As decentralized exchanges become more popular, there are some glaring issues encountered within these systems that must be faced. Among these issues, two are the most pressing. The first issue revolves around the lackluster UX most DEXs possess when compared to centralized exchanges. The second is the reliance on centralized outside market sensors known as oracles.
Oracles are one of the most interesting technologies emerging out of the sector at this time. The ability to communicate data to and from the blockchain is incredibly valuable. Today, there are oracles that monitor a large variety of data. This data can be anything from cryptocurrency prices to the weather in a particular region of the world. Consequently, oracles hold endless potential in the space.
Oracles have one huge downside that makes them unsuitable for universal use at this time, they are centralized. As a centralized point of entry into the blockchain, they pose a huge security risk. When an oracle becomes compromised, it leaves the entire blockchain open to data manipulation. The problem is that DEXs need some way to accurately determine the value of a token so that traders know what they are getting.
The DEXToken Protocol
The DEXToken Protocol accomplishes this task through the integration of various proprietary technologies. At the core of the system is a speculative Automated Market Maker. This protocol enables price discovery based on volatility. The AMM benefits investors in some crucial ways. For instance, it reduces the volatility effect encountered on other DEXs such as Uniswap.
Liquidity Staking Coin Offering (LSCO)
DEXToken has been unique since day one. The firm raised eyebrows when it decided against any pre-sales or ICO. Instead, the firm went with, what can best be described as a Liquidity Staking Coin Offering (LSCO). In this strategy, a company uses staking phases for the purpose of ensuring a decentralized distribution of the token supply without holding a sale. Ideally, this incentivizes a fair and secure decentralization and distribution of the project.
DEXToken began its unique approach by pacing 20,000 DEXG on Uniswap. Notably, Uniswap is one of the best DEXs for new projects to acquire liquidity. Developers choose to start the initial value of the token at 0.5 USDT. The event concluded successfully. Interestingly, the funds from this round remained locked until 2022.
More Staking to Come
In total, DEXToken has eight major staking rounds planned for the coming months. Each round provides investors with a valuable opportunity to earn passive income staking their crypto. Users are rewarded with a part of the fees created by trading activity when they stake their tokens. Keenly, each round introduces more DEXG into the market.
LUNA is Here
The second round of staking is already set to begin this month. Specifically, the event will allow investors to deposit funds beginning on October 21, 2020. The best part is anyone can participate simply by adding DEXG to the Balancer shared pool. For your liquidity, you receive an equivalent value of BPT LP tokens.
The LUNA round has already received a lot of hype from investors, primarily because the event has a hefty reward of 5,250 DEXG. Interested stakers will need to lock their funds up to stake from October 23–30. You don’t have to wait for your rewards as they are paid out via smart contracts on the 30th as well.
An Experienced Team
The team behind the DEXToken project, the Flowchain Foundation Limited, is no stranger to the market. These savvy developers have been working on this project since early 2018. Over the course of two years, they managed to make some considerable strides towards their initial launch. Today, the firm operates offices in Taiwan, Mainland China, and Vietnam. This experience has helped developers to introduce new and exciting protocols to the market such as the Balancer Shared Pool.
Balancer Shared Pool
The Balancer Shared Pool is one of the features that place DEXToken a step ahead of the competition in terms of usability and safety. For one, this protocol eliminates investor exposure to high impermanent losses. This problem is a major concern for Uniswap investors. It occurs due to the platform’s insistence to maintain a weighted average at 50/50.
This coding prevents losses to liquidity providers through the integrations of a new proprietary weight protocol. This protocol enables more liquidity to remain in the system. It also allows developers to better issue rewards in a more fair and decentralized manner.
The Flowchain Foundation utilizes the DEXToken protocol to allow its IoT infrastructure to communicate with DeFi applications in a seamless manner. IoT (Internet of Things) is the term used to refer to the network of billions of smart devices around the world. IoT networks include everything from your smartphone to your smart fridge.
What makes an item “smart” is the addition of sensors and the ability to communicate with the internet. When you couple this technology with the immutable and instant nature of blockchain tech, you end up with a very powerful toolset that expands capabilities in the market to new heights.
For example, DEXToken is already capable of off-chain issuances. This functionality allows users to redeem and withdrawal off-chain issued tokens immediately. This feature allows DEXToken to connect the benefits of off-chain IoT networks and decentralized finance networks.
The DEXG token is the main governance token for the DEXToken network. This token allows users to pay fees, receive rewards, conduct swaps, and earn a portion of the trading fees accrued on the exchange. The more DEXG you hold, the more vote you will have when major upgrades arise. Additionally, DEXG holders will be rewarded with a share of the trading fees on the coming decentralized exchange.
DEXToken — Positioned for Success
It doesn’t take long to see that the DEXToken protocol brings a lot of usability to space. The DEX sector is in dire need of innovative platforms such as DEXToken. If large-scale adoption of these exchanges is to occur, users need to have access to all the features and benefits they desire. DEXToken accomplishes this task, not only by satisfying private user demands but also by offering solutions to enterprises and institutions to participate in the network with ease. With the professional and well-planned approach, Flowchain has outlined for the DEXToken Protocol, we are sure they will not only fulfill the expectations but also go beyond.
Originally published at https://www.cryptofolds.com on October 21, 2020.