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Ox is an open protocol that is designed for the creation of a decentralized exchange. Ox exists on Ethereum and it is powered by smart contracts. The team that created this protocol has a belief that it presents the future of the crypto space. This protocol encompasses the best of existing centralized and decentralized exchanges.
What Ox Hopes to Achieve
When the co-founders of this project came up with it, they wanted to create a platform where every asset could be represented on the Ethereum blockchain. The assets they envisioned being represented included gold, fiat currencies, shares, and even gaming items. They also envisioned a trustless platform where these tokens could be traded. While they liked the concept of decentralized exchanges, they felt there was room for improvement. They hope to address the shortcomings of decentralized exchanges as well as make them interoperable.
How are Centralized and Decentralized Exchange Different?
The most common type of crypto exchanges are centralized exchanges. They are owned and run by a private entity, which leads to a lot of risk. To reduce the issue of theft, decentralized exchanges were created. On these exchanges, a user maintains full control of their crypto assets. To authorize a trade, users rely on a digital signature. However, these exchanges are usually slow and they have limited tools for trading.
How Ox Improves Decentralized Exchanges
The Ox project wants to improve how decentralized exchanges work. The main challenge that faces these exchanges is expense, illiquidity, and speed. Besides that, these exchanges are not interoperable. To conduct transaction relies on block times. Additionally, there is a network fee for each transaction.
Ox addresses these challenges by creating a standard protocol. This protocol can be used on all orders that are relayed off-chain. The protocol ensures that each order goes back to the blockchain when it is settled instead of sending each transaction to the blockchain. It helps to speed up transactions while reducing unnecessary fees.
The Cost of using Ox
Since Ox reduces the transaction fees, the project can charge a fee to users. However, it does not charge any fee for anyone to use the protocol. However, if a Relayer opts to create a decentralized exchange using the protocol, they could charge a fee.
About the Ox OTC
Besides the Ox protocol, there is the Ox OTC. The Ox OTC makes it possible for peers to exchange Ethereum tokens without the need for a Relayer. However, they need to directly connect with a counter-party. To use it, you need to send a link to a counterparty to generate and send an order. You can send your order however you like since it is relayed using blockchain technology.
The ZRX Tokens
The Ox project also comes with the ZRK tokens. These tokens allow users to pay Relayers’ fees. Essentially, those that hold the ZRK tokens have a say on the improvements of the project based on the amount of ZRX tokens that they own. There are one billion ZRX tokens with 15 percent being used as part of the developer fund.