DeFi is booming as the world warms to the advantages of decentralized crypto exchanges, or DEXs, over their centralized counterparts. DEXs offer anonymity, user control, and greater safety from outages, hacking, theft, and manipulation. But for these platforms to truly succeed, something more is needed.
So what is that secret extra ingredient? It comes down to usability.
To thrive, a DEX must address the real and perceived disadvantages of decentralization: lower liquidity, higher volatility, and, to some, bewildering complexity. In other words, the DEXs that will come out on top are those that have nailed customer experience.
Great customer experience is more than just the latest corporate buzzword. It is a requirement for long-term growth in all manner of businesses, from low-tech to cutting-edge. And at DODO, we believe top-notch customer experience is the product of both careful design and of willingness to adapt quickly to changing needs.
We have emphasized these beliefs in building a platform that offers all the philosophical and operational advantages of a decentralized exchange, coupled with the liquidity, simplicity, and customer centricity of centralized marketplaces. And we will keep evolving to ensure all this stays true.
There’s a lot in that promise. So let’s take a moment to unpack it.
First, there is liquidity.
One of the reasons centralized crypto exchanges have had a head start in attracting investors – particularly those new to crypto – is they look and feel like traditional order book-based asset marketplaces. Investors hand over their funds to a third party, which executes transactions on their behalf, based on the prevailing market price.
Since liquidity on centralized exchanges depends on the number of buyers and sellers prepared to make deals at any given time, more popular exchanges are more able to provide fast transactions close to the prevailing price, thus lessening volatility and risk. In effect, a self-reinforcing circle.
Until last year, when a surge of interest in Decentralized Finance ate away at centralized platforms’ volume lead, DEXs had to use technology to boost liquidity in the absence of the vast numbers of counterparties on centralized exchanges. Most relied on what are called automated market makers (AMMs), where smart contracts are used to store pools of tokens provided by users in exchange for incentives. Unfortunately, AMMs have been plagued by a pair of problems: slippage and impermanent loss.
Slippage is the gap between asking and realized prices – a common issue in illiquid markets when deals cannot be completed without major price concessions on one side or the other. Impermanent loss comes when those providing liquidity lose out on money-making arbitrage opportunities because their tokens are tied up in liquidity pools.
So DODO developed the Proactive Market Maker (PMM), a flexible and customizable tool that draws upon a ground-breaking algorithm to provide liquidity levels as high as those on centralized exchange without the downsides of other AMMs. The PMM uses off-chain oracles to scout accurate pricing information about each asset. It then ensures the bulk of liquidity is provided near this level, with reduced availability further out to discourage trades that diverge too far from the market price. In this way, PMM makes transactions faster and simpler and reduces the huge swings that can put off even the most risk-tolerant liquidity providers.
DODO also offers the SmartTrade trading and aggregation system, which finds and compares various liquidity sources to find the best prices between any two tokens.
Still, to ensure DODO would work for a wide spectrum of users, we knew it was essential to create an equally diverse offering, all wrapped up in a user-friendly package. Don’t just take our word for it. In a deep dive review, Coin Bureau called our interface “fast and uncluttered. Anyone with any trading experience should be able to quickly understand how to trade, stake, or provide liquidity on DODO.”
Since our inception, we have launched a steady stream of tools and created incentive programs for all types of users: traders, liquidity providers, and pool creators. DODO works with multiple wallets, including Metamask, WalletConnect, Portis, and any mobile wallet that has integrated DODO into its applications (e.g. MathWallet and TokenPocket).
We are a dual-chain marketplace, operating on both Ethereum and Binance SmartChain. And with no minimum deposit and the ability to use single tokens, liquidity providers can stake tokens they already own without taking on price risk. Users are rewarded for their loyalty with vDODO proof of membership tokens, which can earn them rewards, including a share of dividends and trading fees.
DODO Vending Machine and DODO Private Pool are a duo of features that allow liquidity providers to create and manage their own market-making strategies. The Vending Machine, which is permissionless and anonymous, allows anyone with a wallet to provide liquidity and earn rewards. Meanwhile, DODO Private Pool, geared toward more experienced liquidity providers, allows for customization of price and other parameters.
More rewards are available through Trading Mining, which allows users to earn tokens whenever they trade on our platform. Then there is Combiner Harvesting, a program that offers users access to promising and pre-vetted projects willing to collaborate with DODO. Approved projects can create liquidity pools on DODO, while those who provide liquidity for these pools can earn reward tokens.
In January, we launched Crowdpooling – a new protocol designed just for token issuers who need to raise capital for their projects. With Crowdpooling – a combination of “crowdfunding” and “liquidity pool” – token issuers can keep costs low while providing highly liquid capital pools for investors for a guaranteed period. This ensures healthy secondary markets for loyal investors.
Most recently, in March, we announced plans to broaden Crowdpooling’s reach to non-standard assets by rolling out a price discovery and liquidity protocol for non-fungible tokens (NFTs), the crypto assets taking the art world by storm.
DODO offers capital-efficient liquidity pools for a host of assets, a range of tools that simplify staking, trading, and issuing, and a wealth of incentives and loyalty rewards. We also offer you this: our promise to do all we can to ensure great customer experience now and in the future.