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Author Topic: The DEX (Decentralized Exchange) Thread  (Read 12687 times)
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January 24, 2016, 04:54:21 AM
Last edit: March 25, 2018, 07:14:36 PM by CoinHoarder
Merited by d5000 (1)
 #1

IMO, one necessary piece of the decentralized and autonomous puzzle that gets wrongly neglected is decentralized exchanges (DEXs.) I think that, for good reason, DEXs will be a big market in the cryptocurrency space. As time goes on, more and more centralized exchanges keep:

1. Going bankrupt
2. Getting hacked
3. Offering little to no transparency
4. Operating on fractional reserves
5. Faking volume
6. Onerous KYC/AML requirements
7. Withdraw delays/holds
8. Participating in insider trading
9. Limitations due to regulations and preferential treatment when deciding which cryptocurrencies are added
10. Delisting & enlisting blackmail
11. Withdraw delays due to verification/KYC/security reasons

Eventually, due to the above issues, people will transition to decentralized exchanges. DEXs are necessary for completely decentralized and autonomous interactions.

This thread is intended to track the development and features of DEXs. Feel free to bump the thread with updates or new projects. I am not really sure which design is best at this point. This is intended to be a neutral thread, but feel free to discuss the pros and cons of each implementation. Which design is the best, or is the best solution yet to come? What ideas (if any) do you have to improve the DEXs' designs? Do you know of any other DEXs in existence/development?

(in alphabetical order)

0x Protocol
- Status: Released
- Website: https://0xproject.com/
- Exchange: https://0xproject.com/portal
- Whitepaper: https://0xproject.com/pdfs/0x_white_paper.pdf
Strengths:
- Working implementation
- Fully autonomous and decentralized
- 0x is a DEX "fat protocol" that other projects are building on top of, thus liquidity will be shared among multiple exchanges
Weaknesses:
- Only compatible with Ethereum and/or ERC-20 tokens

B&C Exchange
- Status: Vaporware Dead Project?
- Website: https://bcexchange.org/
- BCT Thread: https://bitcointalk.org/index.php?topic=1033773.0
- Whitepaper: https://bcexchange.org/assets/Blocks_&_Chains_Decentralized_Exchange.pdf
Strengths:
- Decentralized and autonomous network of multi-signature addresses
- No derivatives or IOUs (for cryptocurrencies)
- FIAT derivatives
Weaknesses:
- Vaporware

Bancor
- Status: Released
- Website: https://www.bancor.network/
- BCT Thread: https://bitcointalk.org/index.php?topic=1789222.0
Strengths:
- Working implementation
- Fully autonomous and decentralized
- Allows straightforward and simple (Shapeshift-like) exchanges
- A novel and elegant solution to the liquidity problem most DEXs and decentralized/autonomous stablecoins face
Weaknesses:
- Only compatible with Ethereum and/or ERC-20 tokens


BitBay
- Status: Released
- Website: http://bitbay.market/
- BCT Thread: https://bitcointalk.org/index.php?topic=890531
Strengths:
- Working implementation
- Fully decentralized peer-to-peer trading via atomic swaps
- No derivatives, multi-signature gateways, or IOUs
- Effectively, the DEX feature of BitBay is a decentralized version of LocalBitcoins
- The only DEX that allows for FIAT/Crypto trading without gateways, derivatives, or IOUs
Weaknesses:
- To be updated once I have time to do more research and better analyze it...

Bitshares
- Status: Released
- SPV Wallet: https://wallet.bitshares.org/?r=del.coinhoarder
- Website: https://bitshares.org/
- Forums: https://bitsharestalk.org/
Strengths:
- Working SPV implementation- the oldest and most established DEX
- Fully decentralized and autonomous exchange
- Commodity, FIAT, Equity, and Index-based derivatives are available for trading
- Advanced user issued asset and account features
- Decentralized referral reward accounts
- Allows for price discovery of multiple decentralized exchange's IOUs (a poloBTC will be of different value than a bittrexBTC will be different than a bitfinexBTC due to differentiating dynamics)
Weaknesses:
- Systematic risk of decentralized and autonomous derivatives (optional)
- Trusted third party risks of IOUs and On/Off ramps (optional)

Blocknet
- Status: Released
- Website: http://blocknet.co/
- BCT Thread: https://bitcointalk.org/index.php?topic=829576.0
Strengths:
- Fully decentralized peer to peer trading (via atomic swaps)
- No derivatives, multi-signature gateways, or IOUs
Weaknesses:
- You must download the entire blockchain of each coin you want to trade, have the wallets running, and configure the RPC username/pass*
- Trading is only working on the command line and/or in the GUI, but not user-friendly at all.

InstantDEX
- Status: Released
- Website: http://www.instantdex.org/
- BCT Thread: https://bitcointalk.org/index.php?topic=684090.0
- Forum: http://forum.instantdex.org/
Strengths:
- Working implementation
- Fully decentralized and autonomous peer-to-peer trading (via atomic swaps)
- Can access several different sources of liquidity, including Nxt assets like Multigateway coins and centralized exchanges via API keys
Weaknesses:
- You can only trade IOUs in the form of Nxt user issued assets
- You must download the entire blockchain of each coin you want to trade, have the wallets running, and configure the RPC username/pass*

Waves
- Status: Released
- Website: https://wavesplatform.com/
- BCT Thread: https://bitcointalk.org/index.php?topic=1387944.0
- Wallet (Chrome App): https://wavesplatform.com/#downloads_anchor
Strengths:
- Working implementation
- SPV wallet
- FIAT IOUs via gateways
- Centralized order matching allows quicker trades and defense against frontrunning
- Utilizes multi-signature gateways allowing deposit/withdrawal of real cryptocurrency
Weaknesses:
- Centralized order matching and gateways make Waves more centralized than most other DEXs
- You can only trade IOUs via gateways or other user issued assets.

* You will not have to download the entire blockchains once SPV nodes are made compatible. It is also possible to make a multi-coin SPV wallet so you don't have to download the blockchains, and you don't need to run several cryptocurrency's wallets separately.


Try to stay on topic. I will only delete posts sparingly... please no trolling or personal attacks, and try to make sure your post has some substance.
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January 24, 2016, 05:34:11 AM
 #2

Bitshares didn't gain enough traction because they just didn't have enough users to get enough volume and liquidity.

Heard about B&C.  I thought they should have a proof of concept/alpha release by now.

I think we will be living with centralized exchanges for a few more years...

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January 24, 2016, 05:40:39 AM
 #3

InstantDEX from jl777 & SuperNET is probably the closest to completion. It's been in development a long time now (some problems with GUI dev afaik), but when it's launched it'll mark a dramatic shift in the cryptosphere.

http://www.instantdex.org/

Quote
InstantDEX (Beta) is a decentralized exchange that is currency agnostic. It connects to exchange APIs and gives a single unified view of all exchanges – automatically detecting arb opportunities. InstantDEX allows cross coin trading of both altcoins and BTC without the need for any centralized exchange – thus keeping your assets safe and secure.

The “Instant” of InstantDEX refers to the core nature of this exchange: the exchange exists in a decentralized fashion across all machines in the network. Orderbooks are instantly updated and trades instantly cleared as they are matched. This is possible due to an advanced p2p messaging protocol, which will also include methods for private currency transactions and messaging via the BTCD components of teleport and telepathy.
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January 24, 2016, 05:57:39 AM
 #4

Bitshares didn't gain enough traction because they just didn't have enough users to get enough volume and liquidity.

Heard about B&C.  I thought they should have a proof of concept/alpha release by now.

I think we will be living with centralized exchanges for a few more years...


I agree, Bitshares' main weakness is the liquidity. Although,  the OPENBTC/BTS market actually had ~8 BTC in volume today which I think is impressive.. perhaps it is picking up steam. Some ideas being tossed around to improve liquidity:

- Changing the fee structure to resemble centralized exchanges (based on a percentage of the trade, with a maximum fee)
- Lowering fees to the bare minimum for however long it takes to gain more users and liquidity
- Sell the SmartCoin fee pool (fees accumulated from each SmartCoins' transactions/trades) back into the market X% over the price feed.
- Develop market making bots that users can run or invest in through a user issued asset (a complicated endeavor)
- Make an autonomous market making bot that users can buy shares of by depositing to its bankroll
- Implement "maker/taker" fees (lowering fees for market makers)
- Dilute BTS shareholders, and short assets into existence, then have the chain autonomously sell them X% above the feed price.

B&C Exchange has a functional wallet you can download on their website, but the exchange will not be functional for a while. Apparently, it may not be functional until later this year:

NuBits and B&C Exchange share the same team. This gives B&C the advantage of having people work on it that have worked with the code base for a year or two in most cases. It has the disadvantage of meaning that when the team is focused on NuBit development, B&C Exchange development necessarily gets less attention and work.

The NuBit 2.1 release has been a major undertaking. We thought we were nearly done with it a month ago, but testing revealed some important performance issues that were difficult and time consuming to track down and remedy. The NuBits 2.1 release is very close to being ready for beta release. As a result, the team is once again turning its focus to B&C Exchange. The B&C Exchange 4.0 release will receive additional testing in the coming days. Over the course of the last month, glv has continued to make progress on developing the exchange messages (to be released after 4.0).

Sigmike and I are discussing a couple ways we could bring additional developers to the project to speed implementation. While I regard the pace of development as a disappointment to date, we have effectively conserved our funding and I am more convinced that B&C Exchange has a viable design than I was six months ago. Progress has taken longer than expected due to lower availability of developers than was expected, but the project is still very viable and is in fact moving forward.

Are we going to see B&CExchange in operation in 2016?
--------------------
Perhaps in very late 2016, because we have only three part time developers.

Just to quickly follow up on Jordan's words regarding the development pace. Things slowed down a bit late last year because of the holidays, traveling, and new year administrative tasks. Things should be picking up from here on out. 4.0 development/testing is in full swing. Once everything is cleared BlockShares owners will be able to start voting on the available assets for trading and reputed signers.

Year end/start is a very busy time for people, and Nu had a similar development slump around the same time last year. I'll try to produce some regular updates regarding testing and development from here on out as well.
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January 24, 2016, 06:03:23 AM
 #5

InstantDEX from jl777 & SuperNET is probably the closest to completion. It's been in development a long time now (some problems with GUI dev afaik), but when it's launched it'll mark a dramatic shift in the cryptosphere.

http://www.instantdex.org/

Quote
InstantDEX (Beta) is a decentralized exchange that is currency agnostic. It connects to exchange APIs and gives a single unified view of all exchanges – automatically detecting arb opportunities. InstantDEX allows cross coin trading of both altcoins and BTC without the need for any centralized exchange – thus keeping your assets safe and secure.

The “Instant” of InstantDEX refers to the core nature of this exchange: the exchange exists in a decentralized fashion across all machines in the network. Orderbooks are instantly updated and trades instantly cleared as they are matched. This is possible due to an advanced p2p messaging protocol, which will also include methods for private currency transactions and messaging via the BTCD components of teleport and telepathy.

Thanks- I will add it to the OP tomorrow morning- I am winding down for the night. I am an investor in Supernet and like the idea of it. I need to pick up some InstantDEX tokens too.. that is the only DEX I that is speculate-able that I am not invested into. I wasn't sure if the InstantDEX was going to be tradeable or not, as for now I can only get the deposit, send, and withdrawal functions to work. I admittedly still am not too knowledgeable in the plans for InstantDEX/Supernet. I am gaining more and more faith in jl777 with each day that goes by. Initially, I was very skeptical of all his offerings since he seemed to start so many different projects very quickly. However, he has shown dedication and skill as far as glancing over his Github and other people's opinions about him that I respect.
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January 24, 2016, 06:15:44 AM
 #6

Supernet still being developed on top of NXT?  We gathered that the lead dev is dropping NXT due to some API issues in one of the upgrades.  And that the Supernet lead dev was the one responsible for dumping all that NXT to its lows.

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January 24, 2016, 09:25:39 AM
 #7

Supernet still being developed on top of NXT?  We gathered that the lead dev is dropping NXT due to some API issues in one of the upgrades.  And that the Supernet lead dev was the one responsible for dumping all that NXT to its lows.

i don't think jl777 has been dumping anything. he put up some sell walls to prove a point, but he later pulled them. afaik nxt is still utilized in the project. as i mentioned earlier in this thread supernet and nxt are two seperate entities. all this happened a few month ago with the update to 1.6.2 on October 31 2015. things have cooled down now and both projects continue to be developed. nothing to get hung up on now imo.
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January 24, 2016, 10:36:24 AM
 #8

Agree, this is currently the best decentralized exchange solution in development. There is also a project going on for Ethereum platform.
I personally think that centralized exchanges do not have a future (look at MtGox, Cryptsy,...).

InstantDEX from jl777 & SuperNET is probably the closest to completion. It's been in development a long time now (some problems with GUI dev afaik), but when it's launched it'll mark a dramatic shift in the cryptosphere.

http://www.instantdex.org/

Quote
InstantDEX (Beta) is a decentralized exchange that is currency agnostic. It connects to exchange APIs and gives a single unified view of all exchanges – automatically detecting arb opportunities. InstantDEX allows cross coin trading of both altcoins and BTC without the need for any centralized exchange – thus keeping your assets safe and secure.

The “Instant” of InstantDEX refers to the core nature of this exchange: the exchange exists in a decentralized fashion across all machines in the network. Orderbooks are instantly updated and trades instantly cleared as they are matched. This is possible due to an advanced p2p messaging protocol, which will also include methods for private currency transactions and messaging via the BTCD components of teleport and telepathy.
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January 24, 2016, 11:09:00 AM
 #9

funny nobody seems to want to mention the ELEPHANT in the room:

https://bitcointalk.org/index.php?topic=1309597.0



Looks like a scam that could give Ethereum a bad name.

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January 24, 2016, 11:49:14 AM
 #10

The real problem with the idea of a decentralised exchange is not the technology, its the users.

Users do not care about decentralisation at all. The only thing they care about is convenience, fees, speed and security. DEX has great security, but fees will always be higher and speed will always be slower.
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January 24, 2016, 12:28:16 PM
Last edit: January 24, 2016, 12:38:19 PM by Fuserleer
 #11

The real problem with the idea of a decentralised exchange is not the technology, its the users.

Users do not care about decentralisation at all. The only thing they care about is convenience, fees, speed and security. DEX has great security, but fees will always be higher and speed will always be slower.

Correct, users don't care.

Plus, trade speed will be the critical problem that will prevent any DEX from seeing high volume, especially in the future.

I've spent quite a lot of time looking at ways to achieve high frequency trading (HFT) that is both secure and reliable (trades don't go missing, no "queue jumping"), and I don't think its possible to get < 5 second easily without some form of semi-centralization.  When you compare traditional HFT exchanges such as the NYSE and others which are able to process trades sub-millisecond, well, our decentralized counterparts are never going to be able to compete as a serious alternative.

The fastest I've been able to get trades in our DEX with sufficient reliability is about 10 seconds, but that comes with quite a bit of overhead across the board in terms of bandwidth, processing and other costs.

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January 24, 2016, 01:26:27 PM
 #12

There are better ways to do this, however I doubt a fully anonymous exchange is even desirable. In the end its about how one thinks about law, risk and identity. The failures of MtGox and Crytpsy are a bit over-rated since other exchanges have been operating for years. I think its in part that Bitcoin is just not good for holding deposits - its not that deposits are always undesirable. It should be possible to trust others if one chooses to. One can create reputation and credit systems on top of trustless systems. From a regulatory point of view consensus on assets is 100x harder then consensus on money. Imagine a fully P2P world-wide exchange. To get proper clearance for assets will be almost impossible for a long time. Otherwise one is operating in a legal greyzone. Anonymous digital cash and anonymous exchange are very different things. So one has to think about very clearly what kind of activity what wants to facilitate. It is impossible to touch fiat without KYC/AML, but that is not even desirable. To transmit fiat money on electronic networks one needs a banking license. Fiat money ultimately settles in the Internetbank market. A completely decentral exchange, IMO makes most sense for swaps between Altcoins and commodities.
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January 24, 2016, 03:33:41 PM
 #13

The real problem with the idea of a decentralised exchange is not the technology, its the users.

Users do not care about decentralisation at all. The only thing they care about is convenience, fees, speed and security. DEX has great security, but fees will always be higher and speed will always be slower.

I can agree that users don't seem to care about decentralization... yet. I think that centralized exchange users will keep getting "goxxed", and eventually everyone will understand why DEXs are so important. It is a long term play that requires the inevitable to continue happening (exchanges going bankrupt). Let me comment on your list of most important things for an exchange:

I can only use Bitshares as a measuring stick, but it is very convenient compared to most exchanges. Simply entering a username and password is much easier than most exchanges where you at the very least need to confirm your email address.

The fees can be adjusted, and I think soon you will see a competitive fee structure on the Bitshares DEX. Low percentage-based fees are inevitable because the community mostly agrees that is the only way to proceed.

As far as speed, Bitshares settles trades in less than 4 seconds, which sounds slow on paper but is actually pretty fast when you actually use it. It is hardly an inconvenience and is not that much slower than centralized exchanges. Maybe high volume day traders would not like the lag, but for casual traders or "buy and hold" types the lag is not a problem. That is my opinion of course, but I am in the latter group and the lag doesn't bother me a bit- 4 seconds or less goes by much faster than you'd think... 4 seconds is the maximum amount of time if you happen to submit the trade right after a block was produced, so in most cases it will be more like 2 seconds.

Security is great with DEXs.. that is the point. There is some systematic risks involved with decentralized derivatives, but I see them as being much more unlikely to collapse than a centralized exchange going belly up.
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January 24, 2016, 03:39:02 PM
Last edit: July 04, 2016, 03:06:25 PM by CoinHoarder
 #14

The real problem with the idea of a decentralised exchange is not the technology, its the users.

Users do not care about decentralisation at all. The only thing they care about is convenience, fees, speed and security. DEX has great security, but fees will always be higher and speed will always be slower.

Correct, users don't care.

Plus, trade speed will be the critical problem that will prevent any DEX from seeing high volume, especially in the future.

I've spent quite a lot of time looking at ways to achieve high frequency trading (HFT) that is both secure and reliable (trades don't go missing, no "queue jumping"), and I don't think its possible to get < 5 second easily without some form of semi-centralization.  When you compare traditional HFT exchanges such as the NYSE and others which are able to process trades sub-millisecond, well, our decentralized counterparts are never going to be able to compete as a serious alternative.

The fastest I've been able to get trades in our DEX with sufficient reliability is about 10 seconds, but that comes with quite a bit of overhead across the board in terms of bandwidth, processing and other costs.

Don't take this the wrong way, as I like you and your eMunie project, but I don't get this statement. You claim eMunie can process way more TPS than Bitshares, yet you can't get trades to settle on your DEX in less than 10 seconds? That doesn't make sense to me. Bitshares settles trades in less than 4 seconds reliably. In fact, 4 seconds is the maximum amount of time and it usually takes around 2 seconds, but it does depend on when you click the confirmation but in relation to when the last block was produced. I suggest trying Bitshares' DEX. I think you will be impressed with the speed of settlement.

Also, I don't think anyone expects DEXs (at least as the technology is today) to realistically compete with the NYSE or other large HFT exchanges. I only expect them to compete with cryptocurrency exchanges in the near to immediate future. You can however trade stocks and commodities on Bitshares which is a benefit compared to most cryptocurrency exchanges.
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January 24, 2016, 03:40:31 PM
 #15

funny nobody seems to want to mention the ELEPHANT in the room:

https://bitcointalk.org/index.php?topic=1309597.0


That thread has way too many sock puppets and shills for me to take it seriously. I will look into it though.. I remember seeing this thread but I never looked into elCoin.
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January 24, 2016, 09:25:17 PM
 #16

The real problem with the idea of a decentralised exchange is not the technology, its the users.

Users do not care about decentralisation at all. The only thing they care about is convenience, fees, speed and security. DEX has great security, but fees will always be higher and speed will always be slower.

Correct, users don't care.

Plus, trade speed will be the critical problem that will prevent any DEX from seeing high volume, especially in the future.

I've spent quite a lot of time looking at ways to achieve high frequency trading (HFT) that is both secure and reliable (trades don't go missing, no "queue jumping"), and I don't think its possible to get < 5 second easily without some form of semi-centralization.  When you compare traditional HFT exchanges such as the NYSE and others which are able to process trades sub-millisecond, well, our decentralized counterparts are never going to be able to compete as a serious alternative.

The fastest I've been able to get trades in our DEX with sufficient reliability is about 10 seconds, but that comes with quite a bit of overhead across the board in terms of bandwidth, processing and other costs.

Don't take this the wrong way, as I like you and your eMunie project, but I don't get this statement. You claim eMunie can process way more TPS than Bitshares, yet you can't get trades to settle on your DEX in less than 10 seconds? That doesn't make since to me. Bitshares settles trades in less than 4 seconds reliably. In fact, 4 seconds is the maximum amount of time and it usually takes around 2 seconds, but it does depend on when you click the confirmation but in relation to when the last block was produced. I suggest trying Bitshares' DEX. I think you will be impressed with the speed of settlement.

Also, I don't think anyone expects DEXs (at least as the technology is today) to realistically compete with the NYSE or other large HFT exchanges. I only expect them to compete with cryptocurrency exchanges in the near to immediate future. You can however trade stocks and commodities on Bitshares which is a benefit compared to most cryptocurrency exchanges.

Load handling isn't the same as settle or confirmation time, which is a completely different kettle of fish Smiley

It comes down to good old CAP and consensus.   Assume there is a trade T with an ask of 100.  User A submits a buy with a price of 100, User B also submits a buy with a price of 100 at exactly the same time but at the opposite end of the network.  Which is the correct buy to apply?  Some nodes will see A's buy first, apply it, and B's will be invalid, others will see B's first, apply it, and A's will be invalid.  Then you end up in a conflict, half think A was first and is the correct buy to match that ask, the other half think B.

So while the initial acknowledgement can be very fast (sub 1 second), the duration to come to consensus is much longer and in some circumstances the original acknowledgement that A and B see may not be the one the network ultimately agrees on.

In the case of Bitshares, it has what I consider to be semi-centralization in the form of DPOS, which makes this task much easier to do quickly.  Not only that, I doubt that Bitshares is seeing trading loads high enough yet to be triggering that scenario in the first place.

Bitshares also has very fast block times IIRC, and coupled with DPOS, they mitigate a lot of the problems that you have to deal with when doing the same in a fully decentralized system.

Is the Bitshares approach the right or wrong way?  That depends what you want from the platform, if it does what it says on the tin and both they and the users are happy with it.  If everyone is happy, then sure, why the hell not Smiley

Also I agree that HFT DEXs will probably never be required, but I spent a little time pushing the limits just so I knew where they were Smiley

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January 25, 2016, 06:46:05 AM
 #17

trade speed will be the critical problem that will prevent any DEX from seeing high volume, especially in the future.

I've spent quite a lot of time looking at ways to achieve high frequency trading (HFT) that is both secure and reliable

high volume and high frequency are two things. You could attract users to make infrequent large trade and get high daily volume. B&C allows user to trade between their own wallets and can potentially attract high value traders to trade often.

BTC 1HxvAEC4nj37hyenz9DwsyrMMnkwzpbzno PPC PU6zS8RRBWP2UxhuRFengGsu8n4tEYB5xV XPM AJAgBpPjGQoL38mrtW91dVqhbMHqu25vfG
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January 25, 2016, 10:36:30 AM
 #18

Here is another project

Lykke

website: http://www.lykkex.com
whitepaper: https://wiki.lykkex.com/colored_coin_exchange_white_paper

Lykke is a more of a mix of decentral and central exchange targeting a large scale market and also institutions. The authors have significant expertise in the traditional financial markets and I think that is a valuable perspective. As outlined its not the same as the idea of decentral exchange in the Cryptocurrency sense.

It is good to begin with the word exchange and think backwards from there. To physically exchange goods you need to be in the same location. To transport goods around the world one needs permission from those who control the flow of goods. Then one has the problem that one good might be legal in jurisdiction A and illegal in jurisdiction B. Part of a marketplace is also the definition and registration on what goods should be traded (markets where the cost of creating a digital asset is zero removes friction, but also leads to spam).

If both sides of the trade are not in the same jurisdiction its not an exchange in any legal sense - no legal protection for the buyer and seller. There is no purchase contract underlying the transaction, and no legal recourse. Note that the way the economic system currently functions is that we have large institutions which determine the outcomes of these processes and provide the market infrastructure. If you for instance want to buy a stock certificate in a developed country you have many different institutions involved (stock exchange, market-makers, brokers, settlement). The simpler, but still non-trivial case is a warehouse receipt. If two parties exchange 1 bar of gold for instance usually one has some expert acknowledging the quality of the metal. There are only 20 or so commodities traded on the large markets. To exchange a good or service is far more complicated than it seems. If one is exchanging physical goods for instance there is the question of quality and location. Undeveloped countries often lack financial infrastructure and need to build this on their own. In the case where such countries build up a new exchange market one can see what is involved with developing a marketplace. And this doesn't touch even on the complexity of equity and bond markets. A lot more research could be done in this area to show what things are possible and how Crypto-economics could lead to new types of markets.
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January 25, 2016, 10:58:26 AM
 #19

One can create reputation and credit systems on top of trustless systems.

IMO, this is a very bad idea. When identity generation is trivial, there is no recourse for the long con attack; attackers create an identity, build the required trust and then pull off a huge scam and repeat the process until the system as a whole is worthless.
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January 25, 2016, 11:39:16 AM
 #20

trade speed will be the critical problem that will prevent any DEX from seeing high volume, especially in the future.

I've spent quite a lot of time looking at ways to achieve high frequency trading (HFT) that is both secure and reliable

high volume and high frequency are two things. You could attract users to make infrequent large trade and get high daily volume. B&C allows user to trade between their own wallets and can potentially attract high value traders to trade often.

Confusion of context, I was referring to a high volume of transactions, not value, which I guess is the same as high frequency.

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