ADAX has just launched a non-custodial, order-book-based decentralized exchange on Cardano as per an update on January 30.
After six months of active development, ADAX version 1 is live. The development team is delivering on their long-held promise as they aim to take on competitors and expand the Cardano DeFi ecosystem.
ADAX developers now aim to dominate and make their portal a go-to DEX on Cardano, rising to be the equivalent of Uniswap and PancakeSwap on the most decentralized Proof-of-Stake blockchain.
DeFi in Cardano is Growing
The DEX’s timely launch reflects the team’s dedication of releasing a fully functional product to the rapidly expanding network. Less than six months after Cardano activated smart contracting at the end of the Alonzo Upgrade in late September, the network’s total value locked in DeFi is expanding.
From the second week of January 2022, Cardano’s TVL rose from around $3 million to over $70 million, according to trackers. With the activation of ADAX, assets under management in the decentralized and unique protocol could continue expanding as users flock to the network.
Unlike competing networks like Ethereum, transacting in Cardano is cheaper. While Ethereum network users pay steep Gas fees for token transfers and even more for deploying smart contracts in DeFi operations, Cardano’s network’s fees are negligible.
Cardano also stands out because of its unique EUTxO architecture and smart contracts using Plutus functional programming. Unlike Ethereum, Cardano has better smart contract composability and determinism, translating to higher scaling and security. Overall, Cardano’s Ouroboros consensus algorithm is lightweight.
Concentrated Liquidity for High Capital Efficiency
These features are what ADAX is riding on to release an efficient order book-based DEX whose transactions are processed on-chain. ADAX uses concentrated liquidity, an innovation whose benefits are evident in Uniswap v3.
There are capital efficiency benefits by allowing liquidity providers to supply liquidity within a given trade range. At the same time, liquidity providers earn more rewards while making the DEX efficient and more liquid. For traders trading on ADAX, the better distribution of liquidity and general efficiency in asset allocation makes trading smooth and cheaper.
Addressing Congestion and Concurrency
ADAX creators have also built a custom PAB solution using Cardano’s Plutus smart contracts for higher decentralization levels.
Besides decentralization, the team is aware of potential congestion concerns that may dent user experience, as was the case in the last week of January. The ADAX team will split transactions into smaller chunks to avoid congesting the base layer where all orders are confirmed.
Even though splitting transactions tend to increase instances of concurrency, the team has a mechanism to reduce the frequency of them occurring. These considerations complement their effort of releasing an easy-to-use interface for quick, frictionless navigation.
ADAX Partners and Integration
ADAX is integrating the Nami browser wallet and plans to add GeroWallet and CCVault. They have also partnered with Charli3—an oracle provider, World Mobile—a telecom infrastructure provider on the blockchain, BlackDragon, VyFinance—a DeFi protocol with a neural net and a yield auto-harvester, and Netvrk.
With so much coming out of Cardano and ADAX looking set to be a major player in the ecosystem, we’ll be keeping our eyes on this one over the next few weeks.