Decentalized Exchange Development
What is a Decentralized Exchange(DEX) ?
A decentralised exchange (DEX) is a crypto exchange that facilitates direct peer-to-peer transactions in a secure way and without the need for an intermediary or a source that must be trusted. The decentralization part can also extend to the governance part of the protocol.
Through decentralized exchanges (DEXes), users can trade digital assets amongst each other without the need for a central entity to hold their funds or to deposit funds in the first place. Users instead link their wallets to the exchange and verify their transactions by paying a fee, also known as a gas fee
OrderBook vs AMM DEXes
An Automated Market Maker(AMM) DEX is a DEX where the price is decided by algorithms, unlike an orderbook DEX where there is a maker and a taker. The formula vaties from protocol to protocol but the simplest algorithm in AMMs is constant product formula.
Here, x and y are both assets and the given the liquidity is constant the price is determined. Basically every time a crypto is bought the price increase and decreases whenever sold. AMMs may have high slippage but do not face the problem of having a large spread.
AMM also incur the issue of impermanent loss for the liquidity provider as they are the counter party during a trade.
Order book exchanges are more capital efficient if there is higher liquidity because of the a low spread and the maker taker model reducing slippage.
QuickSwap, 0x, Uniswap, Sushiswap are the example of some of the most popular and successful decentralized exchanges across blockchains.
DEX Development Service
We have quite a bit of experience in creating complex DEXes with customizable features such as custom slopes, integration of ve(3,3) tokenomics, yield farming, DEX aggregation, gasless DEXes and much more.
You can send us a email to inquire more about what we can do for you.