Blockchain technology and industry development
As we mentioned on several occasions, decentralized finance is organized in decentralized exchanges, called DEX for its acronym in English. These can be thought of as exchange markets similar to stock markets or foreign exchange markets such as Forex. However, unlike DEXes, DEXes have the ability to incorporate multiple assets and endless forex trading on the same platform.
The main feature of these exchanges is the implementation of the internal working schemes based on blockchain technology , especially regarding the second generation and smart contracts .Uniswap clone script,
Thanks to this, these platforms can dispense with traditional intermediaries and offer the comfort and immediacy to which the Internet user is accustomed.
Being a financial practice, the developers of this type of exchange platforms use the requirements of the activity in terms of technical analysis , market indicators and investment mechanisms .
They represent, in essence, an advance of a mercantile and competitive nature , since the performance of operations is much greater on this type of platform, and the user thus has a direct command center.
There are several types of decentralized exchanges , categorized into generations of blockchain technology:
In the first case, these are financial assets in which their value is directly related to the value of some other asset that they take as a reference. This type of instrument has no limitations whatsoever and is very useful for achieving the same performance and profitability as other securities to which you do not have access.In the second case, DeFi have the ability to carry out operations with index funds (ETF). This means that funds are generated in which assets are acquired on a diversified basis that allows reducing the risk on the total investment and improving the return on capital and the income obtained .
While there are ways to trade decentralized finance directly , most users and small investors do so through decentralized exchanges, trading platforms where all kinds of orders and transactions can be executed .
What are decentralized exchanges
As we mentioned on several occasions, decentralized finance is organized in decentralized exchanges , called DEX for its acronym in English. These can be thought of as exchange markets similar to stock markets or foreign exchange markets such as Forex. However, unlike DEXes, DEXes have the ability to incorporate multiple assets and endless forex trading on the same platform.
The main feature of these exchanges is the implementation of the internal working schemes based on blockchain technology , especially regarding the second generation and smart contracts .
Thanks to this, these platforms can dispense with traditional intermediaries and offer the comfort and immediacy to which the Internet user is accustomed.
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Being a financial practice, the developers of this type of exchange platforms use the requirements of the activity in terms of technical analysis , market indicators and investment mechanisms .
They represent, in essence, an advance of a mercantile and competitive nature , since the performance of operations is much greater on this type of platform, and the user thus has a direct command center.
There are several types of decentralized exchanges , categorized into generations of blockchain technology:
The first generation is the one that corresponds to the creation and operation of Bitcoin , the original cryptocurrency. In this case, they are less decentralized exchange platforms, frankly, than the following. This is due, more than to technical possibilities, to market conditions: in general, they were only used to carry out purchase and sale transactions and deposits .Only with the second generation of DEX platforms are smart contracts implemented for the first time .
These are based on the execution of actions and protocols based on agreements between users . Said agreements are made automatically once the block chain registers certain previously established conditions .Finally, the third generation blockchain incorporates a new functionality to the implementation of smart contracts: these are operations in which the cryptocurrency funds that the user has available never leave their account . Instead, these are considered as a guarantee of the transactions that they carry out on the exchange.
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Best performing exchanges in the market
The current picture is quite encouraging for certain exchanges that seem to have reached, for whatever reason, the first place in their various disciplines. In this sense, the following is a list of the best rated DEX of the moment .
Curve
This decentralized platform is, today, an industry standard. It supposes, first of all, the possibility of carrying out trading operations of all kinds . It is a platform that combines this multiple functionality with an equivalence of assets with traditional currencies .
This exchange also has the ability to invest in liquidity pools , which operate as funds whose purpose is to offer financial services to third parties and therefore obtain an economic return that depends on the amount of money contributed.
The platform is not suitable if you are looking to trade cryptocurrencies ; it focuses on maintaining liquidity on the platform and that the assets circulate between different tokens of the same currency .
Pancake Swap
In this case, this exchange works through Binance Smart Chain , a blockchain ecosystem developed by Binance for this purpose — to host various DEXes — . Its popularity lies in the large number of operations available and the cheapness of its commissions .
In essence, Pancake Swap is a decentralized platform that has a multitude of assets and investment options . The platform’s tokens serve to facilitate the circulation of liquidity and the exchange of the large number of assets that are traded daily.
Uniswap
The main advantage of this platform is its ability to operate with a series of Ethereum tokens that constitute value relationships between a certain cryptocurrency and a certain token . These are known as ERC20 and are used as financial assets within exchanges.Uniswap clone Development.
The liquidity that users contribute to the system takes the form of its native token , the uniswap (UNI). This can be used within the platform as a payment method or represent benefits and income based on the available liquidity pools. This, coupled with the ability to trade other ERC20 criteria tokens , has made it very popular with users.
SushiSwap
It is an exchange platform that serves, as in the previous case, to exchange Ethereum tokens of the ERC20 protocol . In effect, the functionality of both platforms is very similar, although SushiSwap also has other ways to add benefits and improve your return on investment .
For example, the practice of yield farming — profitability resulting from the mining of cryptocurrencies and crypto assets — is developed much more efficiently than in the case of Uniswap. The native token of this platform, however, called sushi , generates liquidity, but not governance ; that is, it does not grant the right to vote on the decisions implemented in the exchange.
MDEX
This DEX platform is one of the largest in terms of trading and exchange . In short, it is a cross-chain exchange initiative, in which transactions between the main blockchain networks in the market can be supported.
The idea behind this platform is to provide convertibility services between different currency pairs and digital assets without losing value on the same exchange . The system has its own token, which allows it to generate pools of liquidity and carry out agile exchanges and trading .
1inch
This exchange has several of the features seen so far, although what characterizes it is its activity as a search engine . It is a deal finder that constantly analyzes the deal flow to get the best deal in real time .
The competitive advantage of this DEX is essential for more experienced users , as it allows them to anticipate trends and invest accordingly . It often makes the difference between a marginal return and a significantly higher one.
It also has a governance token , capable of contributing to liquidity pools and yield farming or staking .
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