The decentralized TDEX exchange, built on the Liquid network, will open on Monday.
The project, called TDEX, has announced its entry into the Open Alpha phase. TDEX was created by Sevenlabs, which in addition to its current work, also offers white-labeling consulting and services. This exchange offers a completely unique feature to the market automators who currently dominate the volume of exchanges within the chain. The TSWAP protocol used in this exchange focuses on nuclear exchanges, which is a way to establish a direct transaction between the two parties. Unlike AMM, there is no calculation formula that can impose a specific exchange price. "Sevenlabs CEO Claudio Levrini told :
TDEX delegates complete control over the use of a fixed price strategy or the addition of external price feeds and custom trading logic to the liquidity provider.
The important point is that the provision of liquidity in this platform will probably be more than platforms such as Uniswap. Atomic exchanges are often seen as a decentralized method of exchanging assets in the Bitcoin blockchain and other UTXO blockchains. While acceptance of these exchanges has so far been limited, the proposed Taproot and Schnorr designs can provide simpler mechanisms through Adapter signatures. Adam Back, CEO of Blockstream, stated that:
TDEX is an interesting example of the increasing number of DeFi solutions appearing on the Liquid network - which can be called LiFi.
But this relative level of focus on the Liquid network has been criticized in the past, especially for introducing concepts traditionally associated with irreversible atrium tokens. Liquid is a bitcoin-dependent subsidiary chain of bitcoin-affiliated brokers that validates the network. These brokers are bitcoin-related commercial entities that primarily include exchange offices. Since an incident in June caused Blockstream to briefly control 870 BTC of network reserves in June, the federation and the design of the peg system show a significant point of trust in the network.
Some people in the bitcoin community often push for the creation of Bitcoin DeFi, which could open up the bitcoin network to the decentralized, lending world of Atrium. Atomic loans are currently the only projects that use native bitcoin as collateral for borrowing, although they use Atrium for the rest of their systemic logic. Other Bitcoin DeFi projects include MoneyOnChain, MakerDAO analogue at RSK, and now TDEX.
Basically, due to the limitations of the smart contract, none of these projects were built locally on the Bitcoin network. These restrictions make it difficult to build "no-confidence" blocks to the blockchain, forcing side chains to use federation-based mechanisms. But given the evidence of the WBTC's success, the demand for bitcoin in DeFi is clearly high. More bitcoins are locked in Atrium than Liquid and Lightning Network. It remains to be seen whether the demand for Liquid defenses will be as strong.