Centralized Exchanges: are we finally ready to say goodbye?
Decentralized exchanges are here, but their adoption has been prevented by scarce usability. Until now.
Mt. Gox’s all time record of $460 Million cryptocurrency hack was only broken when, last January, Japan-based exchange Coincheck suffered a $530 Million hack in cryptocurrencies. In the past years, alongside this staggering figures, smaller, yet significant losses have interested a number of exchanges.
Were they the work of skilled hackers, inside jobs, or plain mismanagement cases, these episodes affected users all over the world, showing us one simple truth: centralized exchanges are the weakest link in cryptocurrency.
In this field, decentralization is not just a technological feature, but an ideal. Cryptocurrency’s very existence is intrinsically linked to the need for decentralization, as Bitcoin was created to overcome the hegemony of financial institutions that lead to 2008’s global crisis.
In a technology otherwise voted to achieving maximum decentralization, exchange platforms represent to this day one of the few centralized aspects, and, consequently, one of those which are subject to security issues.
These issues can be avoided by using a decentralized exchange (DEX), that does not have centralized deposits. This way users are always in control of their own funds, which cannot be stolen in hacks like the ones mentioned above, and they are also always responsible for them!
Why isn’t anyone using DEX’s then?
Do people just like being robbed? Well, no, but to this day centralized exchanges are often simpler to use and offer “real-time” transactions — which is not actually what happens, as it is more of an “illusion” since the coins are “registered” to have passed from one address (which belongs to the exchange) to another (which also belongs to the exchange). On the other hand decentralized exchanges are less user-friendly and force users to long waitings so that all processes can happen on-chain.
As a side note, let’s remember that people are not used to a full “financial responsibility” but rather to rely on a third party authority — like a bank — so they often feel comfortable in trusting a centralized exchange. Facts are proving them wrong every day, yet this kind of issue requires a shift in mindset that goes beyond technological solutions.
Is there a DEX that is quick and simple too?
Tokedo answers the need for decentralization with a hybrid structured DEX, that only decentralizes the “risky” parts of the process. Non-critical procedures, instead, happen off-chain, making the whole operation way faster than it is on traditional decentralized exchanges.
Users are not required to make centralized deposits or to give up the ownership of their private keys. At the same time, the orders are managed by an off-chain server, so that transactions can happen instantaneously, without having to wait for confirmations from the blockchain. Plus, the exchange is planned to be integrated into Atomax wallet — the wallet of the Tokedo ecosystem — so that users can trade coins within the wallet’s mobile app on their cell phone, for maximum security and optimal UX.
Thanks to Tokedo’s solutions, decentralization, security, and financial freedom finally meet usability.
Discover more about the Tokedo Ecosystem by reading the whitepaper.
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