Victor Ugochukwu · Dec 14, 2020 . 5min read
FTX to Build DEX on Solana Blockchain
SBF, the CEO of FTX hinted about this in one of his usual Twitter updates with the DEX platform dubbed Project Serum.
By Victor Ugochukwu · Jul 27, 2020 . 6min read
FTX, a Crypto Derivatives Exchange platform announces it is building a DEX platform for its users on the Solana Blockchain.
Sam Bankman-Fried, the CEO of FTX hinted about this in one of his frequent Twitter updates with the DEX platform dubbed Project Serum.
According to the CEO, Project Serum is a decentralized ecosystem built from the ground up to meet the world’s needs. The Serum is fast, cheap, and powerful, and fully cross-chain compatible. Also it’s genuine, and fully trustless. The DEX is interoperable with Ethereum.
Serum is built on the new Solana blockchain. Solana claims to be able to process 10,000 times as much as Ethereum, and it’s 1,000,000 times cheaper in fees. Unlike many side chains, Solana is a fully-fledged, decentralized blockchain with over 100 validators. This allows Serum to have full central order limit books, with the familiar market, limit, and IOC orders; processing multiple times per second; all while being fully on-chain. This is combined with a robust cross-chain protocol allowing for trustless and efficient tokenization and swaps. This means that while living natively on Solana, Serum is interoperable on Ethereum.
DEX volume on the rise
DEX volume has been growing since the beginning of this year. Volume across the various DEX platforms for July has crossed $2.5 billion looking like it might double the volume recorded the previous month. However, rising gas costs on the Ethereum blockchain impede user’s activities across these DEX platforms.
With FTX building DEX on Solana, it aims to capture some of the markets in the rising DEX activities.
Another critical factor is the intuitiveness of DEX platforms. Most DEXes are lacking in this utility which is why traders who care little about asset custody enjoy centralized exchanges. Uniswap’s volume may directly be linked with a highly intuitive interface. Sam Bankman-Fried’s tweet sheds more light on Serum in this area. Outlining Serum’s design, it will have stablecoin designs, tokenized products, a fast, secure risk engine, and a thoroughly modern exchange and financial ecosystem can live entirely on the blockchain. Together these let Serum’s users have the experience they’re used to on a centralized exchange. However, these will it’s all trustless and on-chain.
Lastly, Serum DEX will have its native token with the ticker SRM. It will be a Solana-based token of which 100% of net fees go to a burn of SRM. This will also afford holders get discounts on fees, and SRM can also be staked on nodes to help optimize the network’s performance.
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