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Automated order books eliminate DeFi costs and match CEX capability -Breaking

by Mike Robinson

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© Reuters.

Decentralized Finance (DeFiThe daily transaction volume continues to rise, despite the industry reaching unprecedented heights. Decentralized exchanges (DEXs), despite billions being transferred back and forth between them, are plagued by invisible and apparent costs that hinder market activity.

DeFi’s future requires that traditional DEXs have their transaction costs eliminated and offer limited functionality. Among them is slippage, the price difference between a cryptocurrency’s quote price and the trader’s actual paid price. In addition to the limited liquidity and high gas prices, there is also an inability to control execution price. There is also the possibility of fraudsters placing transactions ahead of traders based on their insider knowledge. DeFi can solve these problems and achieve parity to central exchanges (CEX), without the need for middlemen.

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