NEX is the first decentralized perpetual and spot exchange that allows users to trade assets on-chain on Near Aurora chain. Accessible without an account, KYC, geographic restrictions or high centralized exchange fees, users can start their trade by only connecting their crypto wallet (Metamask, Coinbase Wallet and WalletConnect) and experience a user-friendly UI & UX.
NEX differentiates with a focus on composability, tokenomics, risk optimization, and UI/UX. Building on Aurora enables NEX to have ultra-low transaction fees, greater capital efficiency and fast transactions.
What is NEX’s Vision?
NEX, Your Next Exchange.
We build the next generation exchange by optimizing the trading environment focused on user experience.
- Seamless asset transitions regardless of chains
- Fast & simplified on-chain trading
- Unlimited liquidity minimizing price impact and slippage
NEX Mechanics
Traders on NEX are able to perform asset swaps on NEAR, ETH, and USDC (more assets will be added). They can also leverage trade these assets in both directions by utilizing the assets in the pool.
For example:
- When entering a long on ETH, a trader is “renting out” the upside in ETH from the NIT pool.
- When entering shorts on ETH, a trader is “renting out” the upside of USDC versus ETH from the NIT pool.
All trading and investing at NEX occur based on the liquidity in the NIT (NEX Index Token) pool. NEX’s gaining a stronger liquidity profile makes it easier for traders to participate. As long as NIT TVL goes up, the protocol’s ability to handle more volume rises, and, in turn, fee generation that goes back to liquidity providers and the protocol increases.
NIT
NIT is NEX’s liquidity provider token. The NIT pool is a multi-asset pool that supports trading and allows users to long/short and perform swaps. In comparison to other DEXs where one can only buy and sell with impermanent loss, at NEX, less fluctuation and more stability through a hedging strategy is accomplished via NIT.
LPs can “mint” NIT tokens, which represent shares in the NIT pool, by deploying any of the index assets to the pool. They can redeem any index asset by burning their NIT holdings. The fees associated with buying NIT vary depending on which of the index assets are currently underweight/overweight. If an index is underweight, the fees for minting NIT by depositing these assets are lower and hence incentivized.
Instead of the standard Automated Market Maker model (AMM) (x*y=k), NEX uses the NIT pool in combination with dynamic aggregated oracle price feeds which will be sourced by Flux Protocol, a cross-chain oracle that provides smart contracts with access to economically secure data feeds, and a self oracle from multiple CEXs (Binance, FTX, Bitfinex, etc.) to determine the “true price” of an asset. This allows NEX to achieve the true price of an asset with far less liquidity. This also means that trades can be executed with zero slippage and LPs are protected against impermanent loss as the traditional AMM model is not utilized.
Fees & Rewards
There is a trading fee of 0.1% of the traders’ position size incurred when opening a position and closing a position. The borrow fee is the fee that is paid to the counter-party (NIT pool) of the trade at the start of every hour. Holders of the NIT token will receive the fees in USDC, a stablecoin. These fees will be collected for a whole week then distributed linearly on the week after.
Holders of the NIT token earn 70% of protocol fees. The other 30% is allocated to cover operational costs, considered as profit of the core entity operating the protocol. Note that the fees distributed are based on the number after deducting referral rewards and the network costs of keepers. Keeper costs are usually around 1% of the total fees.
Roadmap
NEX plans to scale vertically by continuing to increase market share on the Near Aurora chain. One of our priorities for 2022 is to consolidate our current work on Aurora. Various marketing and development strategies are being discussed and will be executed in the near future, such as referral programs.
NEX has plans to scale horizontally by deploying our contracts and expanding into the overall NEAR ecosystem. Starting from Q4 of 2022, we are planning to become a decentralized multi-chain spot and perpetual exchange. There are plenty of chains to expand to with a large user base and NEX can instantly tap into this base on deployment. The focus will be on low transaction fee chains that have high throughput.
A more detailed roadmap is as follows:
- [2022 Q3, early July] NEX Beta Launch
- [2022 Q3, early July] Audit
- [2022 Q3, end of July] NEX Launch
- [2022 Q3, Aug] Scaling on Aurora
- [2022 Q3, Sept] Expand into NEAR Ecosystem
- [2022 Q4, Oct] Governance
- [2022 Q4, Nov] API
- [2022 Q4, Dec] Spot
- [2023 Q1, Jan] Integrate Spot & Perpetual
- [2023 Q1, Feb] Synthetics
- [2023 Q2, June] L2 or Interchain
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