CEX vs. DEX debate never ends. CEXs offers user-friendly interfaces and fiat gateways, so people enter into crypto through CEXs only. But recently, the DEX ecosystem has really improved dramatically and they have started to offer a CEX-like experience and hassle-free trading. Newdex, launched in 2018, is one such DEX. It was the first DEX dedicated entirely to the EOS ecosystem and till now it’s the favourite destination of the traders who want to trade EOS tokens. Recently, Newdex launched its revised Whitepaper V 2.0 and it chalked out the plan to adopt multiple chains.
Newdex is definitely doing quite well. The smooth on-chain matching and settlement process of Newdex has created a satisfied user base and feeless transactions of EOS helped it heavily. The problem was with the liquidity of EOS DeFi. Uniswap’s success in the AMM (Automated Market Maker) model inspired many developer teams to launch their own AMM based DEXs. Newdex invested in Defibox, a successful AMM based DEX on EOS. People really like the permissionless swapping experience on the AMM DEXs nowadays and the liquidity mining incentives draw a lot of new users. The flipside is that the traditional order book based DEXs are really suffering after the emergence of so many AMM based DEXs. Newdex also saw its order book depth reduce drastically but it quickly innovated to become a DEX aggregator on EOS by combining the swap pools of the top two AMM based DEXs on EOS - Defibox and Defis Network. The liquidity crisis of Newdex improved temporarily but the DeFi activity started to expand into many other chains like Binance Smart Chain (BSC), Huobi Eco Chain (HECO), Polygon etc. apart from Ethereum. There is no doubt that DeFi won’t exist on a single chain down the line. The future of DeFi is multi-chain and it’s important to embrace the reality. Newdex has become flexible to understand this.
“Newdex is committed to taking advantage of the composability of DeFi to aggregate the depth of DEX in multiple chains, develop the aggregated DEX with ‘best depth, best price and best experience’, provide users with good decentralized trading experience, and become multi-chain DEX trading entry.” – Newdex Whitepaper V 2.0
BSC DeFi TVL growth – the recent dip is an effect of the market crash (from defillama)
Newdex will continue to develop its aggregate DEX on EOS but it’ll expand to other popular chains like Ethereum, Ethereum Layer 2, BSC and HECO. While Ethereum has remained the dominant blockchain for DeFi activity, BSC really surprised everyone with its growing popularity. Although the centralization of the chain was criticised, BSC DeFi activity grew exponentially due to its low transaction fee. Metamask compatibility was an added advantage as the Ethereum DeFi users found the ecosystem easy to use. It’s undeniable that BSC played a big role to bring retail investors to DeFi and created a new market. Newdex is planning to adopt BSC as the first chain in its roadmap to become a multi-chain DEX aggregator. The aggregated DEX for BSC will supposedly draw liquidity from Pancakeswap initially. The broad plan is to obtain full-fledged exposure to the composability of DeFi, aggregate multiple Swap depths, and integrate features such as order book, K-line, price market, token information etc. A big problem faced by the retail investors on the AMM based DEXs is that they face a lot of fake tokens and often get duped. Newdex has a plan to provide a comprehensive token information database and aggregate token information in the entire network so that the traders can make insightful decisions.
NDX to DEX swap progress as of now
Before entering into multi-chain DEX aggregation, Newdex has changed the tokenomics of its utility token NDX. It has been renamed as DEX and 100 NDX can be swapped to 1 DEX (100:1). DEX has a total supply of 100 million and Newdex plans to list the token in top tier CEXs in the near future. The holders of DEX get various privileges and VIP benefits on Newdex. The official blog post says that Newdex will do its best to increase token deflation and increase the value of DEX. Till now 88.11% of circulating NDX has already been swapped to DEX by the users and the swap activity will run until 17:00 (HKT) August 31, 2021. The users need to perform the swap themselves on Newdex platform and post the deadline, NDX will become a ‘Commemorative Coin’. Newdex’s BSC chain entry should happen very soon and we may see high liquidity mining incentives to bring new users. Mass adoption of DEX trading is bound to happen and Newdex is getting prepared to reap the benefits by adopting multiple chains so early. The new journey will start with BSC!
Note: This post was first published here for Cryptowriter.