Exchanges are currently the most important players in the crypto field. They manage millions in crypto and fiat currency every day, and control the assets of a myriad of users. Their power and influence on the market is seemingly too much sometimes. Exchanges represent to this day the centralized authority that Bitcoin, and the other cryptocurrencies that followed, tried so hard to remove.
How can we contain their influence?
As an answer to the exaggerated weight of these players, decentralized exchanges have come forward. Yet it is hard for decentralized projects to compete with these giants. Generally, decentralized exchanges are difficult to use and significantly slower, as a direct consequence of their decentralized nature.
The centralized structure of the most popular exchanges is what makes them so fast and easy to use. These exchanges provide to users the illusion of real-time transactions. It’s just an illusion though, because the money never leaves the exchange, it just moves from one address of the exchange to another. Addresses and private keys do not belong to the users but to exchange itself.
Having control over this huge amount of assets gives exchanges the aforementioned power and influence, and also entails security problems. When there is a security breach (and that does happen, be it an external or an internal attack), the funds of millions of users are compromised.
This does not happen with decentralized exchanges, where - as the word might suggest - there is no centralized authority. Funds and private keys are under the direct control of the users.
Despite this, decentralized exchanges remain slow - because of the technical times of blockchain operations - and are harder to use.
As a compromise solution, hybrid exchanges are on the rise. Hybrid exchanges decentralize all the important operations, meaning the settlement of assets and private key ownership. On the other hand, some processes - like order book and order matching - stay off-chain, and can therefore happen in real time.
This solves the slowness problem, while the exchange stays decentralized in the management of the addresses and there is no centralized deposit.
A good example of this hybrid structure, is the Tokedo Exchange, where a smart contract manages the settlement of the assets in blockchain, while a server infrastructure takes care of the information matching. This results in an exchange that decentralizes critical processes while staying fast and easy to use.
The Tokedo Exchange is about to been released and it appears to be an interesting competitor in the field. The exchange comes with a whole ecosystem designed with the purpose of making cryptocurrency mainstream. The exchange is in fact the third element of this ecosystem and is connected with the other two elements:
According to the project’s roadmap, the Tokedo Exchange will be released in main net this month, but you can already check out the exchange in test net. Tokedo is also opening its public sale in the upcoming month. Since November 19th at 8:30 UTC it will be possible to buy TKD, the tokens of the Tokedo Ecosystem. TKD can be used to get services of the Tokedo Ecosystem at special conditions. For example, it will be possible to get a 50% discount on the fees of the exchange by paying in TKD. To participate in the sale sign up now to the whitelist.
We need projects like Tokedo to pave the way with solutions that don’t sacrifice user experience and functionality on the altar of decentralization. Tokedo uses an advanced decentralized technology, but it is also approachable and takes the user into strong consideration, two things that shouldn’t be forgotten while striving for a decentralized world.
Why not check out our Security Token Offering list?
How can we contain their influence?
As an answer to the exaggerated weight of these players, decentralized exchanges have come forward. Yet it is hard for decentralized projects to compete with these giants. Generally, decentralized exchanges are difficult to use and significantly slower, as a direct consequence of their decentralized nature.
Risks connected with centralization
The centralized structure of the most popular exchanges is what makes them so fast and easy to use. These exchanges provide to users the illusion of real-time transactions. It’s just an illusion though, because the money never leaves the exchange, it just moves from one address of the exchange to another. Addresses and private keys do not belong to the users but to exchange itself.
Having control over this huge amount of assets gives exchanges the aforementioned power and influence, and also entails security problems. When there is a security breach (and that does happen, be it an external or an internal attack), the funds of millions of users are compromised.
But decentralized exchanges still have some limits
This does not happen with decentralized exchanges, where - as the word might suggest - there is no centralized authority. Funds and private keys are under the direct control of the users.
Despite this, decentralized exchanges remain slow - because of the technical times of blockchain operations - and are harder to use.
Hybrid exchanges: the compromise we have been waiting for?
As a compromise solution, hybrid exchanges are on the rise. Hybrid exchanges decentralize all the important operations, meaning the settlement of assets and private key ownership. On the other hand, some processes - like order book and order matching - stay off-chain, and can therefore happen in real time.
This solves the slowness problem, while the exchange stays decentralized in the management of the addresses and there is no centralized deposit.
A good example of this hybrid structure, is the Tokedo Exchange, where a smart contract manages the settlement of the assets in blockchain, while a server infrastructure takes care of the information matching. This results in an exchange that decentralizes critical processes while staying fast and easy to use.
The Tokedo Exchange is about to been released and it appears to be an interesting competitor in the field. The exchange comes with a whole ecosystem designed with the purpose of making cryptocurrency mainstream. The exchange is in fact the third element of this ecosystem and is connected with the other two elements:
- The Tokedo Token Creator: a platform to create one’s own token and token sale from scratch, with no technical knowledge The tokens generated get automatically listed on the Tokedo Exchange, attracting here new users and liquidity.
- The Tokedo Universal Wallet (Atomax): a wallet designed for the needs of those who operate in the ICO field. With periodic in-app airdrops from different projects, buit-in KYC and instant ICO participation, Atomax is the to-go wallet for ICO enthusiasts and for all of those who want to launch a token sale and need help to reach the right target and get it on board instantly. In the future the exchange will be integrated in the wallet.
According to the project’s roadmap, the Tokedo Exchange will be released in main net this month, but you can already check out the exchange in test net. Tokedo is also opening its public sale in the upcoming month. Since November 19th at 8:30 UTC it will be possible to buy TKD, the tokens of the Tokedo Ecosystem. TKD can be used to get services of the Tokedo Ecosystem at special conditions. For example, it will be possible to get a 50% discount on the fees of the exchange by paying in TKD. To participate in the sale sign up now to the whitelist.
We need projects like Tokedo to pave the way with solutions that don’t sacrifice user experience and functionality on the altar of decentralization. Tokedo uses an advanced decentralized technology, but it is also approachable and takes the user into strong consideration, two things that shouldn’t be forgotten while striving for a decentralized world.
Why not check out our Security Token Offering list?