INJECTIVE PROTOCOL : Battle with Bitmex, FTX, Binance Futures and Revamped alternative to existing DEX and CEX

Since the onset of cryptocurrency trading, centralized exchanges which are more prone to hack attacks have been leading due to the drawbacks of existing decentralized exchanges. The most common hindrance to using Decentralized exchanges is poor trading volumes or low Liquidity. I personally prefer DEXes but due to challenges faced by most DEXes, I usually find myself using centralized exchanges more often even when I’m aware of the safety lags. A group of well experienced crypto enthusiasts who have researched on underlying issues faced by traditional decentralized exchanges came together to build a better DEX platform, which will ameliorate these known drawbacks and also implement modern technology and advanced security for better user experience. One major improved feature on Injective protocol is derivative trading, which has been absent with existing decentralized exchanges. 

Centralized exchanges like FTX, BITMEX, and Binance which have leverage/futures trading features are not safe. There have been several hack attempts and breaches on these exchanges, leaving the traders to wonder on the security of their assets always. Also higher trading fees, KYC, trade manipulations are few of the known challenges in trading with the aforementioned centralized exchanges. Injective Protocol brings a new dawn in derivative trading, in a decentralized and secure manner. 

Injective Protocol implements contracts for difference (CFD), enhances perpetual swaps, and ensures better derivative products are provided. Injective Protocol gives individuals the privilege to create and also trade on arbitrary derivative markets by just using a price feed. It embeds a decentralized orderbook, utilizes the Injective Chain which operates the Layer-2 derivatives platform, powers the ecosystem, and also serves as a decentralized Trade Execution Coordinator (TEC). This development is outstanding, since most crypto enthusiasts will prefer a modern decentralized system for derivative trading. Many will argue that since Injective Protocol is a DEX, it won’t be easy to compete with existing centralized exchanges but in the paragraphs below, I’ll explain why it beats existing decentralized exchanges, hence will be a better competitor in derivative trading to BITMEX, BINANCE Futures and FTX which are leading centralized exchanges in this regard.

MY PAST EXPERIENCE WITH EXISTING DEX AND SOLUTIONS PROVIDED BY INJECTIVE PROTOCOL MAKING IT A BETTER COMPETITOR TO CEX LIKE BINANCE, FTX, BITMEX.

I’ve been using forkdelta and etherdelta since 2017, but stopped 2018 after many frustrations from these DEX. Actually forkdelta is a forked version of Etherdelta so both have similar features, with forkdelta a little bit upgraded. 

With Forkdelta, sometimes when I see sell orders on the order book, then place my buy order to take the lowest sell order, it fails after some minutes. This got me wondering and worried, since it happened repeatedly even when I see sell orders before placing my buy order at exact sell rate. The most annoying part is that gas fee will be deducted for each failed transaction. This was due to trade collisions whereby the order book is not updated promptly, hence some already executed sell orders still display on the order book. Thus, leading to more buy orders matched to a particular sell order, causing multiple failed orders and waste of gas fee. Sometimes “gas wars” on decentralized exchanges (DEX) can cause trade collisions whereby some traders use very high gas fees to takeover a trade already in execution on DEX order book, leaving the trader who initiated the trade with a failed order. Traders who take advantage with higher gas fees are regarded as front-runners and the act is termed front-running. This gets worse with higher trading volumes.

Sometimes “gas wars” on decentralized exchanges (DEX) can cause trade collisions whereby some traders use very high gas fees to takeover a trade already in execution on DEX order book, leaving the trader who initiated the trade with a failed order. Traders who take advantage with higher gas fees are regarded as front-runners and the act is termed front-running. This gets worse with higher trading volumes.

The injective protocol uses two major components namely ; (a) settlement logic layer and (b) trustless relayer network protocol for Liquidity sharing purpose and Verifiable Delay Function (VDF) to combat trade collisions and front-running. I already explained what trade collisions and front-running mean in previous paragraph and will elaborate more on VDF as we proceed. Trade collisions lead to failed orders for most DEX, however injective protocol combat has put up reliable measures to combat this, hence the success rate for trade executions will be high comparatively. Trade collision and front-running has been major limitations to the use of existing decentralized exchanges, hence Injective protocol brings breakthrough in this regard. 

INJECTIVE PROTOCOL REPRESENTS A FULLY DECENTRALIZED AND TRUSTLESS PLATFORM 

It’s ironical to say that most traditional decentralized exchanges use centralized servers and third parties for matching and relaying orders, aside few like Etherdelta/Forkdelta which tries to refresh order book on every Ethereum block since it’s on-chain. This shows that most so-called decentralized exchanges are not truly decentralized and the very few which are truly decentralized have many flaws which need to be tackled. Hence, Injective Protocol protocol was enacted to uphold a trustless, decentralized system with accessibility to unlimited Liquidity pools. 

Before Injective Protocol came to the rescue, a few concepts to tackle trade collisions and front-running have been proposed like Batch trading and Trade Execution Coordinator, but they failed in the aspect of decentralized and trustless system. Injective protocol curbs this by ensuring a system of shared Liquidity pools in a totally trustless and decentralized manner. 

Injective protocol is on-chain, unlike most existing DEX which rely on centralized servers for order matching. Trade settlement by Injective protocol is topnotch which allows for prompt order book update and excludes trade collision. 

CORE FEATURES OF INJECTIVE PROTOCOL WHICH MAKES IT A GAME CHANGER AND BETTER THAN FTX, BITMEX AND BINANCE FUTURES

? No trusted third party service is required to execute orders, hence its trustless. 

? The settlement logic layer helps to resolve incompatible orders which are submitted on same order block, hence it is resolvable. 

? Time proofs shown on incoming orders ensure fairness since order sequence can be publicly verified. 

? There is no limitation to access any Liquidity pool, hence the protocol ks Liquidity neutral. 

? It’s impossible to manipulate the order filling sequence to gain price advantage. 

INJECTIVE PROTOCOL HAS A GREAT TEAM AND POWERFUL PROJECT BACKINGS 

Below is a cross section of core team members with great experience and devotion to attain the project aim.

 It will impress you to know that this project is backed by renowned players in crypto space like Binance, this shows how credible the project is. Below is cross section of project backers. 

BOUNTY PROGRAM

Injective protocol Bounty program is on. Do check the image and link below for more information : Injective Protocol Bounty

CONCLUSION 

In conclusion, Injective Protocol has a lot to offer to crypto enthusiasts since it proffers advanced and revamped solutions, by bringing forth a modern and secure decentralized exchange for seamless user experience and safety of funds while trading. It proffers decentralized derivative trading which is a new development in crypto space.

FOR MORE INSIGHT ON THIS REMARKABLE PROJECT, VISIT THE LINKS BELOW

Website: https://injectiveprotocol.com/

Whitepaper: https://docsend.com/view/zdj4n2d

 Bounty Program: https://bitcointalk.org/index.php?topic=5256993

Github: https://github.com/InjectiveLabs

Twitter: https://www.twitter.com/@InjectiveLabs

Telegram: https://t.me/joininjective

Reddit: https://www.reddit.com/r/injective/

Writer's information

Bitcointalk Username : deodivine1

Bitcointalk profile link : https://bitcointalk.org/index.php?action=profile;u=1390292