The importance of DEX Smart Trading
According to The Block data, Decentralized exchanges have so far recorded nearly $100 billion in trading volume in November.
Uniswap V3 and V2 were the main contributors to November’s trading volume, with $47.37 billion and $24.07 billion, respectively.
Since the launch of IDEX in 2018, until the advent of Uniswap on the Ethereum network, and later similar AMMs on other EVM networks, Decentralized Exchanges have attracted huge volumes of transactions and users.
Crypto investment market participants who were previously only familiar with centralized exchanges such as Huobi, Binance, Coinbase… now have an attractive choice of using Decentralized exchanges with advantages such as:
- No KYC and identity disclosure required.
- Full ownership of assets on personal wallet address
- Access to potential tokens that have not been listed on major exchange
Things seem easy for DEXs, so why haven’t DEXs completely replaced CEXs yet? That’s because besides the advantages, DEX also has significant disadvantages.
Lack of control
Because DEXs are decentralized protocol, anyone can create tokens and list without any technical or legal hurdles. The scam is even more sophisticated when scammers intentionally create tokens with tickers that are similar to reputable project tokens to scam.
Besides, the rug-pull cases also left many haunts for investors in anonymous projects. Some other sophisticated scams are scammers that will lure users to a fake website that looks exactly like the official DEXs and trick users into entering their private key.
There are countless different forms of fraud for dAPP users in general and DEX in particular.
Lack of liquidity
Liquidity on DEXs is mainly taken from liquidity pools by liquidity providers. The motivation of liquidity providers is to seek profits from trading fees and incentive rewards from protocols, so there is often a flow of liquidity from protocols, leading to liquidity fragmentation and liquidity shortages at some point in time. From that, users will have to pay a higher cost than they expected when performing a token swap.
Lack of professional utilities
For professional traders, working anonymously on DEXs is a great thing, but in return, they do not have the same supporting tools as on CEXs: custom orders ( limit order, stop market , trailing stop etc ), order book, order matching information and various charts.
The lack of these facilities also contributes to a significant drop in potential trading volume, because a trader cannot spend 24/7 observing and monitoring the markets.
DEX Smart Trading: Solution by WingSwap
WingSwap’s DEX Smart Trading aims to address these disadvantages of DEXs. Smart Trading’s solutions aim to reduce security risks and help optimize profit opportunities for users.
The product is still in the testing and auditing phase. However, we may disclose some of the mechanics of Smart Trading:
- By verifying tokens, Smart Trading will filter fake, scam, low-liquidity tokens or tokens with rug-pull ability to limit risks for users. Even so, users can still trade these tokens if they accept the warned risks.
- Through a liquidity pooling mechanism, Smart Trading will split users’ trades to find the best swap opportunities, across all AMMs on Fantom. As such, WingSwap DEX Smart Trading users are not only trading on a single liquidity pool, but all of the liquidity on the Fantom blockchain.
- Finally, bring the same trading experience as on CEX exchanges with Chart, Order book and custom order placement interface.
Going forward, WingSwap will continue to improve its Smart Trading product and integrate with other DeFi features and products to optimize profits for traders. By offering these groundbreaking products, WingSwap aspires to be a pioneer in the Decentralization of the financial industry.
WingSwap is a decentralized exchange built on the Fantom Opera chain that allows platform members to provide liquidity and create a market for others to exchange their original tokens.
Apart from this, the platform is created with multiple unique features such an exchange, NFT marketplace where users can buy and trade NFTs. With this, WingSwap is set to change the narrative and redefine the DeFi industry.
We envision an ecosystem where fast, easy, and affordable decentralized finance products and services that meet the needs of users are delivered in a timely, responsible, and sustainable way.
Apart from this, we project a platform that will be the forerunner of all DeFi products and use cases in the nearest future and easily accessible assets with more use cases that will drive adoption, increase demand and value.