AuroraDAO (AURA): Undervalued?
Think of Aurora as a platform that has big plans for providing a decentralized banking experience.
Right now looking at their website there is a whole lot of different names being thrown around like Aurora DAO, IDEX, Boreal, and Snowglobe.
For the time being and for the purposes of this video, I’ll be focusing on Aurora and IDEX.
Today, right now, we can use Aurora’s decentralized exchange called IDEX. This dex is similar to EtherDelta in that you can trade any ERC20 token on the exchange, and you access this exchange via a website: https://idex.market.
Before I go on to speak about Aurora and IDEX, I would be remiss if I didn’t point out how a similar exchange called EtherDelta fell victim to a centralized weak point: it’s web hosting service.
In order to access EtherDelta you needed to use it’s website. This particular website and how it was hosted served to be a target for hackers. And that’s exactly what happened. A hacker took control of the domain and people wanting to use EtherDelta despite being warned of it’s compromised condition continued to import their private keys, right into the hands of the hacker.
That is why it’s hard for me to call IDEX a completely decentralized exchange at this point, but from what I understand from talks with individuals involved with this project, they are aware of the weaknesses and threat of censorship that centralization brings and are working towards resolving these issues as time moves on.
Speaking of finding the right balance between the security of decentralization and the convenience and ease of use that comes with centralization, let’s take a look at how IDEX is tackling it.
Right off the bat, we see this with how the trades are broadcast to the Ethereum blockchain.
Unlike other exchanges based on Ethereum, IDEX matches trades off-chain and then uses an arbiter to broadcast the trades onto the blockchain in groups based on the time that the trade occurred. While other Ethereum dex’s are exposed to slow trade times due to the reliance of the miners to match the trades, the IDEX arbiter works to consolidate the trades and broadcast them in a way that allows for real-time trades and the ability to immediately cancel trades without having to pay gas fees.
Users of IDEX are required to sign each trade with their private key, if you’re using your ledger wallet, this is done by you confirming the transaction on your device.
This acts to prevent any user from backing out of a completed trade, it also prevents IDEX from conducting unauthorized trades as well.
The downside to this one is that you’ll be paying higher gas fees to make trades and the deposit, trade and withdrawal minimums can be a bit high for those who are new to trading.
If you’re interested in learning more about how to actually use this exchange I’ve made a few videos that guide you through the whole process so be sure to check out those links down below.
Ok, moving on now to take a look at how you can stake Aurora’s coin, called Aura.
You can’t stake it just yet, but in the future you will be able to and the according to the FAQ section of https://auroadao.com, rewards will be designed as follows:
“Market makers who place and execute limit orders on any IDEX market are eligible to receive AURA token grants. 20% of the total AURA token supply will be dedicated to this Market Maker rewards program. AURA in the program will be granted at a rate of 1% of the total remaining Market Maker rewards AURA per month, i.e. 0.2% of the total AURA supply, or 2 million AURA, will be distributed in the first month. With each additional month, the absolute number of AURA rewards will be slightly reduced, providing an incentive for market makers to join early and ensuring that the rewards program can continue indefinitely.
Traders receive AURA proportional to the fees they spend on their limit orders. For example, if three traders trade during a one month period with trader A paying 5 eth in fees, trader B paying 2 eth in fees and trader C paying 3 eth in fees, they will receive 50%, 20% and 30% of the total distributed that month respectively. The earned amounts can be augmented by up to 2x by owning membership tokens.”
These membership tokens have the ticker symbol IDXM and at the time of this post one IDXM is priced at $2,148.
They entitle the holder to free or discounted trades on IDEX until the year 2021 and double market making rewards for life. Keep in mind that you can only use one of these benefits per trade.
I did find one interesting article that had something to say about the valuation of this particular coin, Aura, I’ll of course include a link to it down below.
It’s basically saying that based on the profits earned in IDEX’s first 6 months of trading, if the staking mechanism had been put in place from the start, there would have been over $2.6 million in Aura distributed to the stakers. So if you’ve been looking for a good staking option where you can get in early, this one could be worth checking out.
Aurora Website: https://auroradao.com/
IDEX explanation by Alex Wearn: https://medium.com/aurora-dao/introducing-idex-61af097b48ad
Aenigma Capital's valuation of AURA: https://bitcoinmagazine.com/articles/fueling-decentralized-crypto-investments-aenigma/
Aurora DAO FAQ: https://auroradao.com/faq/
Aurora DAO Twitter: https://twitter.com/aurora_dao
Aurora DAO Medium: https://medium.com/aurora-dao
How to Trade on IDEX:
Connect to IDEX with a ledger: