Review on 0x by Benaiah A. Akinlade
0x: Reshaping the narrative of Ethererum blockchain
0x was co-founded by Will Warren and Amir Bandeali in 2016. It is an Ethereum based blockchain open source protocol that allows for decentralized exchange (DEX) of tokens and assets. It is a protocol that enables smooth P2P exchange of Ether tokens on the Ethereum blockchain. The protocol is intended to serve as an open standard and foundational block that drives operations among Decentralized Applications.
0x Ethereum token is (ZRX). The price of ZRX is USD 0.462168 USD (0.00004499 BTC). It is currently ranked 49th by Market cap, it has a trading volume of USD 332.88 and a maximum volume of USD 40.55. 0x capped the ZRX token supply at 1,000,000,000,000. Also, 500,000,000 ZRX tokens was sold to the public through an ICO for USD 24,000,000 in ETH.
The operators the exchanges and building on top of 0x are known as Relayers. They host off-chain order books and can decide to charge fees for the services they render, although users are not required users to pay fees to use ZRX. In order for the relayers to be paid, they must host and maintain and order book off-blockchain in exchange for their transaction fees. When the trade is settled, the fees are moved from the maker/taker of the smart contracts to the relayer upon settlement of a trade.
ZRX use cases can be categorised into two:
1. For paying trading fees to Relayers for the services they render.
2. To enable ZRX token holders to have influence on the 0x blockchain governance i.e the owners have authority, in proportion to the assets they hold, contribute to how the protocol should be developed.
Developers are able to use 0x to create personal applications for crypto exchange accompanied by numerous of functions, such as below:
1. It has the ability to transact trading (over the counter) of tokens issued on the Ethereum blockchain.
2. ZRX token is used by makers and takurami to transfer commissions to release.
3. ZRX tokens are used to implement a decentralized management of the 0x protocol update mechanism, to replace and improve underlying smart contracts.
0x provides a platform for you to exchange your tokenized assets like gold, stocks, real estate, video game items, and so on.
Trades on 0x are controlled by Ethereum smart contracts that are;
i. publicly accessible,
ii. free to use, and
iii. that any digital App can utilize.
The protocol does not impose costs on its users or collect tokens some users to benefit other users.
The main issues that 0x aims to address are the;
i. High cost,
ii. slow speed, and
iii. illiquidity of other DEX
These efforts were made in order not to go through the stress of recording every transaction i.e. new orders and adjustments on the blockchain. This indicates that the 0x protocol waits for all transactions to be settled outside the blockchain and then sends the orders to the blockchain to be sorted and settled.
The Solidity programming language is used to create this protocol.
The consensus narrative of the Ethereum blockchain is its high cost, and from all indications, 0x is trying hard to reshape this narrative
Pros
- It is a Decentralized Protocol
- Transactions are completed fast because it avoids the traffic of blockchain by completing transactions off-chain before sending to blockchain
- You can trade your tokenised assets like; gold, stocks, and real estate
- It provides good reward system for relayers
Cons
- Solely depends the Ethereum network.
- ZRX trading volume is still low
