Initial Coin Offerings (ICOs) also known as token sales are being used to drive network effects around specific applications (dApps) rather than the common building blocks (protocols) that make applications possible within the Ethereum framework. And that’s a problem according to Will Warren, the Co-founder and CEO @0xProject.
To develop building blocks faster we must embrace a philosophy of standardization and decoupling. Unfortunately, the current culture surrounding token sales has created incentives that do not align with these beneficial practices, stated Warren.
App coins and protocol tokens are two completely separate classes of digital assets. Protocol tokens provide the financial incentives needed to drive a cryptoeconomic protocol which may or may not be implemented within an Ethereum smart contract.
Decentralized applications merely facilitate access to protocols for a particular use case and have no cryptoeconomic mechanisms. The current trend of coupling dApps to their underlying protocols leads to redundant smart contracts that impose unnecessary costs on end users. For non-native protocols to be standardized and future-proof they must incorporate a decentralized update mechanism; such an update mechanism is likely cryptoeconomic in nature.
We describe a protocol that facilitates low friction peer-to-peer exchange of ERC20 tokens on the Ethereum Blockchain. The protocol is intended to serve as an open standard and common building block, driving interoperability among decentralized applications (dApps) that incorporate exchange functionality. Trades are executed by a system of Ethereum smart contracts that are publicly accessible, free to use and that any dApp can hook into. DApps built on top of the protocol can access public liquidity pools or create their own liquidity pool and charge transaction fees on the resulting volume. The protocol is unopinionated: it does not impose costs on its users or arbitrarily extract value from one group of users to beneﬁt another. Decentralized governance is used to continuously and securely integrate updates into the base protocol without disrupting dApps or end users.
At a fundamental level – 0x is an open protocol for decentralized exchange on the Ethereum Blockchain and is intended to act as a basic building block that may be combined with other protocols to drive increasingly more complex Blockchain applications. It uses a publicly accessible system of smart contracts that can act as shared infrastructure for a variety of dApps. In the long run, open technical standards tend to win over closed ones, and as more assets are being tokenized on the Blockchain each month, we will see more dApps that require the use of these diﬀerent tokens. As a result, an open standard for exchange is critical to supporting this open economy.
Open protocols should be application-agnostic. Decoupling the protocol layer from the application layer provides mutual benefits for dApp developers and end users alike.
- Off-chain order relay + on-chain settlement = low friction costs for market makers + fast settlement.
- Publicly accessible smart contracts that any dApp can hook into.
- Relayers can create their own liquidity pools and charge transaction fees on volume.
- Standardization + decoupling = Shared protocol layer →
- provides interoperability between dApps
- creates network effects around liquidity that are mutually beneficial
- reduces barriers-to-entry, driving down costs for market participants
- eliminates redundancy, improves user experience and smart contract security
- Decentralized update mechanism allows improvements to be continuously and safely integrated into the protocol without disrupting dApps or end users.
See website here for more information and whitepaper.
- SportyFi – Decentralized Sports Investment Start-up Endorsed by Soccer Superstar Roberto Carlos - October 16, 2017
- Acronis Joins Runa Capital and Parallels In Accelerating Innovation and Supporting Blockchain Initiatives in Malta - October 16, 2017
- Jaxx Allows First Crowdsale Participation with STORM Token - October 16, 2017
- Hyperledger Knits New Project – Hyperledger Quilt - October 16, 2017
- Legolas Exchange Partners With BanQix to Protect Institutional Investors - October 16, 2017
- MARK.SPACE Announces Launch Of Blockchain-powered VR-platform With Upcoming Token Crowdsale - October 16, 2017
- IRTI Partners With Ateon And Settlemint To Develop Blockchain-based Products For Financial Inclusion - October 16, 2017
- Golden Alliance Coin Announces ICO – For Mining Gold - October 16, 2017
- Media Aggregator Esports Gold Announces $5 Million Ethereum Token Sale - October 16, 2017
- MinexCoin: Park the Volatility! - October 16, 2017
- Ambrosus Token Generation Event (TGE) Officially Cracks the Largest Blockchain Crowdfunded Projects in History - October 15, 2017
- Freedom Streaming Announces An ICO For The First Uncensored And Anonymous Live Streaming Platform - October 14, 2017
- MicroMoney starts a $30,000,000 token distribution campaign - October 14, 2017
- Announcing the First Members of the DataBrokerDAO Alliance - October 14, 2017
- STK Global Payments Announce Global Advisory Board – Token Sale - October 14, 2017
- Zilliqa Breaks 2,400 Transactions per Second with their ‘Sharding’ Blockchain - October 13, 2017
- Dappbase Launches High-Performance Infrastructure for Decentralized App Developers - October 13, 2017
- bitJob Raises $2 Million to Launch Decentralized Platform for Student Employment - October 13, 2017
- Particl Unveils Its Confidential Cryptocurrency Transactions - October 13, 2017
- Waves To Develop “liquid Democracy” Applications - October 13, 2017
- DECENT Updates Core – New User Issued Assets and More - October 13, 2017
- Dash for Dope – Digital Payments Platform Alt Thirty Six Selects Dash As Payment Method of Choice for New Retail Sectors - October 13, 2017
- Garvan Institute And E-nome Enter Strategic Alliance To Enhance Medical Research Data Management Through Blockchain Tech - October 13, 2017
- Moody’s: New Payment Technologies Pose Threat, But Incumbents Unlikely To Be Displaced - October 13, 2017
- ZAP Token Distribution Event to Begin October 21, 2017 - October 12, 2017
- AirFox Raises $15 Million in Successful ICO, Brings New Mobile Banking Solutions to Emerging Markets - October 12, 2017
- HydroMiner Token Sale Starts October 18th – Austrian Regulators Approve - October 12, 2017
- The SBM Group and SALT Technology Enter Exploratory Partnership to Collateralize Blockchain Assets - October 12, 2017
- ExHasta: Integrating and Empowering Innovators – Announces Token Sale - October 12, 2017
- Tech Veterans Set Up Global Public Offering Fund To Turn Top U.S. Startups Into Asia-Pacific Listed Unicorns - October 11, 2017
- ZenCash Partners With Welto to Allow Bill Payment in Cryptocurrency - October 11, 2017
- Cryptopay Plans to Tie Investments to Service Performance Metrics - October 11, 2017
- Boosteroid Wants to Squeeze Google and Amazon on the Cloud Computing Market - October 11, 2017
- Fiinu Launches Pre-sale Ahead Of ICO - October 11, 2017
- Famous Russia-based startup BioCoin closes first round of presale with $2.5 mln raised - October 11, 2017
- eSports Platform EloPlay to Hold a Token Sale - October 11, 2017
- CapLinked Partners With Storj Labs, Moves Enterprise Document Management to Blockchain Technology - October 11, 2017
- Ethfinex and Cofound.it Collaborate to Bring Trust to Blockchain Economy - October 11, 2017
- Exscudo launches Bug Bounty campaign - October 11, 2017
- Blockchain Capital and TaaS Join BLOCKv, a User Interface for Blockchain Tokens - October 11, 2017
- Lufthansa Group Partners Up With Winding Tree To Bring Blockchain Technology To The Travel Industry - October 10, 2017
- Peer Mountain Launches Distributed System of Trust to Give Data Control Back to Consumers - October 10, 2017
- Revolutionary Ico Aimed At Tackling Waste Surplus And Energy Shortfall Announced - October 10, 2017
- Streamr, the Decentralized Real-Time Data Economy, Joins the Trusted IoT Alliance - October 10, 2017
- Exscudo and Crypto.Tickets exclusive partnership opens a new market for cryptocurrency - October 10, 2017
- Guardian Circle Turns to Blockchain for Global Decentralized 9-1-1 Emergency Response - October 10, 2017
- NEM Foundation Partners with Metaps Plus, Expanding Korean Presence - October 10, 2017
- StormX Lowers Community Appreciation Sale Cap Due to Overwhelming Demand - October 10, 2017
- Token Report to Provide Membership Access to World’s Largest Database on ICOs - October 10, 2017
- BLOCKv Adds Visionary Futurist Peter Diamandis and Serial Entrepreneur and Investor Gil Penchina to its Advisory Board - October 10, 2017