In light of some of the recent unfortunate events in the DeFi space, it’s good to remember that there are several great teams building some truly impressive platforms, grinding daily to bring users a more streamlined DeFi experience. Today I take a look at Opdex, the first Decentralized Exchange (DEX) protocols (yes, plural) built on the Stratis Ecosystem. Check it out…
Gimme That Good DeFi
So there are a bunch of DeFi protocols out there in the big wide world, and while they all offer comparable services to end-users, they are not all equal. Some platforms are more secure while others have higher liquidity, and others incorporate elements of gamification and even NFTs. A lot of DeFi infrastructure exists on Ethereum : Uniswap , Yearn , Balancer , Flexa , Bancor …the list goes on and on. In fact, if you look at the most popular DeFi protocols on DeFi Pulse , I would say a good 97% of these are all based on Ethereum. Now for Eth maxi’s, this is great news. However, for critics, it poses something of a problem…
Now before you string me up, this isn’t an attack on Ethereum or any network or protocol. This is simply an objective overview of the current state of DeFi, and from the looks of things, it’s Ethereum, Ethereum and more Ethereum…
I’m starting to see a pattern emerging…
There’s little doubt that Ethereum is here to stay, but it isn’t the be-all and end-all of DeFi, and it wouldn’t really be healthy if it was. The reason I say this is that decentralization kinda goes hand-in-hand with diversity. And when I say diversity, I mean a diversity of options. While many developers have chosen Ethereum as the platform upon which to build their Decentralized Apps (dApps), others are exploring different avenues. And that’s totally OK too.
OK, So What Are You Saying?
Sorry for the run-up, but this brings me to the purpose behind this piece. It’s no surprize really, but other platforms also have the capacity to have DeFi apps built on top of them, and arguably some of them are better suited for DeFi than Ethereum, or at least just as good. Now obviously there are other ecosystems like Binance Smart Chain , Polkadot and Solana to name but a few, but they’re all well-known names that many in the cryptosphere are already familiar with.
DeFi Spotlight articles will give DeFi protocols built on ‘lesser-known’ chains a chance to showcase their offerings and explain why they’ve opted for the road less traveled. The truth is that promising projects, regardless of their chosen platform, deserve exposure. To kick off this series, I am proud to share Opdex with you, a set of Decentralized Exchange protocols built on the Stratis platform .
DeFi in C#
Yes, that’s the name of my pièce de résistance on piano forte. OK, music jokes aside, I’m obviously talking about the C# Programming Language. That’s precisely what Opdex’s base code is, and I’m sure you can appreciate the simple brilliance of this approach to development. Firstly, C# is known by a huge number of developers, and as a high-level language, it’s relatively easy to get to grips with. Moreover, a lot of the more complex aspects of programming are abstracted away, meaning that programmers can focus more time on coding and creating great software for end-users.
No more music jokes, Scout’s honor!
And the reason why Opdex is coded in C# is due to the platform upon which it is built. Stratis is a project I’ve personally been following since I started out in crypto in 2017, and it’s one I still take great interest in. They offer Blockchain as a Service (BaaS) and ‘end-to-end solutions for native C# and .NET blockchain applications.’ Stratis uses Proof-of-Stake (PoS) as its consensus mechanism, and as of August 20th 2021, 210 Masternodes currently exist within the Stratis Network.
Now while I love Stratis, the point of this article is to focus specifically on Opdex. I was fortunate enough to snag Tyler Peña , the founder of Opdex, for an interview. Check it out!
Opdex - An Exclusive with Tyler Peña
Q: Could you provide me with a little background on yourself/your team as well as what motivated you to create Opdex?
A: My name is Tyler Peña and I’m the founder of Opdex Inc. I’ve been a developer for about 10 years now and have always been searching for a new unexplored area to dive into head first. I first heard about Blockchain in its early years but only started paying close attention in early 2017. That’s when I found Stratis and started following the project.
When Stratis held a smart contract hackathon, I entered with a project called Cirrus Swap, which was a traditional, order book-style Decentralized Exchange. Cirrus Swap ended up being the winner of that hackathon, and I kept building it out as a side project for about a year.
As I was building out Cirrus Swap, DeFi and AMM (Automated Market Maker)-type DEXes really started to heat up. At that time, I was speaking a lot with the Stratis team, and with a much-needed push, I decided to pivot from the traditional order book-style exchange to an AMM type DeFi protocol.
I began researching and planning out the project and quickly realized funding of some kind would be necessary given how fast thing were moving. Luckily, Stratis had been planning its Decentralized Accelerator program where applications can be placed and Stratis Masternodes can vote to grant community funds to new projects. I created the first proposal which was subsequently voted through, and I immediately started working on the project full-time.
Since then we have built an awesome, small, tight-knit team to build out the first version of the protocol. One of my childhood best friends, Steven Lee, is now leading the business operations side while I continue to lead technical decisions. We now work with multiple developers, a UI designer and other advisers that actively engage in the project.
Q: What do you think are some of the biggest problems with DeFi right now, and how does Opdex address these problems?
A: I think some of the biggest problems DeFi faces at the moment is transactional gas costs for layer 1 solutions, difficulties for the average user to move and use layer 2 solutions, and in general, the lack of accountability and trustworthiness of new protocols that contain bugs and known vulnerabilities.
The first problem, transactional gas costs, is a very big problem for Ethereum blockchain-based transactions. Network congestion creates a bidding war to have transactions successfully mined in a block and can cause ridiculously high fees even for transactions that fail. Imagine having to spend $20 to send an email that has a decent chance of failing. If it fails, you lose your $20, and you have to try again. That is Ethereum in its current state as the industry leader in smart contract-based applications. While improvements can be made in future versions, this problem is still very much an issue today.
The second problem helps alleviate the first but is another barrier to entry for the average user. A layer 2 solution can lower transactional gas costs, but at the expense of user experience. A new user entering the crypto market for the first time with fiat would likely use a Centralized Exchange (CEX). From there they’d purchase crypto, send it to a layer 1 solution, then from the layer 1 move it again to a layer 2 solution. This is obviously confusing for new users, and currently, Blockchain-based UI designs in general do not make this a seamless experience for end-users.
The third problem is lack of accountability and trustworthiness of some protocols out there. Believe it or not, users will move large amounts of cryptocurrency tokens through untrusted and unaudited exchange protocols. Sometimes this leads to a loss of funds through hacks, bugs, and rug pulls. Non-technical users do not necessarily know what to avoid nor how to validate the integrity of these protocols themselves.
Opdex chose to build on Stratis based on multiple reasons, and those reasons all directly help alleviate the above issues. Transaction gas costs remain low due to the scalable nature of Stratis and its sidechains without the need for layer 2 solutions. The sidechain we will deploy the protocols to uses a Proof-of-Authority (PoA) consensus mechanism with Masternodes validating the chain. These Masternodes are required to vote on all new smart contracts to be whitelisted, ensuring a public audit takes place and that no intentional malicious contracts are released.
Q: What motivated you to use the Stratis Platform as the basis for Opdex?
A: There are many answers to this question to be frank. Primarily I would say, the tooling and usage of C# to write smart contracts was the main point of attraction. C# is a tried-and-tested language (by Microsoft ) and is widely known by many developers, and there are many tools for it. The other choice was to learn something new, like Solidity for Ethereum Smart Contracts.
We really want to build an open source ecosystem that is governed by the community. For this to work as envisioned, it requires developers building on top of the protocol as if it were their own. The use of C# at the core of the project will not only help new developers learn about DeFi and smart contracts, but also allow them to use a lot of the tooling they’re already familiar with. This can drastically increase the adoption rates by developers while also decreasing the frustration of learning new languages, frameworks and tooling.
Q: Are there any unique features or functions of Opdex that you’d like people to be aware of (over and above those listed on your site)?
A: Something really cool that we’ve done but not spoken too much about is the ability to deploy new markets with configurable options. There are two types of deployable markets: a staking market with staking and mining capabilities, and a standard market that has configurable permissions and transaction fees.
Opening up the ability to be able to deploy separate markets with separate liquidity pools, all within a single Blockchain transaction, is an incredible accomplishment and feature to have. Now, businesses that have use cases for their own markets can work with this existing protocol and not have to build their own solution. Suppose a business wants private liquidity pools where traders and liquidity providers must be whitelisted for exclusive access…these markets can do that. Or if that business wants a 0% transaction fee and to only have whitelisted liquidity pool options to trade from, that is also possible.
An example could be a company that makes games all with their own in-game currencies. Users purchase or earn these, let’s call them Gems, but they can never sell them back or transfer them elsewhere to help a friend in need or whatever. These markets allow game creators to use their own market with their own tokens, liquidity pools and fee amounts in their games. This makes tradable in-game currencies, even across games, possible.
We want to become a DeFi platform standard that is so easy to use that developers from all sorts of ecosystems can integrate into their projects without ever having to touch a smart contract, and we are really excited about the role this specific feature will play in that goal.
Q: Does Opdex borrow from any existing protocols, or has it been written from scratch?
A: We’ve done a lot of research on the top DeFi protocols and learned a lot along the way. I’m talking about projects such as Compound, Curve, Uniswap, SushiSwap, PancakeSwap, and so on.
The large majority of our protocols are written from scratch without references. The liquidity and mining pool-based smart contracts used references from other projects such as Uniswap. The projects referenced aren’t written in C#, so any references were rewritten and tweaked for the needs of our protocol and for Stratis Smart Contract compatibility.
Q: Do you guys have a Roadmap available?
A: Our core focus is finishing the development of the platform and working through other logistics of the project. Currently the protocol is ready and open sourced, and we are working internally and with the Stratis team to wrap up the required development for Testnet and Mainnet releases.
Once these releases occur, our focus will shift towards assisting and supporting developers and users in knowledge transfers for building onto the public protocols and making it their own.
Q: What are the launch plans for Opdex, and is there any date by which you hope to have the protocol fully released?
A: Our team has been operating an internal development network on a private chain for the past few months. While the protocol is finished, the other layers of the project are nearing completion.
Opdex protocols will take advantage of the latest updates to Stratis code bases and smart contract capabilities and is slated to be deployed to their public Testnet very soon. Here it will run indefinitely as a public test environment for users and developers alike.
The public Testnet environment will run exclusively for a minimum of 2 months to allow for the initial full liquidity mining cycle to complete. During that time, the community will be encouraged to take a deep dive into the project and prepare for the vote for protocol whitelisting on Mainnet, which is on target prior to the end of 2021.
I have to say that I’m very intrigued by the Opdex project and will continue to follow its development. There’s little doubt in my mind that DeFi has to spread beyond Ethereum if it wants to survive in the long-run. I know I say it almost every article, but we’re still in the early days. New protocols will bring solutions to longstanding issues and help introduce the much-needed diversity the DeFi industry needs. I’m against over-reliance on any one protocol, and probably even a handful of protocols. Heck, some oligopolies are even worse than monopolies since there’s the ability to collude. Centralization happens when too much power is concentrated in one region, and we don’t want any of that. No way!
I’d like to thank Tyler once again for his time and incisive insights and will be sure to talk to him again in the future. There’s a whole universe of DeFi coming to life, and I’m sure Opdex will make an excellent addition to it. Until next time!
Disclaimer: Brynn holds STRAX tokens. The above is not financial advice. Always do your research before investing in any project.