The 0x protocol is a peer-to-peer trading network that allows for the direct exchange, without intermediaries, of blockchain assets. It’s a decentralized exchange that operates slightly differently to a classic AMM model, as buyers and sellers are connected directly in most instances, rather than interacting with a larger liquidity pool, with the AMMs conducting trades for two parties. Transactions are also done offline before being sent to the Ethereum network for validation, allowing higher throughput of transactions and faster speeds than the Ethereum network could achieve natively.
What Does 0x protocol Do?
As well as acting as its own trading network through the 0xmesh, the 0x protocol allowed Ethereum tokens to be swapped using any decentralized exchange which was using the protocol. Thus, individuals could quickly set up their own DEXs, with their own pools, trading pairs and rates, using their development tools and have capital access them easily. Also, because these DEXs can integrate the 0x API, they can access networked crypto liquidity pools to augment their own. Matcha is their global search engine for liquidity and allows users to navigate a myriad of protocols and find the right price for their assets.
What this does is generate a flourishing market that is more seamlessly interconnected (within the Ethereum ecosystem and 0x protocol users) and traders are less likely to suffer slippage and more likely to execute their trades at the prices they seek. The liquidity aggregator can search exchanges to fill orders with the lowest slippage possible. The downside is that some ETH is required to make use of the network. Several successful products have been built on this “craigslist of DeFi” including Zerion, DeFi Saver, Nuo and Radar Relay.
How Does 0x work?
The hybrid nature of the off-chain relay with on-chain settlement architecture is the main thing that sets the 0x protocol apart. Ox does not actually store orders on the blockchain, but uses an off-chain mechanism to collate its swaps. The settlement, of course, occurs on-chain – so security is achieved. Yet this allows for multiplicative gas efficiency and makes the protocol extremely flexible in the way the API then plugs into a variety of different DEX’s.
Makers of 0x orders can specify their desired counterparty. So if you have met someone in the street and want to trade with them, then you can send them the proposed trade through the network. If no counterparty is known, then users can submit to the 0xmesh that helps match buyers and sellers one. These relayers are not trusted middlemen and don’t execute trades. They just help create the order book that is then fed into the on-chain settlement.
Takers can browse or receive orders from these relayman and then settle the transactions they are happy with. Once the protocol verifies everything is as it should, the tokens are traded through the use of atomic swaps, appearing in each other’s wallets. The key usefulness of this peer-to-peer network is that traders can swap whatever tokens they choose. Otherwise impossible pairings like PAXG and random day-old food coin can be traded between assenting parties seamlessly without having to create a traditional pairing on a DEX or find somewhere that offers such a unique trade. It opens up more possibilities for unique P2P trading. The protocol’s own 0xmesh can allow users to fetch quotes for whatever they desire, and offer anything in return.
What is the ZRX token?
The ZRX token is the protocol’s native governance token. They refashioned their tokenomics to encourage holding and staking by offering financial incentives to liquidity providers. Those who stake ZRX get a liquidity reward funded through a fee that’s charged for using the network. It’s paid out in ETH which is accumulated over “epochs”.
When each epoch ends, ZRX holders are paid out from the accumulated pool. Large holders can also create staking pools for other users to join, but those users will only get half the voting rights on the protocols direction so it’s important for stakers to choose their market maker’s carefully. But this remains a smart way to generate yield without having to lock your tokens up long term. As 0x’s rewards system is dynamic, the interest in various pools can vary considerably depending on the state of the market.
0x protocol markets itself as the “liquidity endpoint for DeFi”. It has begun expanding its reach beyond Ethereum and onto other blockchains like BSC. It helps you seek value and trade directly in the blockchain space, and it looks to grow in the premier multi-platform p2p trading market in the crypto economy.
Is ZRX Hard to Get?
Getting cryptocurrencies, whether by purchasing or trading, can be a daunting prospect for beginners. This is particularly true for any cryptocurrency that isn’t Bitcoin or Ethereum – with Ethereum tokens, also known as ERC-20 tokens, such as ZRX being a prime example.
If you are thinking about getting ZRX then Numio is a great choice for handling your assets. Numio allows you to pay people using your stored ZRX assets, as easily as if it were cash. If you are a bit more crypto savvy you can also trade and swap ZRX at the touch of a button.
Download Numio to get 0x
How can I get ZRX?
There are multiple ways to get ZRX on Numio. You can purchase ZRX with your credit or debit card, you can trade it for other ERC-20 assets (up to 100x cheaper than other wallets), or you can receive it as a payment. Whatever way you choose you can be sure that you are always in full control of your ZRX.