After the needs, come the wants.
I like Maslow’s hierarchy of needs. It’s a clear foundation of human motivation and curiosity. Once the essentials are covered we inherently have this desire to want more. There’s this deeply rooted evolutionary process of finding the best way to survive and thrive. It always takes us a couple of head bumps to figure out what “better” actually means. However, given enough time, we will figure it out.
To most people, everything needs to get better, because everything needs to get better. We do this because everything that gets worse eventually fades away in time.
Why is this relevant?
The last couple of years, the blockchain has seen major improvements. I’ve read stories online about how difficult it used to be to get some Bitcoins in the early days. Compare that to today and it’s obvious that the ease of entry has increased drastically. There’s a new foundation which allows people to create the next generation of platforms. The more creativity we let loose on this technology the better it’ll become.
Where is the easy entry into decentralized exchanges?
Before I jump into this I just want to give you a short explanation of what a decentralized exchange (or DEX) is.
DEX is an exchange that does not rely on a third-party service to hold the customer’s funds. Instead, trades occur directly between users (peer to peer) through an automated process. Cryptocompare – What is a decentralized Exchange
Short enough right?
After checking out a list of websites I created a list of the pros and hurdles I encountered to get to mainstream DEX adoption. The obstacles are challenges decentralized exchanges have to overcome to have a shot of becoming successful.
- You control your own funds
- Not hackable
- Not easy to use
- Low Liquidity
- Trade speed
- High gas amount per trade
IDEX is by far the most popular decentralized exchange out there. And I like IDEX. I’ve been using it for a while now and I remember that it took me a couple of hours to understand how it all works. By using it I could definitely understand where people would get confused.
Everything is always simple once you get it, but getting it is not simple. So while most reviews generally agree that IDEX is a great decentralized platform, they also see that the user experience/interface could use a major tune-up. So IDEX is definitely not bad, but there’s better. A lot better.
The pros I listed before speak for themselves and are applicable to any decentralized exchange. The focus will, therefore, lie on the obstacles decentralized exchange face and how Ethermium is tackling them head-on.
Ease of use
The first requirement for any product is that it has to work. You can spend all the time in the world creating the most awe-inspiring visual product ever but if it doesn’t work, it’s essentially worthless. Like building a plane without a yoke.
Once you have a working product you start to work on the visuals. The design is supposed to guide you through the platform like water through a lake.
One of the reasons people prefer Instagram over Facebook and Apple over most Android phones is because they do a great job at appealing to our visual nature. Humans have to be taught how to read, but nobody has to be taught how to see.
Ethermium has done a great job creating a visual experience like none other. No cluttered mess. No overwhelming text. Just a few clicks and you literally get it. You get it because there is nothing to get. I think it’s safe to say that Ethermium is setting itself up as the Apple of decentralized exchanges. And I’ve heard that they’re planning to make it even easier.
Visuals are and will most likely always be the best way to communicate and get your message across to people. There’s simply not enough time to learn and read everything. Some things need to be easy so we can focus on other things…like liking pictures and sharing this blog post.
Low Liquidity & Trade Speed
Liquidity describes the degree to which an asset or security can be quickly bought or sold in the market without affecting the asset’s price. In other words, and as an oversimplification, exchanges need to make sure that there are enough buyers and sellers. Which will require complex automated market maintenance.
Ethermium seems to have found a solution to the liquidity problem. The high liquidity on Ethermium will be provided by Top crypto exchanges like Binance, OKEx, and Huobi. This means that you can trade your tokens against an aggregated order book containing orders from the most popular and most liquid (centralized) exchanges, without the need to keep your funds there.
They’ve devised a system that minimizes the exposure to these centralized exchanges. The speed and programmable nature of cryptocurrencies allow them to instantly deposit and withdraw funds from centralized exchanges and use only a small amount of money to execute large trades. Transactions will also be executed immediately. Go to their help section to learn more about how they’ve solved the liquidity problem.
High gas amount per trade
Compared to Binance where they charge a 0.10% Maker and 0.10% Taker Fee; the fee on Ethermium is very competitive. And while Bitcoin itself hasn’t been hacked, some of the exchanges where they are traded on did have to endure a couple of punches.
This is not saying that Binance or any of the other centralized exchanges will get hacked in the future. The only thing we know for sure is that, as long as it is centralized, they could be hacked. So my question to you is: why would you take the unnecessary risk of losing something valuable. With a decentralized exchange, these things cannot happen. Sometimes it pays to pay a little bit more.
Although I must add that the future holds a lot of surprises. Binance is already looking into creating a DEX. Things could become more interesting when the giant centralized exchanges change to decentralized exchanges. In any case, only the most adaptable exchanges will survive.
Just had a productive meeting for #Binance #DEX (decentralized exchange), where $BNB will be native gas, and the exchange don’t control user funds. Aiming for a public beta end of the year/early next year. Yes, we work on Saturdays, non stop!
— CZ Binance (@cz_binance) September 29, 2018
Ethermium clearly states on their website that there is no single point of failure since a decentralized exchange is an exchange that does not store customers’ funds in custody. Meaning that your funds cannot be affected by regulation, government intervention or hackers. As long as you keep your private keys safe, nobody can access your funds.
While we’re still waiting on regulations from different parts of the world, using this exchange poses no danger to you because your personal funds cannot be touched by anyone but you. Even if the website crashes into oblivion, your funds will be safe in your personal wallet.
The whole point of the blockchain is to remove the need for a centralized point of failure. Having centralized exchanges where you store your decentralized tokens is exactly like having your own money and handing it to the bank.
Banks, while corrupt/incompetent in a lot of areas, do serve the purpose of being a decent middleman. Most of us have never had a problem withdrawing our money from an ATM or sending money to someone.
However, once a better system arrives it’s only a matter of time before the old system collapses. They might go down kicking and screaming to prolong the inevitable, but the inevitable will happen.
I’m not saying that there should be no room for centralized exchanges because everything has its pros and cons. I’m simply stating that we should have great options to choose from. Both centralized and decentralized.
Almost everybody trades on centralized exchanges. The current volumes on these centralized exchanges dominate the whole cryptocurrency marketplace. There are several DEXs that are trying to break through this barrier. Just like Bitcoin didn’t become Bitcoin overnight, so will DEX have to overcome the hurdle.
Looking at the state we’re in right now, with exchanges like Ethermium, I’m pretty sure that decentralized exchanges have a bright future ahead of them. Time for you to join the next revolutionary wave in the world of the blockchain. Mass adoption is key!
Ethermium has created its own section where they lay out why they’re better than the competition. While they’re obviously biased, I must admit that creating an awesome platform gives you that right. Just go to their website and click on Help to check it out.
Honestly, I don’t even know what you’re still doing on this website. Go check out this gem and experience it for yourself.
Like always, feel free to let me know your experience using the Ethermiumn decentralized exchange.