What if you took the best parts of a Centralized Exchange (CEX) and combined them with a Decentralized Exchange (DEX)? That’s what we’re doing at GammaX.
DEXs are peer-to-peer permissionless exchanges like Uniswap in which users can swap tokens. Most DEXs like Uniswap use automatic market makers (AMMs) to incentivize users to provide liquidity in exchange for a share of transaction fees and LP token rewards. DEXs are the heart of DeFi, relying on non-custodial wallets in which users store and manage their keys.
CEXs are quite different. They typically use order books to match buyers and sellers. If you’ve used Coinbase, Kraken, or even the New York Stock Exchange, you’ve used a Central Limit Order Book (CLOB). With a CLOB-based CEX, the exchange serves as the middleman between buyers and sellers, handling the transactions and keeping the data off-chain in the CEX’s database.
Swap-based DEXs are different from CLOB-based CEXs in two main ways. First, liquidity providers can often experience something called “impermanent loss” when a token price rises or falls after you deposit it in a liquidity pool. Secondly, users can only place market orders on swaps. While swap-based exchanges are easier for traders, CLOB-based exchanges allow for more advanced order types. With a CLOB-based model, users can execute limit orders, stops, and more.
Our CLOB-based DEX is a model that brings together the best of both worlds by having a multitude of order types: limit order, market order, stop-limit order, stop-market order, and many more. It allows for better prices, lower order latency, and faster order execution. Plus, using a CLOB-based DEX model would allow such things as everlasting options, hashrate futures, index futures, and volatility futures.
By using the CLOB-based model, GammaX will be able to have a wider and more liquid selection of perpetual trading pairs than any DEX. Visit GammaX Exchange to sign up for our testnet launch. If you want to be the first to know when we launch on mainnet, follow our Twitter.
