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Centralized cryptocurrency exchanges have been around for nearly as long as cryptocurrencies themselves, and over the years, they have perfected their services. They are still improving, of course, seeking ways to accommodate greater numbers of traders, add new features, new products, and more, but for the most part, crypto trading on their platforms is pretty much as good as it is going to get.
For decentralized exchanges, however, the situation is different. While they have been around for years now, for a good portion of their lifetime, they were not capable of satisfying their users’ needs due to the lack of liquidity. This even led many to assume that DEXes would never take off, as they simply cannot attract users with no liquidity, while they can’t get liquidity without users.
Things changed in 2020 when Uniswap invented the automated market maker (AMM) model, and suddenly, DEXes throughout the crypto industry have been adopting this method. Suddenly, decentralized exchanges blew up, but even so, on their own, they were no match for CEXes. Now, however, IDEX changed that by becoming the first hybrid liquidity DEX.
What Problems Does IDEX (IDEX) Solve?
IDEX is a revolutionary decentralized exchange that currently runs on Ethereum and BSC. Let’s take a look at some of the solutions that it brought to the decentralized finance sector.
The first hybrid liquidity DEX
As mentioned, IDEX is the first hybrid liquidity DEX, which means that it combines the automated market maker of DEXes with the order book model that centralized exchanges are using. As a result, it blends the performance and features of CEXes with the decentralization, security, and liquidity of an AMM. The result is the new model of DEXes that might become a standard for future decentralized trading platforms.
Combines an off-chain trading engine with on-chain trade settlements
IDEX takes an innovative approach to run a DEX by combining an off-chain trading engine with an on-chain trade settlement. This ensures a number of benefits, such as faster settlements but without overloading the chain.
As mentioned, IDEX already runs on Ethereum and Binance Smart Chain, with plans to launch on second-layer solutions and Polkadot in the future. The timeline for additional expansions was not offered yet, but IDEX has been rather open with the intention to expand, so we know that it is coming at some point in the future.
Benefits of IDEX (IDEX)
Next, let’s discuss the benefits that IDEX can offer to its users. There are several that come as a direct consequence of its solutions, such as:
Execute more advanced order types
Thanks to the fact that IDEX can offer instant trade executions, the project can also offer more advanced order types and trading strategies for its users. This is possible since instant trade executions open the door for things like limit orders, arbitrage opportunities with other exchanges, and alike.
Plans to add leverage trading
Another important detail about IDEX is that it plans to continue improving its service by adding new services and features. For example, the exchange said that it plans to add trading with leverage at some point.
Eliminates unnecessary network costs
IDEX takes a rather unique approach to combining an AMM with an order book model, as mentioned, and it uses an off-chain trading engine that matches the performance of CEXes and guarantees sequencing. Trades are then processed in an off-chain order book, and so only when a trade is matched and fully executed does the transaction get settled on the blockchain. This means that users do not have to pay extra costs for placing and canceling orders, as all of that takes place off-chain.
Finally, it is also important to note that the automated market maker guarantees liquidity by displaying virtual limit orders in its order book, alongside real limit orders. This visualizes AMM liquidity in the order book model, and orders get settled as AMM-only, or as a hybrid between the limit order liquidity and the AMM.
How Does IDEX (IDEX) Work?
IDEX is the first hybrid liquidity decentralized exchange that combines the capabilities of CEXes and DEXes without adopting the flaws of either. It took the automated market maker from decentralized exchanges such as Uniswap and combined it with an order book model that major centralized exchanges use to quickly and easily find a match for users who wish to buy or sell their coins and tokens. That way, it ensured the DEX’s liquidity and security while still enabling the performance and features of traditional, order book model-based centralized platforms.
This approach does away with failed trades and eliminates the problem of wasting money on gas fees, which makes the trading experience more efficient and generally more pleasant for the trader. At the same time, things like front-running and sandwich attacks also become ineffective, and actually fully impossible to conduct. Finally, users get to trade without having to wait for previous trades to settle.
This also opens the doors to additional trading strategies and advanced order types, which means that traders gain more options when engaging with cryptocurrencies, and that, in turn, increases the number of users who are going to find what they need to accommodate their trading style.
How to Buy IDEX (IDEX)
Currently, IDEX (IDEX) is available for purchase on the following exchanges:
Kraken – Founded in 2011, Kraken is one of the most trusted names in the industry with over 9,000,000 users, and over $207 billion in quarterly trading volume. Accepts USA and Canadian residents.
The Kraken exchange offers trading access to over 190 countries including Australia, Canada, Europe, and is our most recommend exchange for USA residents. (Excluding New York & Washington state)
KuCoin – This exchange currently offers cryptocurrency trading of over 300 other popular tokens. It is often the first to offer buying opportunities for new tokens. USA Residents are Prohibited.
Binance – Accepts Australia, Singapore, and most of the world. Canadian & USA residents are prohibited. Use Discount Code: EE59L0QP for 10% cashback on all trading fees.
IDEX (IDEX) — The first-of-a-kind hybrid DEX
IDEX is a new and unique type of decentralized crypto exchange that revolutionizes the exchanging process by combining the best that DEXes and CEXes have to offer. The process brings a number of benefits, such as guaranteed liquidity, lower transaction costs, or rather, the lower number of times when you need to pay transaction fees, and more. As such, IDEX might have a significant impact on how future DEXes will be built and how they will work. Meanwhile, IDEX itself is an exchange that has big plans for the future, which include expansion to other chains, the addition of new assets, features, and alike.
Ali is a freelance writer covering the cryptocurrency markets and the blockchain industry. He has 8 years of experience writing about cryptocurrencies, technology, and trading. His work can be found in various high-profile investment sites including CCN, Capital.com, Bitcoinist, and NewsBTC.
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