanges and platforms:

0x Project
This decentralized platform designed to trade tokens and assets, which are based on Ethereum. The application uses an open Protocol 0x and provides a simple and quick exchange of tokens of the format ERC20. All operations are carried out under the control of smart contracts Ethereum.

In August 2017 0x Project has attracted during ICO $24 million About good prospects of the project, says the support of the international investment authority: Blockchain Capital, Pantera Capital, Jen Capital Advisors and Polychain.

Internal token of the project (ZRX) is designed to:

Payment of a fee to exchangers working for Protocol 0x.
Use as a "voting token" and control the update process of the Protocol.
Technical features:

Developers consider Protocol 0x as the basis for creating other DEX-based applications.
Protocol 0x is already integrated into services such as ChronoBank, Augur, dharma, Melonport, Aragon, ANX, and others.
Benefits for users:

The use of the Protocol 0x does not provide for payment in addition to the standard rewards to miners.
The owners of the tokens have a voice in addressing issues of update Protocol.
The ability to make transactions with tokens of the format ERC20 without intermediaries and control.
The current decentralized market, working on smart contract Ethereum. The site started in the middle of summer 2017, and by December, the daily trading volume approached $8 million.


Unlike other similar projects, the platform was wholly funded by developers and put into operation without phase ICO. The team is headed by Zack Coburn, known for his work in eSports project FirstBlood.

Benefits for users:

For transactions no need to enter the assets in the stock market, they are integrated into a smart contract so that to trade them could only owner.
The service retains a small Commission in the amount of 0,3% of each transaction, and this is the only source of income EtherDelta.

Kyber Network
The developers of this decentralized exchange promise instant transactions on the trade and exchange cryptocurrency. Transactions are controlled by the smart contract. MVP Kyber Network was launched on Testnet in August 2017, and a full launch of the platform scheduled for the first quarter of 2018.

High interest in the project was probably due to the fact that the adviser acts as acne Buterin.


The creators of the startup special emphasis on the presence of the "warranty" provision of the tools provided by third-party representatives to confirm the liquidity of the token project (KNC).

The purpose of the token KNC:

Token KNC used as remuneration to the guarantors, creating a reserve for the exchange.
Part of the profits from the operation of the exchange will be withdrawn from circulation, i.e. "burned". This will help to regulate the circulation of the token and will create the potential to increase their value.
Benefits for users:

Guaranteed liquidity of the token.
Instant execution of transactions.
Versatility: the exchange operates directly with any tokens, so there is no need of conversion.
The creators of this p2p exchange has set itself the task to improve the mechanisms blockchain economy. The platform is designed to provide security, speed and privacy trading digital currencies. Exchange operates on the Swap Protocol and is intended for the exchange of tokens of the standard ERC20.

Tocancel was launched on 10 October 2017. One of the advisors of the project is Ethereum co-founder Joseph Lubin.

Features and benefits for users:

The main difference site — no fee for both sides of the transaction.

The purpose of the token project AST:

Guarantee of use of the platform. For the work necessary to reserve a fixed number of tokens for the week. Initially this limit is equal to 100 AST.

According to the developers, OmegaOne created to make cryptocurrency trading more stable, simple and safe.

The beginning of the presale is still to be announced.


Probably, many remember the system crashing, fixed in Ethereum 21 June 2017. Then the rapid launch of ICO Status has led to a "freeze" on the order of 500,000 ETH in unconfirmed transactions. As a result, most exchanges have blocked withdrawals ETH almost a day, users could not commit transaction, not even related to ICO Status.

OmegaOne is designed to protect its users from such failures: the system "splits" a great deal on a set of fragments distributed over short periods of time.
The platform also protects funds in the wallets of users for the entire period of the transaction. This provides additional protection from hacker attacks.
The purpose of tokens:

Tokens platform will provide access to trading and used to pay the fee.

Benefits for users:

Asset protection for the period of the transaction.
Find the best prices for the transaction and conduct the auction on behalf of the investor by using a learning algorithm.
A higher pool of liquidity than other exchanges.
What are the prospects?
We can say that cryptome is on the threshold of a new exchange format. Thanks to smart contracts, decentralized exchanges are faster and safer than centralized. Equally important factors — the lack of external influence and low Commission for transactions.

More cryptocurrency projects are launching their own decentralized platform. Thus, on 14 December 2017, the company Waves has launched a beta version of the client module with high performance, powerful functions and easy interface, and a week — a new algorithm for consensus Waves-NG. The developers are confident that after that the Waves will be the most "popular" decentralized platform — fast, reliable and easy to use.

According to analysts, there is every reason to predict that in the near future, the number of decentralized kryptomere will increase, and their functionality will expand.

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Came across this whilst researching Kyber, good article :)