What is DEX in crypto?
2017 was the great year for crypto , lot of people made millions and bunch of people lost crypto from exchanges / phishing attack /scam etc…
2018 will be the year of de-centralized exchanges. Atleast crypto community believe so… it is likely to happen…
Why the hype ?
There are two types of cryptocurrency exchanges in market today — centralized exchanges and decentralized exchanges.
We know all the centralized exchanges — bittrex, binance, kucoin, gate.io etc..
A decentralized exchange (DEX) is a marketplace for cryptocurrencies or blockchain investments that is totally open sourced. Nobody controls a DEX, instead buyers and sell deal with each other on a one-on-one basis via peer-peer (P25) trading applications.
The biggest advantage to this system is that your funds will be not entrusted to a trading company or other third party.
A centralized exchange operates like a brokerage house, you deposit funds in an account and the exchange makes the trades for you. The advantage to this is that the exchange does all the work, and it is often insured and regulated by authorities.
A popular benefit to these exchanges is that they will take credit or debit card and bank-transfer payments. They may also pay out in fiat currencies like dollars or Euros which many users prefer.
Advantages Of a Decentralized Exchange
A lot of traders like DEXs because they have some serious advantages.
Top advantages of a decentralized exchange includes:
A DEX can be more resistant to hacking than a centralized exchange because account information is not shared with the exchange operator. Instead ,funds might be kept in your account and you will be the only person with access and trading is handled on chain.
Theoretically, governments or regulators cannot shut down a DEX because it is decentralized operating through a wide variety of nodes and there is no centralized server to crack down(atleast it is very hard)
DEX operates all over the cloud through a variety of nodes.
A decentralized exchange can be faster because you make the trades yourself.
Lets check out the players in DEX arena
Kyber/Kyber Network
Kyber is a relatively new decentralized exchange designed for trading and conversion of Bitcoin, Ethereum, and ICOs.
Kyber’s creators hope to make extremely accurate pricing of altcoins possible through a new mechanism called the liquid-weighted price (LWP). The hope is to base the price on liquidity so there will always be money available for trading.
Kyber offers conversions and exchanges of Bitcoin and Ether tokens through the Kyber Network. The purpose of the network is to provide a hedge against inflation and pay anybody with your token. The recipient will accept the token because he or she can use Kyber to instantly convert it into Bitcoin or Ethereum.
OX protocol
OX is one of the most fascinating DEX solutions yet developed because it is not an exchange. Instead, it is supposed to be a protocol for exchange between exchanges, according to cofounder Amir Bandeali.
The hope for OX is to create a mechanism that allows people to move tokens between the many different exchanges that have been created within the Ethereum ecosystem. Ethereum is actually a vast decentralized network in which a wide variety of exchanges and cryptocurrencies are operating.
The problem, which OX is supposed to solve, is that many of those Ethereum-products cannot communicate directly with each other. OX is supposed to serve as an interface that will allow you to move ICOs, Ether, and Ethereum constructs such as smart contracts and Dapps around the Ethereum system.
OX is not a solution designed for everyday users. Instead, it looks like a professional solution designed for Ethereum developers and investors that are buying and selling large amounts of ICO tokens.
OMG dex (Future plan)
OmiseGo is basically south asian company trying to help unbanked to perform transactions , also aims to disrupt many different financial areas: money remittance, digital wallets, crypto-to-fiat conversions, and a DEX that aims to connect to their network. The exact plans of the OMG DEX is still to be determined, but the company has big ambitions in this area with their own DEX.
NEO based exchanges
1. NEX :
NEX is going to be a big projects , creating DEX on NEO/ GAS tokens. NEX ICO expected to start in first week of March 2018. With low supply, token price at 1.00 $ with strong team, expectations are very high.
NEX has lottery system to select ICO participants , they would select 25K applicants and will give 1000$ USD cap to contribute. Long term outlook is very positive.
2. Switcheo Network DEX
Switcheo Network, the NEO based DEX platform with the most advanced capabilities expected to launch in March (white listing in progress)
Switcheo journey begun in Nov’17, team participated and won in the first NEO dApp competition hosted by CoZ.
They are in the final stages of preparation to launch the first NEO DEX in mid March 2018. NEO will also list ERC-20 tokens in the near future.
Advantages of Switcheo :
Security & control of funds
Immediate token listing
Lower fees
Overcome the shortfalls of existing DEXs like UI/UX
Utility of Switcheo tokens:
Switcheo Tokens can be used as payment for a 50% discount on fees on Switcheo Exchange. Tokens used this way are burnt when collected.
Switcheo Tokens will be used as the base token for cross-chain swaps. Exchange fees may be distributed to SWH holders when staking begins.