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Project Serum: First DEX with central orderbooks now live

Updated: Aug 26, 2024
Published: Aug 31, 2020
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Decentralised Exchanges: Traction

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For the past few months, decentralised finance has been the talk of the crypto town. One of its components are decentralised exchanges which have garnered immense volumes in the past few weeks, some even flipping Coinbase Pro’s volumes.

Decentralised Exchanges: Flaws

One of the main flaws of DEXs is the user experience. Due to their mechanism, users can only state what and how much of a certain asset they would like to swap for another, but they cannot pre-determine the price they’ll be swapping at. In addition to it being very far from the usual centralised exchange experience many are comfortable with.

The second and just as important, if not more important flaw, is that they live on the Etheruem blockchain which is yet to have its scalability issues fixed. This has led to sky-high gas fees for transaction processing.

Project Serum

The two main problems users have been having have been proposed to be solved by Project Serum. The DEX that was announced this month and became functional this month. A decentralized exchange, backed by FTX, that lives on Solana. The latter is a much faster blockchain that can process 50,000 transactions per second at very low costs. The other main feature is that they’ve brought the centralised exchange experience with central limit orderbooks, allowing users to pre-determine the price they’d be trading at with a user interface they are used to.

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