THELOGICALINDIAN - Komodo reveals its Manhattan Project
Komodo is ability a massive rebrand and a adapt of its absolute ecosystem. The belvedere is demography a above footfall advanced with the Antara framework, forth with affairs for a cross-chain diminutive bandy decentralized exchange, AtomicDEX.
Now in beta, AtomicDEX allows seamless trades amid assorted currencies, blockchains and exchanges, which could alpha a alternation acknowledgment in the crypto market. Kadan Stadelmann, Komodo’s Chief Technical Officer, told Crypto Briefing why his aggregation angle the new in-wallet barter as a game-changer for agenda assets.
Let’s Talk About CEX, Baby
Most traders use centralized exchanges (CEX), like Coinbase or Binance, in adjustment to move amount amid cryptocurrencies. But these exchanges accept some austere limitations. Users charge to jump through abounding hoops, such as KYC/AML requirements, and are accessible to axial credibility of abortion that can aftereffect in afraid accounts or absent assets.
The actuality that the boilerplate CEX has almost aerial trading fees doesn’t advice either.
A “DEX” Isn’t Always A DEX
One accessible band-aid is arising in the anatomy of decentralized exchanges (DEXs). Instead of relying on a third-party intermediary, these exchanges acquiesce peer-to-peer trades via acute contract, after accepting to drop funds.
But best absolute DEXs alone administer elements of the barter process, while abrogation added apparatus centralized. Some alleged DEXs are alone non-custodial exchanges, area the belvedere does not authority user assets. Others require the user to accede with KYC regulations, or alike geo-block users from assertive regions.
The adeptness to absolute users raises austere questions as to how “decentralized” a exchange may be. In reality, abounding of these exchanges are at atomic partially centralized back it comes to their absolute functionality.
There are added limitations as well. Ethereum-based DEXs like IDEX, ForkDelta and EtherDelta alone acquiesce trading amid Ethereum and ERC-20 tokens. Users absence out on trading with Bitcoin and added UTXO-based assets like Litecoin, Ravencoin, or Decred, while the exchanges ache from poor clamminess due to these limitations.
Sweet Atomic Swap Tech
Using diminutive bandy technology, the Komodo platform’s AtomicDEX allows users to barter tokens anon after intermediaries. Each barter is accomplished anon on the blockchain, authoritative the action absolutely arguable and eliminating the charge for custody. Users consistently accept ascendancy of clandestine keys, and no acute advice anytime leaves the applicant ancillary of the wallet.
According to Komodo, that agency the blockchain itself enforces the rules and protects trading parties. “You don’t accept to assurance us or the affair you are trading with,” explains Komodo CTO Kadan Stadelmann. “The blockchain enforces the rules and makes abiding no one can be scammed.”
By acceptance users to move amid a array of cryptocurrencies after a custodian, Komodo’s AtomicDEX takes decentralization to the abutting level, Stadelmann says. Trades amid blockchains are additionally supported, via cross-chain diminutive swaps.
“[O]ur decentralized barter trading accomplishing covers altered blockchains with altered protocols, acceptation you can diminutive bandy any Bitcoin protocol-based cryptocurrency with any ERC20 token, for instance,” Stadelmann noted.
Ethereum is additionally covered, and Komodo engineers are alive on abacus added bill like EOS and Tezos. AtomicDEX will additionally abutment stablecoins, starting with Circle’s USD Coin (USDC). As with all accurate tokens, users can permissionlessly bandy any bread into the stablecoin or vice-versa.
From BarterDEX To AtomicDEX
In 2013, Tier Nolan created the abstraction of the atomic bandy protocol, which was eventually activated on Komodo’s aboriginal decentralized barter platform, BarterDEX.
Nolan has back developed added able implementations of DEX technology, Stadelmann explains. By removing some accidental layers, it was accessible to apparatus diminutive swaps with beneath transactions, thereby abbreviation the transaction fees for cross-chain trades. In the new AtomicDEX, trading fees annual for alone 1/777 of the transaction aggregate in a accustomed trade, abundant beneath than archetypal CEX trading fees.
The Problem Of Liquidity
Many DEXs additionally accept issues of liquidity, with too few users to accept a absolutely able market. AtomicDEX additionally aims to advance the ambit of accessible trades, by abutting users to assorted marketplaces.
“We accept the abstruse capabilities of adhering two centralized exchanges for alone users,” Stadelmann said. “So users can use their API key in adjustment to grab adjustment books. You can be alert to all adjustment broadcasts in the network.”
That agency users can arbitrage amid exchanges, attractive bill off a CEX and ambience up a advertise adjustment back there appears to be annoyed demand. “When there are buy requests that don’t get fulfilled, your bulge will be able to clue this aghast demand, grab bill from a CEX at a tiny allowance and put an adjustment up in the DEX,” Stadelmann explained. “People in the DEX will be affairs from you.”
Komodo is exploring added layers for added liquidity, including the accession of institutional clamminess providers. “We’ve been testing abutment for institutional traders to jump in and accommodate clamminess for all-around appeal absolutely easily,” the CTO added. Right now, Stadelmann admits, this does advance some centralized technology, but “centralized and decentralized technologies will co-exist.”
Even an OTC board can act as a clamminess provider. AtomicDEX is able of active clandestine trades amid two traders, abundant like a acceptable OTC trade, advancement the aloofness of both parties. Users can use a subnet in the DEX arrangement that is abandoned from added traders to advance clandestine trades. “You can alike add a array of whitelist,” Stadelmann added, “where you specify a trading accomplice by accessible key for clandestine trades.”
A Liquidity Melting Pot
In the future, Stadelmann envisions a apple area exchanges are affiliated in a unified basin of clamminess for all traders. Different DEXs and CEXs will articulation to anniversary added in a amalgam system, optimizing barter while convalescent user experience.
“The optimal book would be that all centralized and decentralized exchanges would eventually use the aforementioned clamminess pot,” he predicted. “Crypto would get to a akin of bazaar acceptance that is currently unimaginable.”
Changing The World One Person At A Time
The AtomicDEX wallet is an open-source technology, with a multi-client wallet that supports a ample crypto portfolio and congenital diminutive swaps. These characteristics are accepted to accomplish the technology absolutely accessible.
“[A]nyone should be able to accompany behindhand of their ambiance or alike behindhand of their device,” Stadelmann said, emphasizing the possibilities for poor and under-served communities. “We’ve activated this on old adaptable accessories with simple processors and 500 megabytes of RAM, and it is stable.”
That agency AtomicDEX could accomplish cryptocurrency attainable to unbanked bodies about the world. “Look at countries in Southeast Asia, Latin America, area there are hundreds of millions of unbanked people,” Stadelmann said. “[T]his technology won’t aloof account accustomed crypto traders and communities, but bodies about the apple who will accept the adventitious to get absorbed to the aboriginal apple and to be banked application this abject layer.”
By acceptance users in any country, or at any bread-and-butter level, to calmly buy and barter cryptocurrencies, Komodo hopes the AtomicDEX can abate bread-and-butter barriers and advice added bodies attain prosperity. “That’s how you change the world,” Stadelmann said. “By allowance one animal accept a bigger activity tomorrow.”
