FUSOTAO PROTOCOL: A NEW PARADIGM FOR ORDER BOOK DEXes ON NEAR

Home to one of the first Order Book-powered DEXes in the NEAR ecosystem, Fusotao is a Substrate-based verification protocol for decentralized exchanges that operates on an innovative paradigm of “execute off-chain, verify on-chain”. This guide takes you through the protocol’s master solution to building more secure and efficient trustless DEXes, its main features, and the first look at its native Order Book DEX, FxDx.

Fusotao, an innovative paradigm for more efficient, secure, and cheaper matching systems

DEX platforms are increasingly taking a page off the centralized exchange (CEX) playbook by going for Order Book-based frameworks over automated market makers (AMM) to avoid high gas fees and latency that come with executing trades on-chain. Most Order Book frameworks run on matching order systems, which allow users to price orders (one of its advantages over AMM). However, security becomes an issue because off-chain verification requires users to cede custody of their account momentarily to a matcher (mutator), who mutates the data to match orders. Relying on human trust is one of the drawbacks of traditional systems.

Fusotao as a protocol (set of rules that govern a system/chain/blockchain structure) operates on the principle of executing off-chain, much like a CEX, but then implements a twist by verifying on-chain, which completely avoids human trust by using a PoM sub-protocol and maintains decentralization by leveraging Substrate.

Substrate is a permissionless interoperable framework for building blockchains that can submit proofs with zero-cost cost and low latency. The result is a trustless verification that does not require an account owner to cede ownership of their account to a matcher/mutator, but rather only mutation rights.

This innovative paradigm of “execute off-chain and verify on-chain” will be the foundation for the next generation of DEXes, essentially offering the best of both worlds — The security of traditional on-chain DEX and the speed and efficiency of CEX off-chain properties.

Fusotao Features

Verification appchain

Operating on the paradigm of “execute off-chain, verify on-chain”, the Substrate-based appchain runs on the Octopus Network. It will be the foundation for faster, gas-less, more efficient, and more robust trustless matching systems for Order Book DEXes built on Fusotao. The orders from users will be executed and proved off-chain by Fusotao’s unique technology, Galois, and then verified on-chain through a PoM consensus. The appchain is by default interoperable because it runs on the Octopus Network, which also ensures security through its leased security (LPoS) system.

Wallet extension

Fusotao has a native wallet, TokenKeeper, to initially run on Chrome and Firefox once released. However, the wallet is in the final stages of development, and early users will have to build (git clone) the git repository using Git and node.js (yarn) until the official release.

$TAO

This is the native token of the protocol, and its use cases are;

• governance
• staking
• trading rewards
• gas fees

The token will be progressively unlocked over five years after the mainnet launch, with a planned 48% reserved for trading rewards, 7.5% for validators and another 7.5% for staking rewards. The initial supply of the token will be done through airdrops and community rewards for early users.

FxDx

This is the Fusotao-native Order Book-based DEX that will launch alongside its mainnet. You can start trading on the DEX by connecting a Polkadot wallet with TAO tokens or USDT and Near derivatives; mUSDT and mNear.

Avatar Messenger

Drawing inspiration from the NEAR Rainbow Bridge, Avatar Messenger is Fusotao’s trustless component bridge that allows for interoperability with NEAR via the Octopus Network. The bridge is deployed as a light client of Fusotao on a smart contract through the Octopus Network. On the Fusotao side, a built-in integration on the Fusotao runtime and a relayer permit blocks to be relayed conveniently between the two protocols.

Getting started with FxDx

1. Main Interface & Connecting wallet

FxDx connects to a Polkadot wallet and opens on the “Exchange” tab.

Make sure your polkadot wallet extension is installed on the browser.

To connect your wallet, go to the top right of the page and click on “Connect Wallet.”

On the popup window, select “Polkadot wallet.”

Your polkadot wallet name and key will appear on the next page with a prompt for your password. Input the password of your polkadot account, not the passphrase.

Make sure to click on “Remember my password for the next 15 minutes”, else you may keep getting error messages.

After successful sign in, you should see your wallet key on the top right hand of the page.

2. Your assets

Click on the “Assets” tab next to “Exchange” to see your assets. Here you can see your assets, authorize (transfer) tokens to your Fusotao address, and see your orders.

3. Trade

The available trading pair is TAO/mUSDT. The Buy/Sell column is on the left of the page, and on the right, you can see the price chart, the book, and ongoing trades.

Fusotao’s Proof-of-Matching (PoM) sub-protocol sets it apart from other chains and protocols by leveraging the zero-cost, low latency, permissionless and decentralized properties of the Substrate framework. This, coupled with the protocol’s unique off-chain executor and prover, Galois, guarantees instant transactions with zero gas fees and forms the backbone of Fusotao’s one-of-a-kind approach to building the next generation of DEXes. Moreover, it puts Fusotao strides ahead of other verification protocols.

About Fusotao

Fusotao is a verification protocol for Order Book-based DEXes with matching systems, which operates on an innovative paradigm of “execute off-chain, verify on-chain”.

Fusotao is currently preparing for a huge testnet launch, and early users can be part of the airdrop or get rewards. Join their community on Discord or follow on Twitter for more news.

About Octopus Network

The Octopus Network is a multichain cryptonetwork for launching and running Web3.0 cost-effective leased security (LPoS) and interoperable application-specific blockchains known as appchains.

Find out the latest on Octopus Network or be part of their bustling community on Discord, Telegram, and Twitter.

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