Review on EtherDelta (ForkDelta) by Fabrizio Zampieri
EtherDelta operates as a decentralized cryptocurrency exchange that…
EtherDelta operates as a decentralized cryptocurrency exchange that specializes in Ethereum and ERC-20 tokens, the site acts as a marketplace that facilitates the trading of ETH for almost any token compatible with the Ethereum network.
EtherDelta launched in 2017 after being founded by Zack Coburn and the decentralized trading platform soon became a hub for traders of Ethereum and any ERC-20 tokens. The exchange utilizes smart contracts that are responsible for managing deposits, trading, and withdrawals once a user has successfully integrated a personal wallet with the site so users do not need to open an account on the site (site only requires a user to integrate a wallet on the site).
The recent hack and actions of the new management team, who has chosen to remain anonymous, have eroded a lot of the confidence built up by the previous team. It’s currently not known what plans the new management have for the exchange and just what measures they are taking to secure the site from any future attacks. This lack of trust has led to the emergence of the ForkDelta project which aims to run an exchange in keeping with the former practices of the exchange.
Pros
- - EtherDelta operate as a decentralized exchange and this provides users with more options regarding how they choose to use the sight and how they opt to store their funds. Users are not required to open an account with the site and can just integrate already existing wallets. - The exchange acts as a home to almost every ERC-20 token in circulation and users can find tokens on EtherDelta that are often difficult to track down elsewhere. For users looking to trade tokens based on the Ethereum network, EtherDelta has a wide selection. - Users are able to add new tokens to the site by just inputting the necessary details and tokens that have just been released from ICOs are often first listed on EtherDelta. This responsiveness has attracted many traders to use the site. - EtherDelta’s use of smart contracts and personal wallet integration make it one of the most secure exchanges in operation today. In addition, the exchange uses a number of servers and does not require users to set up accounts or to hold their funds on the exchange. Funds are transferred from existing wallets and held within an account based inside the exchange’s network (however in December 2017, an individual hacked EtherDelta’s domain name, and performed a phishing attack on its DNS server. The hacker compromised the EtherDelta website, and swapped it for a false version of the exchange. The hacker was able to steal around 305 ETH, worth over $244,000 at the time).
Cons
- - Due to its decentralized nature, EtherDelta actually performs every single trade, using smart contracts to facilitate the trading. On top of this, the site depends on the Ethereum network, which moves very slowly in the event of a serious backlog. Transactions can take hours or days when the network is clogged up. - Ether Delta platform is not very user-friendly. It’s common for users to make costly mistakes when using the exchange. - Ethereum remains the base currency on the site and all the tokens on the exchange are paired against ETH. Also, only ERC-20 tokens are supported and currencies such as Bitcoin, Bitcoin Cash and Litecoin are unavailable.
