Bitfinex To Introduce New Decentralised Exchange Ethfinex Trustless
Ethfinex recently blogged development plans for a high-performance exchange for decentralised trading, Ethfinex Trustless. The platform is being developed to overcome issues of trust that plague current centralised exchanges. A decentralised exchange will allow users to buy and sell cryptocurrency from their own wallets.
A centralised exchange must be trusted with the control of user currencies. These are generally held separate from the exchanges’ hot wallet in which a user needs to request for the trade to commence. An order to buy Bitcoin does not always reach the blockchain with these trades and they are generally credited to users’ accounts.
Delays can be experienced as the exchange has to action deposits and withdrawals. A user can only deposit and request withdrawals in which they must rely on the exchange to action and credit. Not all exchanges will update automatically using APIs for security and so a user can experience delays. A trader may look to buy Ethereum with Bitcoin on a centralised exchange but is required to deposit the Bitcoin prior to the trade commencing.
Ethfinex Trustless aims to improve users experience from centralised exchanges by not requiring signups and no need to deposit or withdraw without having to relinquish control of the asset. Ethfinex can achieve this by executing trades against a highly liquid off-chain order book. This off-chain allows users of Ethfinex Trustless to trade directly against the Bitfinex and Ethfinex order books, addressing current liquidity constraints of decentralised exchanges.
The Ethfinex Trustless platform will initially launch trading pairs against Ethereum and Tether with further pairings planned. Traders and users can use the platform at launch to buy Ethereum, OmiseGo and 0x with Tether.
A lot of centralised exchanges are developing new decentralised platforms that do not have central processing hubs or storage of coins which can attract hackers. These platforms can process trades straight from users’ wallets preventing the need to trust an exchange.
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