Institutional liquidity provider Woorton announced during Paris Blockchain Week Summit that they will increasingly provide more liquidity on DEXter. DEXter is the first Decentralized Exchange (DEX) that has gone live on the Tezos blockchain. Since DEXter launched September 30th, total volume exceeded $1 million and the total amount of provided liquidity just crossed the $600K mark.
Currently DEXter has two trading pairs live: USDtz - XTZ and tzBTC - XTZ. (This will change soon.) Liquidity providers earn a portion of the 0.3% transaction fees on transactions that are made on DEXter.
Woorton is an institutional liquidity provider, and is currently providing liquidity on several exchanges, offering over 100 trading pairs. "We provide liquidity globally to the digital asset industry. Specialized in algorithmic trading and advanced technology, we thrive to provide the most efficient execution and the highest caliber of services, making markets more fair and accessible for all."
Woorton also is one of the tzBTC providers. tzBTC is a BTC - based token which is 1 : 1 backed by BTC. This makes it possible to trade BTC value on the Tezos blockchain. Advantages are simple: faster transactions (Tezos blocktime is 10 x faster) and cheaper transactions. Read this article for an explanation, using transactions on Atomex as an example. The same principle applies to tzBTC traded on DEXter. (Atomex is a HD Wallet and Hybrid DEX, build on Tezos making atomic swaps possible.)
tzBTC can be bought on DEXter or swapped on Atomex, or minted through tzBTC providers, called designated tzBTC Gatekeepers.
Advantages of DEXter:
For anyone trading XTZ for dollar- or Bitcoin value, DEXter has some big advantages.
Currently due to low volume at times, the prices on DEXter can be different from bigger volume exchanges:
@KMehrabi often points out these differences. You can make some interesting trades that way, profiting of higher fluctuation. And if you want to buy XTZ to add to your long term holding position, you can often buy XTZ on discount on DEXter. So if you plan to buy XTZ, you might want to check the prices on DEXter first.
The big difference between a centralized exchange and a decentralized exchange, is the fact that transactions on a DEX are made on-chain, so on a blockchain. As opposed to transactions on centralized exchanges, which happen on private databases and not on blockchain. This means that on centralized exchange, the exchange holds your coins for you, while on a DEX, you hold your own coins. (You also hold your own private keys.) DEXes are the ideal solution for buying and trading crypto without the dependency on third parties.
Since transactions on a DEX are made on-chain, transaction fees on the blockchain itself become a factor. Most DEXes are build on Ethereum currently, but Ethereum has one of the highest transaction fees, often over $2 per transaction.
This factor means that low transaction fees on Tezos are another big advantage. On average the transaction fees on Tezos are 3,000 times cheaper than on Ethereum. That means that you can make 3,000 trades on DEXter for the same price as you would make one single transaction on an Ethereum - based DEX.
What's next for DEXter
In the next few months "about a dozen new tokens will be added" on DEXter. Also data analytics will be provided in several different forms. Day to day volumes and analytics for liquidity providers will be made available soon. Data for individual liquidity providers are especially interesting, so you can see your rate of returns over certain periods instantly.
Also API's for institutional providers will come available, which makes it easier for institutional providers to add liquidity to DEXter trading pairs.
In this interview is explained how you can provide liquidity on DEXter as an individual.
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