In our previous post, we took a closer look at the concept of Automated Market Makers (AMMs), how they work, and why they are of such importance for the whole DeFi landscape.
In today’s post, we will take a moment to explore some of the most influential Decentralized Exchanges (DEXs) within the entire DeFi Ecosystem and explore some of the features that make each one of them unique and suited for different users.
With the rise of DeFi, DEXs are becoming unavoidable for most cryptocurrency users, so, throughout this post, we’ll dive deeper into the world of DeFi protocols and everything they bring to the table.
Founded in 2017 by Antonio Juliano, an ex-Uber and Coinbase engineer, this Ethereum-based decentralized platform offers lending, borrowing, and betting tools to its users. Currently, dYdX stands as the most popular decentralized margin trading platform with a total of $773.8M locked in smart contracts.
Much like other similar DeFi Exchanges, dYdX is an open-source platform that smart contracts manage users’ assets. However, dYdX introduced margin trading, options, and derivatives features — that were already common in traditional exchanges — in the context of trustless, decentralized trading.
At the moment, dYdX uses a hybrid infrastructure model that uses non-custodial, on-chain settlement, and an off-chain low-latency matching engine with order books, which translates into an institutional-grade, liquid, low slippage trading, unlike AMM platforms.
During the first few years of existence, dYdX remained a fairly unknown platform, even though it is backed by well-known entities in Crypto, such as Coinbase co-founder and CEO Brian Armstrong, Three Arrows Capital, or Andreessen Horowitz.
This period of less weight in the industry may be tied to the fact that, until recently, the platform lacked a governance token or incentives program, something that similar platforms were offering. Earlier this year, this has changed with the launch of the dYdX token.
Since its launch in September 2020, PancakeSwap has taken the crypto world by storm and kept growing at an impressive rate to become, by far, the biggest DEX on Binance Smart Chain.
With a very distinct visual approach and a somewhat humorous name, PancakeSwap rapidly grabbed users’ attention. Still, it did not take long until everybody understood that the platform was attracting very serious liquidity and daily trading volume numbers.
Designed to enable secure trading between Binance Coin (BNB) and a vast diversity of BEP-20 Tokens while allowing users to keep control of their private keys and eliminating the need for centralized services, PancakeSwap executes all trades through intelligent contracts.
The developers behind the DEX remain anonymous, but PancakeSwap has been audited by various leading blockchain security firms such as Certik, and it is entirely open-source.
Being an Automated Market Maker (AMM), PancakeSwap works without order bids, limit/market orders, or a bid/ask system. Instead, users draw liquidity from the platform’s liquidity pools.
A protocol launched on the 31st of August of 2020 as one of the first major open-source projects built in the Solana Ecosystem. It is supported by the Serum Foundation and backed by a group of cryptocurrency trading and DeFi experts that includes FTX, the Solana Foundation, and Alameda Research.
Serum shares its liquidity and price-time-priority matching with Ecosystem partners (like Raydium), allowing users to benefit from this model by choosing the size, direction, and price of their trades. At the same time, partner projects benefit from Serum’s liquidity and matching service.
Launched in the Solana Ecosystem, Serum’s aim was to offer an alternative for Ethereum’s limitations in a fully decentralized platform, lower fees, and better transaction times. SRM is the utility and governance token of the Serum ecosystem, and it will be fully integrated into Serum to benefit from buy/burn of fees.
Built on the Solana Blockchain, Raydium is an AMM that uses the central order book from the Serum Decentralized Exchange (DEX) to give its users the ability to take advantage of Solana-enabled super-fast trades and low fees.
Launched in February 2021, Raydium deviates from other AMM DEXs and DeFi protocols because, unlike its peers, this platform uses shared liquidity as it accesses the order flow and liquidity from the entire system Serum ecosystem (and vice-versa).
With up to 65,000 transactions per second and average transaction fees of $0.01, Solana constitutes a preferred environment for the creation of DEXs, especially when contrasted to their counterparties on Ethereum, and Raydium takes full advantage of this efficient environment.
About Solanax
Solanax is a Solana-based automated market maker (AMM) exchange providing lightning-fast trades, pooled liquidity, and other income-generating features. Solana was chosen as the underlying blockchain to facilitate low-cost, high-speed transactions. It is a permissionless, high-performance blockchain based on the Proof of History consensus (PoH).
Given the advantages that Solana offers when compared to other blockchain ecosystems, it is a popular solution among investors, users, and developers. Ethereum’s Proof of Work Consensus is slow, hard to scale, and comes with high gas fees which were exacerbated by its account-based system. Where Ethereum has failed to live up to the community expe, Solana quickly proves to be a viable alternative.
Solanax will utilize the cross-bridge Wormhole to connect to projects and digital assets existing on the Ethereum blockchain, facilitating adoption and allowing the crypto community to seamlessly move tokenized assets from one blockchain to another, improving interoperability and liquidity setup.
It is faster and cheaper; Solanax offers on-chain liquidity; traders will have more control over their trading activities; an integration of Wormhole for fusion with tokenized assets on the Ethereum blockchain, and much more.
For more details on the project at the forefront of the DeFi evolution, visit:
Website | Twitter | Telegram | White paper
