In recent times, decentralized exchanges (DEXs) have emerged as a viable different to centralized exchanges (CEXs) on this planet of cryptocurrency buying and selling. The transaction quantity on DEXs has been steadily rising, reaching $224 billion from April 2021 to April 2022, surpassing that of centralized exchanges, which recorded $175 billion in the identical interval. This marks a major shift, contemplating that Chainalysis reported that over 90% of cryptocurrency transactions had been carried out on centralized exchanges within the first half of 2021.
So why the sudden rise of decentralized exchanges? One of many foremost causes is the transparency they provide, which is missing in conventional exchanges. Furthermore, after a number of high-profile bankruptcies of centralized exchanges like Celsius and FTX, customers are more and more cautious of the dearth of regulation and transparency within the trade.
As consciousness of the danger that “clients can’t transparently confirm their held property” with centralized exchanges will increase, extra customers are choosing decentralized exchanges as a substitute. Nevertheless, decentralized exchanges nonetheless fall in need of being an ideal different for customers. That is primarily because of the persistent downside of “fuel charges” related to decentralized exchanges. In contrast to centralized exchanges, decentralized exchanges function on the blockchain, which signifies that fuel charges are incurred for every transaction. For customers accustomed to buying and selling with out fuel charges on centralized exchanges, this could be a important impediment.
Even Binance and Uniswap couldn’t remedy this downside
Binance stays the highest desire for cryptocurrency merchants on account of its handy buying and selling providers, user-friendly interface, and various vary of buying and selling pairs. In accordance with CoinMarketCap, it has recorded a buying and selling quantity of over $17 billion within the final 24 hours, surpassing well-liked exchanges like Coinbase and Kraken.
Nevertheless, transparency regarding clients’ property stays a problem. Though Binance conducts common “Proof of Reserves” audits to show that it holds ample reserves to cowl all person balances, considerations have been raised in regards to the firm’s debt exceeding its property primarily based on its beforehand disclosed reserve proof report.
Because of the system of centralized exchanges, clients’ transaction histories usually are not transparently disclosed, and because of this, considerations in regards to the “security of funds” for customers haven’t been utterly addressed. Entrusting property to a 3rd get together is the primary downside of centralized exchanges, which not solely contradicts the basic ideas of cryptocurrencies and blockchain expertise but additionally makes it weak to hacking or cyber assaults since all property are managed in a single place. Moreover, the advanced KYC (Know Your Buyer) course of can also be thought-about a serious downside.
Can Decentralized exchanges remedy this?
Trying on the well-liked decentralized trade, Uniswap, it permits customers to instantly commerce on the blockchain utilizing their private wallets with out the necessity for a posh KYC (Know Your Buyer) course of. This provides customers full management and transparency over the storage and administration of their funds, in addition to easy accessibility to details about their property. Nevertheless, as all transactions are recorded on the blockchain, every transaction incurs a fuel price, which could be a important drawback for customers who often commerce. Moreover, the dearth of freedom from fuel charges limits the varieties of supported buying and selling providers, resulting in decrease general liquidity in comparison with centralized exchanges. Moreover, the person interface with out an order ebook differs considerably from centralized exchanges, making it harder for present centralized exchanges customers to navigate.
How INNODEX affords better of the each worlds?
INNODEX operates like a conventional DEX, enabling customers to retailer and commerce their property instantly from their private wallets with out sophisticated KYC procedures. This ensures that customers retain full management over their funds, and the transparency of the blockchain permits for simple monitoring of their holdings. Nevertheless, INNODEX’s key innovation lies in its potential to get rid of the excessive fuel charges related to every transaction on a DEX. As a substitute, a single fuel price is charged each day when the person’s pockets is synced with the blockchain, with no further charges charged for subsequent trades.
However that’s not all – INNODEX additionally affords a variety of options that might be acquainted to CEX customers, similar to a complete order ebook and a number of order varieties together with market orders. This makes it extra accessible to customers who’re used to buying and selling on centralized platforms, with out sacrificing the advantages of decentralization.
With INNODEX main the best way, it’s clear that DEXs have come a great distance in addressing the constraints of conventional exchanges whereas retaining the important thing benefits of blockchain expertise. By providing a extra user-friendly and cost-effective option to commerce, they’re poised to change into the popular platform for crypto merchants all over the world.
The INNODEX platform, powered by NvirWorld’s “Keep Pending” expertise, may show to be a game-changer in decentralized exchanges. It reduces fuel charges for customers and maximizes comfort, reducing the entry barrier for decentralized exchanges to safe plentiful liquidity and supply quite a lot of buying and selling providers near centralized exchanges. NvirWorld can also be growing and offering numerous different patented applied sciences to commercialize blockchain expertise. One of many patented applied sciences is permitting customers to make cost and transactions utilizing cryptocurrencies even throughout community blockages, and this expertise is being launched into the mainnet scheduled to be launched within the fourth quarter.
Furthermore, NvirWorld has official partnerships with trade consultants Solana and ConsenSys, and has launched the deflationary coin “NVIR,” which is gaining consideration as having potential akin to Ethereum as a blockchain mission.
With INNODEX, there is no such thing as a have to make regretful decisions between centralized and decentralized exchanges, because it absorbs solely their benefits and eliminates their disadvantages.
The platform is presently present process the 4th closed beta check and repeatedly growing user-friendly further providers, similar to the e-mail login perform and Google Authentication for 2-factor authentication. INNODEX is predicted to open up new horizons within the cryptocurrency market, ushering in big perceptual modifications that may form the longer term.