We need a truly decentralized derivatives trading platform

Can job seekers continue to follow the spirit of the open and shared Web3 as the governance process gains business monopolies and reap many benefits?We can say that the recent achievements of the Opensea team have taught us important information.

For the founding team of Openea, I have to say that the IPO on Wall Street is a great way to protect the fruits of victory after the deal they themselves created has gained many benefits. . However, the crypto community that supports Opensea as a whole and its name for early users of Openea means that the future of Openea will inevitably begin to look for good results more than supporting the NFT community and building the crypto ecosystem. . This is a complete reversal of the openness and cohesive nature of Web3.

For many NFT users who have suffered from the effects of the Web2.0 monopoly, the new home builder who sits on the ground and collects rents seems rare to them.

But what really worries doctors is that this phenomenon is not particularly happening in the field of NFT industry. A similar story is told around the same time of the stock market, which is also the time of the explosion.

Are you really using DEX?

Currently, the platform with the highest volume of running derivative transactions is undoubtedly dYdX. Before using dYdX, users only need to deposit money from the chain wallet, and the following process and payment does not have to deal with the wallet and pay for fuel. Moreover, dYdX is almost identical to knowing the principles of fast payment and efficient exchange. What many consider dYdX to be a leader in DEX equipment is its versatility in relation to the use of mid-market.

The problem, however, is that such a user experience against the base of the platform will certainly sacrifice the most important decentralization product of the Web3 application. So how do you centralize the dYdX infrastructure?

In other words, it centralizes (the connection jobs) enough to directly access Amazon Cloud Service, a dedicated IT unit in Northern Virginia, USA. Not too long ago, on December 7, many trading platforms such as dYdX and Coinbase were suspended for several hours due to major outages in Amazon's cloud services. This weather service clearly indicates the level of centralization of the dYdX.

It can be seen that similar industries such as dYdX do not respond to the latest Web3 application model. So what must be done in order to reach the real DEX? In my opinion, at least the following conditions should be met:

1. Actual chain transactions:It is only by keeping sensitive data on-line that the safety of our customers can be protected.

2. Meaning book system:Yes, the current mechanism of the mainstream AMM industry can not support the chain product market. In the derivatives trading industry with high demands on high frequency trading, we believe that only manual accounting matching mechanism can meet user needs.

3. Fair trade control mechanism:Many attacks like preemption and robotic arbitrage must be avoided by using technology so that ordinary users have equal access to doing business with robots, scientists, etc.

These traits are valuable assets that the immunization program has retained from day one of its inception. So what exactly is the Injective technology used to make this product strategy a reality?

Architecture of the injection process

Compared with most of the injection molding industry in the modern industry, injection molding has adopted a completely different technology. Therefore, in order to better understand the different functions of injections, it is necessary to understand them at the basic design level.

(1) Chain application

First of all, Injective decided to establish its own public independence to complement top-level applications. It should be noted that most of today's industries are based on smart contracts, mainly because smart contracts are easier to build than public channels. However, when market demand explodes, smart contracts are often constrained due to bottom line performance, resulting in higher exchange rates for consumers. .

From the start, Injective has taken the right path to create its own chain for the industry. This will allow users of specialty chemicals to benefit from the performance of the entire chain, as well as allow the team to adjust fuel costs and financial policies as needed, available on request. Only then can Injective be sure that it can directly take over the order comparison process that users need quickly.

At the same time, Injection decided to integrate Ethereum's EVM environment directly into public channels. The best benefit for users is that users don't have to go out and set up a new wallet and store new private keys like other new chains. People only need to use MetaMask's existing Ethereum address to create a direct deposit account. Enrollment in the next industry can also be done directly through the Ethereum process, reducing the initial injection of new injection chains to the public.

In addition, choosing the right chain of trust for the public is also an important part of the technological choice. Here, Injective directly uses the Cosmos SDK to deploy its cross-chain code for development. This option is particularly evident when the cross-chain requirements are very strict today.

(2) Cross the Chain Cross Bridge

The choice of technology for the application of the injection chain in conjunction with the heritage is more problematic. Unlike Ethereum smart trading contracts, which allow you to trade assets directly from Ethereum, almost all Injective assets must be crossed to reach the Injective chain. .

Therefore, we need to build enough bridges to bring more users and events into the ecosystem. Fortunately, Injection, made up of the top of the Cosmos SDK, is still compatible with the IBC, most devices in line of sight connected today. Currently, the Injective Bridge project has been successfully connected to the Cosmos Hub and Terra ecosystems of the IBC protocol. Bridge Injection also integrates with Peggy Bridge technology to support the Ethereum ecosystem and cross-functional assets.

The integration of the chains represented by the Injective Bridge will strengthen the partners that Injective can support in the future.

(3) herbal injections

As mentioned above, as a chain of civil society. The nature of the Injective ecosystem is complex, comprising not only the contract and management modules required in the public chain, but also trading components such as the cross chain, web wallets, and trading interfaces. . As with other public channels, setting up separate domain names and web pages for each feature will increase the user experience.

To this end, Injective has developed a comprehensive guide that combines all of the features mentioned above and combines the features that every user should use in one integrated Injective Hub.

As can be seen in the screenshot above, users can get all the user service portals involved in the Injective ecosystem in the Injective Hub store, making interacting with the public channel simple and intuitive based on a smart contract.

(4) Modèle FBA (Frequent Batch Auction)

The typical batch auction model seems far removed from the average user, but we still need to focus on it. This is because FBA's built-in trading mechanism seeks to solve one of the biggest problems for cryptocurrency traders: preemption.

Here, without discussing complex strategies, we briefly list some of the rules of FBA.

1. Further divide the process into different parts and complete the product on time.

2. All orders in a single unit of time have an exchange rate.

3. Hide the bid price to protect the trader himself.

It can be seen that the injection does not directly use the cost-effective and quick decision to compare the process in the traditional industry, but still hope to solve the problem. .

In FBA trading mode, strategies such as preemptive trading and high frequency trading arbitrage from traditional trading platforms are no longer used. For modern traders, this means that more arbitrage traders will redistribute the profits once received to end users, and users will get a better return on their investment.

Of course, the principle of special use is more complicated than the description above, and due to space constraints, I will not go into it in detail for the reader.

(5) Insurance fund

In all derivatives in the industry, better risk management is the key to a long-term security platform. Injective injection of the proceeds of the liability procedure into the insurance contract to prevent the parties who have lost business by not paying the beneficiaries. In the event of a change in the weight value, so that the contract works in accordance with the weather forecast . .

At the same time, consumers can also choose to invest their money directly in certain stores to purchase insurance in order to gain greater commitment. There are several measures that can make Injective's performance more robust and protect end-user preferences as much as possible.

The Ecology of the Objective

Although Injection is not an open chain of smart contracts focused on green development, Injection has not adopted a closed-loop design concept that allows companies to monopolize the infrastructure of all applications in the chain. For example, Injective has chosen an ecological open source concept that is more decentralized and more in line with the spirit of Web3.0, and the ecosystem created for this is also called the Relayer Ecosystem.

Relay is an independent ability to relay commands from users and can of course be understood more easily than other front-end exchanges.

Specifically, Injective has been selected to open the frontend, and in addition to the Injective Pro business frontend apps, users can also choose another front end switch developed by another manufacturer to get more personal business. Currently, the Injective Hub range offers a total of five preset exchanges, including Injection Pro, giving users the freedom to choose.

Although users can use different interfaces, all interfaces display revenue from a shared order book. In addition, different interfaces can be adapted to different policies and take into account the use of different users.

token industry

(1) The resulting distribution mechanism

Like the tokens offered by several trading platforms, Injective accepts a kind of redemption platform tokens with income. In particular, 60% of the total exchange rate was used to redeem and destroy platform tokens held by INJs. (The remaining 40% are distributed to the nodes of the relay ecosystem)

Like share buybacks, this model is discussed at length in traditional financial theory. In other words, the profits of a listed company buying back its products for cash are no different from those distributed directly to shareholders. In other words, by adopting a profit buyback model, Injection offers pure financial support for the value token compared to other trading platforms such as the pure control tokens of dYdX.

Thus, traders can also estimate the value of the token using existing models such as discount models for future cash flows. In conclusion, this model, which supports the value of the token from the income, is a cost-effective design with low but zero reliability.

dYdX, on the other hand, has decided to transfer all of its market value to a key company called dYdX Trading Inc. DYDX token keys can only be held with dYdX administrator rights. Please note that this is a contractual rule and not a regulation of dYdX Trading Inc., the intermediary company. In other words, the income from the dYdX contract has nothing to do with maintaining DYDX.

Following the initial public offering of OpenSea, dYdX will one day resell dYdX Trading Inc. for marketing. I don't think this will surprise many people.

A special note here is that UNI provided by Uniswap is also a management symbol that does not distribute income, but the main reason is that the exchange rates are caused by the contract that has to pay the financial service provider for its stability. To lose. It's completely different from moving dYdX to a small house owned by a central company.

(2) Astro Plan

After the Injective mainnet went live, the team announced a similar financial support plan, also known as the Astro plan. The government provided participants with an ecosystem with 10% of the total number of tokens as an incentive for distribution. Of this amount, 30% is distributed to professionals and the remaining 70% is distributed to general customers, and the process of financial support is maintained for 5 years.

At the same time, the platform will benefit from a better exchange rate when it upgrades to the VIP level based on users' exchange rates and INJ commitments over the past 30 days.

Of course, due to space constraints, it is not possible to explain the details of the holder one by one.

Xaus

After years of intensive development and testing, we have finally announced the completion of the Injective backbone. From small demos of early hackathons to the public channels of today's mature trading platforms, Injective has always followed the principles of openness and decentralization.

At a time when many policies are closely tied to centralized technological processes for better market performance and efficiency, the injective arguments for reliance on blockchain to develop product marketing and the recognition of open integration of Web3 are commendable. It is believed that as the market grows, the market will eventually be rewarded for the contracts that are really worth it.