One key characteristic that sets apart the blockchain industry is the concept of decentralization. It is so important that without it one cannot distinguish blockchains from regular databases. Through decentralization, this technology has become a “trust layer” that enables the peer-to-peer transfer of value without depending on any centralized entity to ensure that transactions are consummated. More importantly, decentralization assures participants that all transactions are immutable, irreversible, and censorship-resistant.
However, the strength of decentralization is only as strong as its weakest link. Venues called “cryptocurrency exchanges” were created to cater to the evergrowing number of digital assets that want to leverage blockchain technology. This allowed crypto holders a common marketplace where they can buy and sell digital assets easily and conveniently. Anyone can participate so long as participants hand over the custody of their cryptocurrencies by depositing them into wallets controlled by these crypto exchanges. However, these exchanges become the weakest links as they become purveyors of centralization.
These exchanges are called Centralized Exchanges (CEX) due to the following characteristics. First, they own and operate the infrastructure where trades are made, this means, they have the sole authority to implement rules and regulations in the trading venue. Second, they hold custody of the customer’s digital assets, in other words, there is a higher concentration of digital assets located in the wallets they possess and control. Third, they control the wallet where these assets are being kept, allowing them to regulate deposits and withdrawals which allows them to impose fees or even suspend access to.
Throughout the years of their existence, these characteristics have brought many cryptocurrency holders great grief. How many times have we seen customers lose access to their digital assets due to CEXs closures? How many times have we seen CEXs lose customer funds from security breaches resulting from their weak and lax security measures? How many times have crypto holders been denied access to their funds for various reasons, which are oftentimes conveniently timed during a bull run or the opposite? Worst, it happens even to the best, well-respected and most influential centralized exchanges.
Users of centralized exchanges will always be at risk of a single point of failure as well as denial of access. This is true for the simple fact that they have to transfer custodianship of their digital assets to a single entity. Nonetheless, these threats paved the way for the creation of another breed of trading venues dubbed as “Decentralized Exchanges” (DEX) which completely aligns with the advantages and benefits of blockchain technology’s greatest attribute— decentralization, enabling true ownership, control, and total freedom. If cryptocurrencies represent the freedom of money then DEXs represent the emancipation of its movement.
Decentralized Exchanges (DEX)
To fully appreciate the immense value of decentralized exchanges let us discuss the differences between these two trading venues. This will enable us to identify key attributes that set DEXs above from their centralized counterparts. Let us begin by comparing how they both handle private keys.
Centralized exchanges (CEX) require users to deposit their digital assets into wallets that the CEXs created for them. These wallets are automatically generated and certain restrictions are imposed on them for their use. One of these restrictions is not allowing users to have access to its private keys. CEX users will just be given a wallet address and tag (if required) and the ability to deposit, withdraw and trade with that address. While there are some valid reasons for this policy the fact remains that they will not be able to gain full control of their wallets and the benefits that it brings for having access to private keys.
On the other hand, Decentralized Exchanges (DEX) require the use of non-custodial wallets. This means you have to already own a wallet address before you can interact with them. The creation of these kinds of wallets entails the securing of private keys that will enable you to restore, import or recover wallet addresses and accounts. Being able to do so already offers great flexibility for the wallet address owners as they can move them across all platforms that support them. Some DEXs even allow direct interaction with accounts or wallet addresses by asking users to input private keys, while not advisable, demonstrates the power of having private keys in your possession.
Aside from being able to recover your wallet address or account in any supported platform, having access to your private keys will allow you to participate in many crypto-related activities that will maximize the benefits of your crypto holdings. These activities take on the form of forked assets, airdrops, and other benefits that are accessible through the use of your private keys. Allocations and rewards for digital assets coming from forks and airdrops in Centralized Exchanges will not be accessible, not until the operators of the centralized exchanges decide to allow users to access them, which most of the time never happens.
DEX offers full custody of Digital Assets
Decentralized Exchanges allow users to take full custody of their assets. The same cannot be said with Centralized Exchanges as the operators of CEX will be the sole authority to determine which assets will be accessible. In fact, if any unsupported digital assets find their way into a CEX wallet address such as those coming from ERC-20, EOS-based Tokens, TRC20 and others, they will remain inaccessible until they are officially supported. If you try to ask the help from the support team they will just handle you by assuring that the assets that are trapped will not be touched and will be accessible once they decide to support it.
Centralized Exchange restricts access to airdrop, forked and unsupported crypto giveaways
Their statement is quite problematic since there no guarantees the unsupported digital asset will ever be supported. Users of decentralized exchanges do not need to deposit their cryptocurrencies. Their cryptocurrencies never leave their wallets not until the moment of the execution of trades. Hence DEXs do not become high-value targets by hackers who are looking for a big payout. On the other hand, the sheer concentration of digital assets inside CEX presents a very attractive target for hackers, becoming a honeypot just waiting to be exploited.
The risk of not having full custody of your digital assets does not only originate from external threats but also from within the exchange itself. In the event, the exchange suddenly decides to close its doors due to whatever reasons often lead to digital assets being trapped in the platform. In addition to this, there have been reports of ** users' accounts being locked due to suspected illicit activities such us suspicion violating anti-money laundering law or anti-terrorism financing**. Most of these are triggered by government agencies and immediately complied with by exchanges to avoid complications with authorities, thereby becoming the judge, jury, and executioner.
No Withdrawal and Deposit Fees
Decentralized Exchanges do not require withdrawal and deposit Fees. Users of Centralized Exchanges are often faced with high withdrawal fees that significantly lower the trader’s mobility to move their assets from one trading venue to another. This robs the trader of the ability to perform arbitrage and to leverage cryptocurrencies’ utility. Arbitrage in DEXs is much faster as there is no need to deposit and withdraw digital assets. Digital Assets are immediately tradeable from the moment the non-custodial wallet is connected and they are added or deducted directly from the wallet when trades are consummated.
Centralized exchanges use one common address for plaforms with a Memo number to differentiate each user's account.
Centralized Exchanges can easily suspend deposits and withdrawals in their exchanges. Most of these are perfectly timed when there is great price volatility in the markets. While this might be a mechanism to quell irrational trading behavior, crypto holders who just want to move their assets become unsuspecting victims who cannot move their own digital assets due to the unilateral decision of CEXs to suspend withdrawals and deposits. It is a prime example of the powerlessness of users on centralized exchanges.
These fees also present a barrier to entry to new participants in the space who are just discovering how to use trading venues. New users typically deposit small amounts of cryptocurrencies for test purposes and see this easily wither away as they move them. They immediately discover how expensive it is to move digital assets outside of the trading venues. This is aggrevated by the waiting time before transfers are approved and released.
On-Chain Matching and Settlements via Smart Contracts
Another key attribute of Decentralized Exchanges is the executions of trades using Smart Contracts. This means the matching and settlement of trades are done on-chain and it is transparent and immutable. DEXs are types of exchanges that fully embraces the advantages of blockchain technology through and through. It espouses transparency, censorship-resistant, inclusivity, and freedom. However, not all Decentralized exchanges are created equal, one DEX stands tall amongst its peers as it creates a one-stop service for users.
High-performance Decentralized Exchange
Newdex is a new kind of Decentralized Exchange that is able to provide unprecedented user experience of decentralized trading, which is only possible with highly scalable blockchain technology. The previous generation decentralized exchanges are not able to do this due to blockchain technological limitations their DEX are based on. The Newdex team chose to build on top of one of the most scalable blockchains known in the industry, EOS and has been continuously improving its DEX adding features after features to bring more value into its ecosystem.
It has become the world’s leading decentralized exchange that features on-chain matching and settlement through the utilization of smart contracts. In simple words, all trading activities done on the exchange are triggered and recorded in the EOS high-performance blockchain achieving a whole new level of trust without the wait and associated cost seen in previous blockchain generations. This makes fast and high-frequency trading not only possible but feasible due to the EOS’ unique transactionless design and resource allocations. More importantly, data in the DEX are transparent and immutable.
Transaction executed on-chain directly from non-custodial wallet
It also features non-custodial trading where users never lose custody of their digital assets, not until the moment the conditions of their trades are met and thereby executed. By doing so the exchange does not attract unwanted attention from hackers looking for their next crypto honeypot to exploit. Since wallets used in Newdex are non-custodial wallets there will never be a point where users can be restricted from access of their own digital assets. Unlike centralized exchanges, Newdex does not ask for the custodianship of tokens. While there are some feature in Newdex that requires locking up of some assets, unlocking them are within the power of users and does not require access to Newdex website.
Zero Deposit and Withdrawal Fees
Additionally, deposits and withdrawals in Newdex are instant and users will never be charged with fees. This allows frictionless trading within its platform and presents a quick way of having access to all available digital assets in the non-custodial wallet that has been linked. Once wallets are linked all cryptocurrencies contained in the wallet will immediately be detected by Newdex for immediate trading. This is a more efficient and cost-effective way of having access to digital assets. CEX requires users to send each of the assets one by one which is not only cumbersome but also costly as users have to spent transfer fees or resources to send them.
Private Keys not required
As an additional layer of security, Newdex decentralized bourse will never ask for the private keys of its users. Instead, users can log in using the widest range of wallets available for EOS, EOS sidechains, and TRON. This is one of the most striking features of Newdex as it essentially supports almost all types of login options for all supported platforms. Desktop wallets, Chrome extension wallets, and mobile wallets can be used to login to its DEX without having to ask the users to reveal their private keys. This highlights Newdex’s emphasis on security, privacy, and ease of use.
Newdex has become the quintessential DEX in EOS space becoming the go-to listing partner of many EOS-based projects and has been supported by virtually every wallet service provider that supports EOS. This demonstrates the market penetration of Newdex and the reputation it has gained throughout its existence. Its presence and market influence is the direct result of providing the first truly global decentralized exchange based on EOS and continuously building on its brand by providing high quality, relevant and timely products, and services.
NDX Newdex Platform Ecological Token (NDX)
Newdex issued its own utility token dubbed as the Newdex platform Ecological Token (NDX). Its primary purpose is to serve as the platform’s primary currency for services its offers. These include VIP membership Fee, repurchase and destruction, staking concessions, Token airdrops, advertising bidding, independent listing and more. It is currently listed in Newdex with pairs of NDX/EOS and NDX/USDT. Recently it has been used to rewards those who opted to undergo identity verification for OTC services of the Newdex Platform.
Newdex Free CPU trades for VIP members
Newdex has been built on top of one of the most scalable and feature-filled blockchains in the entire cryptocurrency ecosystem. To elevate the trading experience of its users further, Newdex is giving its users limited Free CPU placing order in trades depending on their VIP levels. The CPU-free placing order time as shown below:
This would allow its traders to execute trades without having to worry on having enough CPU-time EOS resources.
Newdex is designed to be a frictionless and borderless decentralized exchange, as such, it offers multilingual support to cover all the most active crypto trading jurisdiction in the world. Currently, it supports English, Korean, Chinese and the Japanese language. It is expected that more languages will be supported in the future as Newdex expands to new markets.
Simple yet Power User Interface (UI)
One of the first things users will notice about Newdex is its simple yet powerful user interface (UI) that enables them to gain access to all important features easily and conveniently. Its design is clean and purposeful without excess information clottering the screen enabling users to concentrate on what they are doing. The additional features of the DEX are carefully tucked away but easily accessible through the many non-intrusive menus buttons smartly positioned for optimal use. Hidden behind this elegant UI is a new breed of decentralized exchange that truly raises the bar of excellence in Decentralized Finance (DEFI) particularly the DEX sector.
Multi-Chain and Cross-Chain Trading
Excellent Tech support
To give the very best tech support to its users, Newdex has hired the services of Zendesk, a software company that is headquartered in San Francisco and listed on the New York Stock Exchange. The support page is very well organized and response times are top-notch. Nothing less is be expected from a professional tech support team. The same company is also used by many well-established blockchain-based companies who want professional-level services for its tech support.
Highly ranked among dApps Trading Platforms
It comes to no surprise that Newdex has consistently ranked on top of dApps data services providers, such as the Dappradar, in terms of the trading volume. This makes them the top EOS-based DEX in the space. This is just a confirmation of what we already knew about Newdex and about its team who tirelessly seek out new innovative products and services with the purpose of bringing to the crypto trading community the very best of what DEX trading has to offer. But wait there is more! Its newest innovation is explained in the next section where it tries to marry traditional and blockchain-based fintech together.
Introduction of Newdex Over-the-Counter (OTC) service
OTC market bigger than Spot Markets
Pundits have always claimed that Over-the-Counter (OTC) markets are several times bigger than Spot markets. Spot markets are those trading venues that we see on crypto data services providers like Coinmarketcap or Coingecko. Due to the lack of information about this matter, there is no way of confirming this claim but looking closely at the current market environment there might be some truth into this. In fact, back in 2018 Bloomberg has estimated that the OTC’s daily trading volume is several times bigger than those seen on regular exchanges.
Factors why it might be True
There are essentially three factors we can consider that might prove this. First, a number of jurisdictions have restricted trading venues due to a lack of regulatory measures. Let’s take for example Russia, China, India, and Venezuela. A lot of the citizens in these countries are highly interested in bitcoin and cryptocurrencies but lack the trading venues where they can trade. They have turned to OTC trading to work around these restrictions.
Take note that China’s and India’s population alone accounts for 36% of the world’s total population. Russia, on the other hand, has been looking for ways to lessen the influence of the US dollar looking at many alternatives including cryptos. Similarly, Venezuelan citizens have turned to crypto as a store of value and medium of exchange due to the extreme inflation rate their country is experiencing as a result of the economic sanctions imposed by the U.S government and its allies.
Second, most institutional investors use OTC markets to buy and sell cryptocurrencies. The lack of liquidity in Spot Markets cannot accommodate the big trades of institutional investors without significantly influencing the market prices of spot markets. Because of this many chose to transact through OTC services which more often than not have block trades which do not pass through order books of exchanges which might influence the price action of the underlying asset. Going through an OTC is a better option especially when price volatility is a major factor in the trade.
Finally, almost all major exchanges are now trying to get into the OTC market. It also presents a great intersection between traditional finance and blockchain-based fintech where it can serve as an effective fiat onramp as well as getting new users into space. For Newdex it presents a whole new target market that might be the right venue where it can onboard new participants in the crypto ecosystem.
How to Join the Newdex OTC marketplace?
Regulatory compliance requires the Newdex team to ask its users to accomplish KYC and AML procedures before they can avail of the OTC services. Prospective users are required to declare their identity, contact information and to submit proof to validate the information submitted. Once this information has been approved users can start using the OTC market.
While the Newdex team values the privacy of its customers they also acknowledge the need for such procedures for the safety of its users since the service entails interaction with government-issued assets (fiat) as well as to be able to resolve disputes when the need arises. Currently, the platform only offers Renminbi or the Chinese Yuan CNY for fiat purchases and has expressed the intention to expand to other fiat options in the near future.
As a way to celebrate the launch of their OTC services and to rewards participates who undergo KYC procedures the Newdex Team have initiated the Newdex OTC NDX Rewards Program. Users who will participate in Identity Verification Procedures will receive NDX. The program started November 25, 2019, and will end at 9:00 am Decemver 16, 2019 (UTC).
There are two activities where users can join and they are allowed to join both so long as they qualify. Rewards are limited and will be distributed based on a first come first serve basis. Since the rewards program is sponsored by Newdex, their final interpretation of the results of the rewards program are final and cannot be reconsidered.
The first activity (Activity 1) is the real name verification. The total rewards for this activity is 2,500 NDX
During the activity, users who log in to Newdex and complete the real name verification on the OTC fiat trading page can claim NDX reward:
- Reward 500 NDX via completing the primary verification (3,000 openings).
- Reward 2,000 NDX via completing the intermediate verification (3,000 openings).
The second activity (Activity 2) is the fiat trading which has a total reward of 2,200 NDX
During the activity, users who log in to Newdex and complete EOS or USDT trading on the OTC fiat trading page can claim NDX reward:
- One time reward of 200 NDX for a single order ≥ 50 EOS/150 USDT
- One time reward of 2,000 NDX for a single order ≥ 500 EOS/1500 USDT
Newdex’s One-Stop Service
Newdex has proven once again why it is the leading high-performance decentralized exchange in the space:
Providing scalable decentralized exchange trading
- Instant and Secure
- On-Chain matching and Settlement
- Transparent and Immutable
- No Deposits and Withdrawals Fees
Top-rated trading dApps
- Highest trading volumes
- Most supported DEX by top wallet service providers
Offering the widest range of EOS-based tokens
- EOS Native Tokens
- EOS Sidechains
Multichain and Cross-chain Trading
- Added Support to Tron-based Tokens
- Plans to support other high-performance blockchains
Providing innovative opportunities for its users
- Newpool multichain staking pool
- Widest range of EOS-based Stablecoins offering
- OTC trading desk for fiat trading
The diverse and extensive product/service offerings from Newdex have truly created a One-Stop Service where users can enjoy the fullest benefit of their digital assets as well as opening the floodgates of OTC fiat trading. With this new service, it has empowered its users the flexibility to conduct trades with both blockchain-based and fiat assets.