Are decentralized exchanges really the future?
As an important part of the blockchain industry, the digital asset exchange is not only a head resource, but also a top income. In the past few years, it has enjoyed the dividends brought by the development of the entire digital asset. There are many companies like Coinbase, Huobi, For unicorns like Binance and OKEX, it can be said that no industry has grown so fast in the past few years.
Although in the eyes of insiders, digital asset exchanges are a very lucrative business, but I had a conversation with an exchange owner before, and he said that sometimes he would wake up when he was sleeping-dreaming that his exchange was hacked.
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Attempts to Decentralize Exchanges
On November 27, 2019, the Upbit exchange announced that at 13:00 local time, a total of 342,000 Ethereum was transferred from the Upbit Ethereum hot wallet to the anonymous wallet address. The announcement stated that the value of the stolen assets was about 49 million US dollars. .
In May 2019, Binance suffered a large-scale systematic attack, and hackers stole 7,000 bitcoins from Binance’s hot wallet; in early 2018, the Japanese cryptocurrency exchange Coincheck was hacked, and new coins worth $534 million were stolen. Economic currency (NEM) was looted.
There are too many such examples, plus the notorious "Mentougou Incident",Theft of digital assets by hackers is no longer a "black swan" event, but a "gray swan" event(Grey swan refers to something that is not completely unpredictable, but something that has not happened for a while)
The reason for the theft is that these centralized exchanges store assets in hot wallets,Hackers can steal the private key stored in the hot wallet. Once the hacker captures the server where the hot wallet is located, the private key will be leaked.
Based on the story of centralized exchanges, decentralized exchanges such as 0x, IDEX, WhaleEx, Newdex, Binance DEX, Decred and Nash exchange were born.
The main benefit of decentralized exchanges is that no trust is required, the ownership of user funds (private key) is in their own hands, and it is not controlled by a third party (centralized exchange), and it does not require too much personal information. Very good protection of personal data security.
At the beginning of this year, Changpeng Zhao, the founder of Binance, wrote an article called "Centralization vs Decentralization",It talks about two important advantages of decentralized exchanges, including security and freedom.secondary title
Decentralized Exchange 2.0
He said,
He said,In the future, custody rights and trading rights will be separated, and custody rights will be executed by a decentralized system, while transactions and other matching high-performance components will be handled by a centralized exchange, which can be well balanced Advantages and disadvantages of both.
When talking about the ease of use, Alex told me that the Demo of IDEX2.0 has been released and is currently being tested. The latest test data shows that in the version of IDEX1.0, each transaction consumes about 150,000 gas, which is the same as In contrast, IDEX2.0 adopts a new settlement transaction method,A settlement transaction can contain thousands of transactions, and a settlement transaction consumes about 300,000 gas, which is then evenly distributed to thousands of transactions, which greatly reduces transaction costs.
If the demo were to run on the mainnet, it would cost $60 per day to settle all these transactions, in contrast to the current version of IDEX, whichThe same amount of transactions will cost $30,000, which means a 99.8% savings in gas fees. In addition to cost savings, this level of throughput would consume 40% of the entire Ethereum network in the current version. But IDEX2.0 is designed to only consume 0.075% of the entire network, and can continue to expand without increasing network occupation.
Through the data, it is not difficult to find that IDEX is a leader in decentralized exchanges. It seems that after the completion of the Istanbul upgrade of Ethereum, it started the test of IDEX2.0 quickly.
IDEX2.0 will greatly increase the transaction speed of decentralized exchanges, reduce transaction fees, and provide traders with a trading experience closer to mainstream centralized exchanges.
At the same time, IDEX 2.0 has also established an incentive mechanism to combine transactions with a validator network with economic incentives. Participants can obtain part of IDEX transaction fees as rewards for their verification services, aiming to enable traders, market makers, It seems like a good idea for IDEX advocates to participate in building IDEX infrastructure to help extend the security and performance of the platform.
IDEX has not been announced much in China, and it seems to be relatively low-key, but they have been leading the development of decentralized exchanges, so they have also been given special attention by the industry.
Of course, compared to this test, I am looking forward to the birth of IDEX2.0. Will it lead the decentralized exchange to the next "spring"?
