Change the exchange: the future Coinbase will go to the center?


nnnnIn the area of ​​the center chain, the exchange is mainly centered, and the history of the Mt Gox and other exchanges tells us that the centralized exchange model is at risk. So there are OpenANX and Swap such a transformative force. However, the services of such exchanges are currently limited to transactions between trading currencies, not currency. In the future, the centralized exchange model will continue to develop, but it is generally believed that the centralization and de-centralization of the exchange model will coexist.n
nnTranslation: Annie_Xun
nThe newcomers in the chain area may have noticed a strange phenomenon, in the heart of the industry, some of the largest start-up companies are trusted central institutions.n
nBut while it is still a single institution that is responsible for the operation of the exchange, the exchange between traditional and encrypted currencies, some of the industry’s longest-established start-ups are beginning to hope that the future will be more in line with the spirit of the technology.n
nA group of centrally located encrypted currency exchanges that only exist on the chain chain begin this effort and is expected to eliminate reliance on third-party intermediaries.n
nTo the center of the Exchange Infrastructure Infrastructure Agreement OpenANX technical director Hugh Madden said, “to the center of the easy is the direction of the future.”n
nMadden says changes in the business model are inevitable, as the current design has attracted hackers, and there have been many cases of long history of encrypted money, such as the most famous Mt Gox.n
nAnd if there is no strong regulation of the operation of the centralized exchange, it will limit the operation and financial transparency of the exchange. Such exchanges allow customers to be able to really have a token from the technology.n
nIf it is to go to the central exchange, each customer’s order is directly paired, and sometimes even do not need an order book.n
nTo the center of the exchange Swap CEO Michael Oved said:n
nn”In the next two to five years, you will see some good solution to the center, but whether they can occupy the market share of existing enterprises, I am not sure.”n
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nNew modeln
nSo what is the difference between Swap and the centralization of the transaction?n
nFirst, it does not have an order book, and the order is completely paired. Swap does not charge a service fee, and the profit comes from the tokens that customers using Swap must buy (more like a one-time license fee).n
nOpenANX and Swap, as well as 0x and Bancor are the latest to the center of the exchange, of course, there are other projects.n
nSwiss ShapeShift operates from 2014, its CEO Erik Voorhees said that the current daily processing of more than 15,000 customer orders, the total daily amount of about 10 million to 15 million US dollars.n
nAt the same time, the central exchange is also continuing to develop products, including wallets and brokerage services, encrypted currency prices soared to expand its customer base.n
nAlthough the lack of convenience to the centralization model, but in other areas have advantages. The nascent market may be more competitive because the new participants can avoid the strict supervision of peers.n
nIts advantages are obvious, including for well-known start-up companies.n
nCoinbase public relations representative Megan Hernbroth said, “to the center of the exchange is the ecological development of the supplement and an important part of the middle zone.”n
nBut she said that the current central exchange also has some advantages.n
nn”We believe that letting Coinbase replace users with the security of digital money is a better solution than the user’s own management store.”n
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nCompromisen
nIndeed, it is not yet known how high-tech solutions will capture the market at what rate.n
nThe main obstacle to the centralization of the exchange is that they are not currently able to trade in encrypted currency and denominations, and they can only trade between different encrypted currencies, as this avoids compliance requirements such as anti-money laundering regulations.n
nThe problem with the centralization of the exchange is the lack of liquidity. Specific to Bancor, its business model was publicly criticized by Emin Gun Sirer, co-director of the Initiative for Cryptocur71 and Cornell University, and Bancor, of course, strongly argued.n
nWallet supplier Blockchain CEO Peter Smith expressed regret over the trade-off between the two major exchanges.n
n”Despite the dramatic increase in the number of centralized exchange projects, the focus is only on encrypted currency pairs of encrypted currency transactions, which are not practical point-to-point solutions. Real-world banks, compliance and anti-money laundering (AML) can not attract those few advanced technologies engineer”.n
nBut Smith still sees its potential.n
nn”If you can build a platform to centrally integrate these two main functions, let the exchange operators focus on the core competitive advantage (local language, support, compliance, banking), the private key from the assets and liabilities The table transferred to the block chain, you will have a product that can attract the entire industry value.n
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nFuture prospects n
nThe status quo and the bright future between the centralization of the exchange in the field of innovation, ShapeShift recently launched a Prism product, so that customers build a tracking asset portfolio encryption products.n
nOpenANX believes that has been completely resolved the problem of currency exchange.n
nIn its model, the national center of the exchange can be real-world assets of the tois process, and then with the help of OpenANX to the center of the transaction.n
nMadden said the largest centralized exchange is the “systemic risk” of the existing encryption currency. He predicts that the future of the central exchange will continue to run, but its focus is entirely to guide the judicial issues, such as banking business relations and supervision.n
nShapeShift’s Voorhees also believe that these patterns will coexist.n
nHe recently wrote on Reddit:n
nn”I expect the future bank to be like Coinbase, and I mean Coinbase’s supplement. The encrypted currency makes it possible for everyone to choose to hold their own currency, which is good, but it does not mean that everyone has to do it, or everyone wants this way”.n

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