Decentralized exchanges (DEXs) have become a phenomenon in recent months, largely due to an explosion of interest in decentralized finance and cryptocurrencies in general.
Even so, existing DEXs tend to suffer from many of the same issues such as slow speeds, high costs, and the lack of liquidity required to keep slippage at a low level. But that could change with the development of Polkadex – a substrate-based DEX with many innovations.
Polkadex is a platform that combines the best of centralized and decentralized exchanges and encapsulates them into a comprehensive solution that maintains the fund’s autonomy and security while providing an intuitive trading experience.
The platform includes several key products such as:
– Polkadex Orderbook: An exchange platform based on a decentralized order book that does not hold (custody) funds.
– Polkadex IDO Platform: IDO platform for tokens based on substrates.
– Polkadex Mobile: Mobile trading application that supports cold wallets.
– Polkadex Decentralized Blockchain Network: Parachain / Decentralized Blockchain supports swap protocol with free and no pre-run swaps.
Polkadex Orderbook is the key product. It’s designed to support up to 500,000 transactions per second with low latency in milliseconds – enabling things like algorithmic and high frequency trading. The platform also supports both Ethereum and substrate-based assets, initially via ChainBridge and later via trusted on-chain bridges using “Snowfork” technology.
The platform paves the way to make decentralized trading more accessible and powerful by maximizing liquidity and supporting cross-chain support and becoming one of the first DEXs to support fiat currency through Polkadex Fiat.
The Polkadex product suite is currently being built by a potential 20-person team led by CEO (and acting CTO) Gautham J and is being supported in an advisory capacity by renowned consultants such as Garlam Won and Matthias Hafner.
The platform conducted an IDO on Polkastarter in April 2021, and PDEX tokens were released for trading shortly afterwards. PDEX can now be traded on several popular exchanges such as KuCoin, Uniswap and Gate.io.
Polkadex officially launches the mainnet on September 29, 2021.
The Polkadex product ecosystem is built on Substrate, which is also the framework that powers Polkadot and enables developers to easily deploy application-specific blockchains.
The Polkadex blockchain is designed for DEXs and contains a number of features designed to make trading safer. Their focus is on the user experience and the elimination of gas charges.
Initially, Polkadex will use ChainBridge to connect Ethereum’s assets. Once the parachain is secured, they use Snowfork, another project in the Web3 ecosystem. The Snowfork will connect Ethereum-based assets (e.g. ETH and ERC-20 tokens) to the substrate so that they can be traded in the Polkadex order book.
The Polkadex Orderbook platform will also include a number of tools designed to make trading easier and more profitable. One of these is the asset trustee function, which enables users to entrust their assets to a third party – such as a fund manager or an algorithmic trading robot, who can then trade on their behalf.
Since Polkadex Orderbook is a decentralized trading platform, users have full custody of the deposit (except in the case of a trust) and do not need to create an account to raise liquidity.
From Q2 / 2021 Polkadex will run on test network V2.0 and V3.0 of the test network was executed on June 21, 2021. Mainnet will launch in the third or fourth quarter of 2021 along with the development of Polkadex Parachain.
The Polkadex website lists the main features of the Polkadex Orderbook as follows:
The Polkadex research team aims to leverage the latest blockchain technologies and develop a variety of innovative technical solutions to support the DEX and other platform products.
Much of the functionality of Polkadex is made possible by being built on substrates – this is also the framework that powers Polkadot and several other upcoming platforms. Here are the main differences in the platform.
SIMPLEbased on order book
Unlike most popular decentralized exchanges, Polkadex Orderbook is not an automated market maker (AMM) – that is, it does not use any of the assets in the liquidity pool to generate the value of the property itself. Instead, it’s more of a centralized exchange that offers a full order book including bid and ask orders.
Free transaction
Polkadex Orderbook supports two types of orders: limit orders and market orders. There is a small transaction fee for the market for accepting orders, while the market for order execution is completely free. The best thing about it is that there are no gas or network fees for placing and clearing orders as with a decentralized exchange. This makes high-frequency trading easier for trading bots and other API-based bots.
Polkadex Fiat
Polkadex Orderbook has the potential to become the first decentralized exchange to support fiat money thanks to its decentralized KYC (identity verification) feature. After verifying identity with Polkadex’s cryptographically secure KYC identification method, users can purchase tokens directly with Fiat (e.g. by credit card or bank transfer) without resorting to any organization. In essence, the Polkadex application and blockchain never store user data. You will receive cryptographic proof from another blockchain to verify the user’s unique certificate.
Polkadex IDO platform
Polkadex is expected to develop the IDO platform (Testnet launch July 5th) for projects launched on Substrate and Ethereum to help promising projects raise funds while also starting token distribution. Features currently planned for the IDO platform include zero gas fees, affordable fees (for projects and investors), on-chain governance, and instant token generation capabilities (e.g. purchase rights issue plans and support tokens) .
Given their popularity in the crypto world, DEXs are among the first to launch on the new blockchain. However, for the most part, these exchanges fall into the AMM category and support either fixed rate swaps or dynamic rate swaps.
By far the most popular AMM is Uniswap, which runs on Ethereum. Of course, Uniswap may be Polkadex’s main competitor, but while the two share some similarities, they still have many differences.
First, Polkadex supports full order books and uses a Trusted Execution Environment (TEE) to ensure that transactions are securely executed. Uniswap, on the other hand, uses a federated curve and users draw trustworthy liquidity from one or more liquidity pools.
In addition, Polkadex is based on Substrates – a high-speed blockchain platform that allows large numbers of transactions to be processed simultaneously without kinking. In addition to the fee-free swap, this is also intended to address the overload and fee issues that have paralyzed Uniswap so far.
But probably the most important of these is the social KYC and Fiat support from Polkadex. Unlike Uniswap, Polkadot allows users to complete social KYC (KYC via social network) and generate orders using fiat currency. This feature is offered alongside standard crypto-to-crypto trading. Later on, Polkadex will use KILT Protocol’s SocialKYC platform for authentication.
Both platforms are considered decentralized exchanges and can be accessed by anyone anywhere without creating an account. They are also non-custodial, which ensures that users remain in full control of their funds while trading.
Minh Anh
According to Coinmarketcap
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