0x & ZRX: The Secret Sauce of Decentralized Trading
0x offers a novel approach to digital asset trading. This self-governed protocol enables Ethereum-based transactions, free from centralized mediators. ZRX, its native token, empowers holders with governance rights and staking opportunities. Check out our just-in for more riddles for 0x!
0x is a self-governing protocol encouraging netizens to smoothly and swiftly trade ERC20-compatible assets and other coins fueled by Ethereum. The key feature of the protocol is that ecosystem members do not depend on centralized mediators and enjoy DEX exchange freedoms to the fullest.
The 0x project engineers have developed a striking peer-to-peer digital asset exchange model that is openly verifiable and uses community-driven smart contracts. The hybrid model has allowed 0x to assemble an easy, gliding, and versatile trading protocol that blockchain developers can implement in their products in the blink of an eye.
Today, numerous undertakings on creating web apps and crypto start-ups employ the blockchain-based exchange protocol, including portfolio trackers, DEXes, wallets, etc.
0x (ZRX) Token Utility
ZRX is a token combining two rudimentary roles: staking and governance. Meanwhile, native token holders can actively develop the protocol environment, implement initiatives, and utilize the token (supplying ETH liquidity) to gain funds in the staking program.
According to Coinmarketcap, ZRX token key indicators as of June 7, 2023 are as follows:
- Token name: ZRX
- ZRX price: $0.198
- Powered by: ERC20
- Fully diluted market cap: $197,945,297
- Market cap: $167,768,854
- Total supply: 1,000,000,000 ZRX
- Circulating supply: 847,496,055 ZRX
When ZRX is utilized as a governance token, parties are granted voting rights in accordance with their holdings. This approach eliminates imbalances and massive violations among community members.
Regardless of the number of ZRXs, any user or organization can put forward legitimate initiatives and expect the community to support them. However, large coin holders have more voting power and can affect the protocol development vector more than small ZRX holders.
0x Origins
Will Warren and Amir Bandeali are the forerunners of the 0x, which kicked off in 2016. Both co-initiators remain in leadership positions (Will Warren as 0x's CEO and Amir Bandeali as CTO), contributing to the platform's development.
The platform's official launch is associated with a reasonably prosperous ICO, which took place in 2017 and allowed the company to raise $24M in funding from Tier-1 backers.
Currently, the project brings together 30+ world-class developers, analysts, and designers who work tirelessly to implement new features and timely updates.
How Does 0x Work?
The first thing to note is that the protocol uses a blend of on-chain/off-chain settlement models. Unlike all well-known on-chain DEX platforms, 0x can accumulate and operate liquidity outside on-chain networks. This protocol feature is executed by storing trading orders off- chain while transactions are settled on-chain.
It is noteworthy that the hybrid payment model of 0x gas fees is wallet-friendly due to two primary parties holding out the entire trading process:
Takers. These individuals take liquidity from the order book while maintaining the proper level of demand and perform instant matching. If a maker has confidence in a particular taker, the order will be executed immediately after a short agreement via messengers or OTC (over-the-counter) trading desks.
Makers. These agents maintain the proper level of liquidity in the 0x order book. The main task of Makers is to ensure that the asset price on different trading platforms is the same.
The lack of centralized intermediaries significantly speeds up the transaction pace of token swaps. This process is easiest to imagine as a classic peer-to-peer (P2P) network for sharing orders via the 0x messaging model.
0x Funding
The company raised $109 million in funding over nine rounds, while the last round (Series B round) was held on April 26, 2022. 0x received support from 42 investors. Meanwhile, COIND and OpenSea were the last to jump on the train.
0x Funding details:
- April 26, 2022: Series B (Early-Stage Venture) supported by 14 investors (To Kenz Capital, Sound Ventures, Reid Hoffman, Pantera Capital, OpenSea, Jump Crypto, Jared Leto, GSR, Greylock, COIND, etc.) with $70M money raised.
- February 5, 2021: Series A backed by 11 investors, including Platinum Capital, Pantera Capital, Nima Capital, Nascent, IOSG Ventures, Coinbase Ventures, Blockchain.com Ventures, and Alliance DAO with $15M money raised.
- October 19, 2020: Secondary Market. Money raised – N/A.
- October 1, 2020: Kosmos Ventures and Bossanova Investimentos funded Venture Round. Money raised – N/A.
- October 1, 2017: Venture Round supported by Placeholder. Money raised – N/A.
- July 28, 2017: Seed Round backed by TGE Capital, Nathan Doctor, Fabric Ventures, AlphaCoin Fund, and 8 Decimal Capital. Money raised – N/A.
- July 1, 2017: Seed Round funded by Kenetic and Hex Capital. Money raised – N/A.
- June 29, 2017: ICO supported by 11 investors (Visary Capital, Simulation Ventures, Limitless Crypto Investments, James Sowers, Infinite Capital, George Burke, Genesis One Capital, Chris McCann, Cardinal Capital) with $24M money raised.
- January 1, 2017: Venture Round backed by Boost VC.
0x also managed to finance two promising projects, Goldsky and Blowfish. Their latest investment of $11.8M went to Blowfish on September 30, 2022.
0x Roadmap
As per the project's creators, the initial objective behind the 0x protocol was to establish a self-governing system administered by the owners of ZRX tokens. The aim was to empower token holders with the ability to collectively govern and steer the protocol's direction.
At the same time, 0x Labs was supposed to remain no more than one of the interested parties among the many participants.
This approach was supposed to allow the 0x protocol to develop the ecosystem further and receive quality feedback from community members.
0x roadmap details:
- Feb 2017 – 0x protocol launch
- Apr 2020 – ZEIP established
- Jan 2021 - 0x v4 Deployment
- Feb 2021 – 0x Protocol Bootstrap Delegates
- Feb 2021 – 0x Protocol Treasury
- Jan 2023 – Short-Term Delegation Experiment
- SOON - 0x protocol + 0x Labs
According to the roadmap, the 0x team’s latest achievements were creating a grant program, organizing a security council, and launching a voter program. All this made it possible to build an even stronger foundation for developing the 0x community. The company is aiming for even more decentralization, seeking to transfer active management to the participants in the ecosystem.
0x Tokenomics Details
According to the official stance, the ZRX token has a maximum supply of 1,000,000,000 units. Additionally, token holders have the opportunity to generate profits through staking by providing liquidity to the 0x platform.
Parties delivering additional liquidity build stake pools and profit depending on the staked volume. While Ethereum powers the protocol, all rewards are vested in ETH coins. Next, dividends can be converted into ZRX directly on the platform.
