Decentralized exchanges have been a viable option to central exchanges in cryptocurrency trading for many years. From April 2021 to April 20,22, the transaction volume on DEXs grew steadily, reaching $224 Billion. This is more than the $175 billion recorded by centralized exchanges in that same time period. Chainalysis stated that 90% of cryptocurrency transactions were carried out on centralized exchanges.
Why is there a sudden increase in decentralized exchanges. The main reason is their transparency, which is not available in traditional exchanges. Users are also becoming increasingly concerned about lack of regulation and transparency after several prominent bankruptcies at centralized exchanges, such as Celsius or FTX.
As awareness of the risk that “customers cannot transparently verify their held assets” with centralized exchanges increases, more users are opting for decentralized exchanges as an alternative. But, even though decentralized exchanges offer a better alternative, they are still not perfect. This is mainly due to the persistent problem of “gas fees” associated with decentralized exchanges. Decentralized exchanges are not centralized and operate on the blockchain. Transactions incur gas fees. This can prove to be a major problem for users who are used to trading on centralized exchanges without paying gas fees.
This problem was not solved by Uniswap or Binance.
Binance is still the preferred choice for cryptocurrency traders because of its easy trading services, user-friendly interface and wide range of trading pairs. It has surpassed popular exchanges such as Kraken and Coinbase in terms of trading volume, with a total trade volume of $17 billion over the past 24 hours according to CoinMarketCap.
However, transparency concerning customers’ assets remains a challenge. Although Binance conducts regular “Proof of Reserves” audits to prove that it holds sufficient reserves to cover all user balances, concerns have been raised about the company’s debt exceeding its assets based on its previously disclosed reserve proof report.
Due to the system of centralized exchanges, customers’ transaction histories are not transparently disclosed, and as a result, concerns about the “safety of funds” for users have not been completely addressed. Centralized exchanges have the disadvantage of allowing assets to be transferred to third parties. This is contrary to the principles of cryptocurrencies, blockchain technology and makes the system vulnerable to hacking and cyber attacks. Also, KYC (Know Your Customer), is a significant drawback.
This can be solved by decentralized exchanges
Uniswap, a popular decentralized platform, allows users to trade directly on blockchain using their personal wallets, without the need for a complicated KYC process (Know Your Customer). This allows users to have full control and transparency over their funds storage and management. Users also have easy access information about their assets. Users who trade often may find it a disadvantage to pay a fee for each transaction, since all transactions are recorded on blockchain. The lack of flexibility in gas fees can limit the number of trading services supported, which results in lower overall liquidity than centralized exchanges. The user interface without an ordered book is different than centralized ones, making it more difficult to use for users of existing centralized platforms.
INNODEX has the best of both worlds.
INNODEX functions like a traditional DEX. It allows users to store and trade their assets straight from their wallets, without the need for complicated KYC procedures. Users retain complete control of their funds and can monitor their holdings easily through the transparency of blockchain. However, INNODEX’s key innovation lies in its ability to eliminate the high gas fees associated with each transaction on a DEX. Instead, a single gas fee is charged daily when the user’s wallet is synced with the blockchain, with no additional fees charged for subsequent trades.
But that’s not all – INNODEX also offers a range of features that will be familiar to CEX users, such as a comprehensive order book and multiple order types including market orders. This makes it easier for users who have been used to trading on central platforms, but without sacrificing the benefits and convenience of decentralization.
With INNODEX leading the way, it’s clear that DEXs have come a long way in addressing the limitations of traditional exchanges while retaining the key advantages of blockchain technology. They offer a more user-friendly, cost-effective and convenient way to trade crypto assets around the globe.
The INNODEX platform, powered by NvirWorld’s “Stay Pending” technology, could prove to be a game-changer in decentralized exchanges. It allows users to save gas and maximize convenience. This technology lowers the entry barrier to allow decentralized exchanges to provide trading services that are comparable to those offered by centralized exchanges. NvirWorld also develops and provides other patent technologies for the commercialization of blockchain technology. This technology allows users to pay and transact using cryptocurrency even when there are network blocks. to be introduced to the mainnet during the fourth quarter.
Moreover, NvirWorld has official partnerships with industry experts Solana and ConsenSys, and has launched the deflationary coin “NVIR,” which is gaining attention as having potential comparable to Ethereum as a blockchain project.
INNODEX eliminates the need to choose between decentralized and centralized exchanges. It absorbs only their strengths and eliminates their weaknesses.
The platform is currently in its 4th closed beta testing and constantly developing user-friendly extra services such as email login and Google Authentication 2FA. INNODEX is expected open new horizons for the cryptocurrency market, bringing about huge perceptual shifts that will shape the future.