What is ErgoDEX? Overview of ErgoDEX and the ERG coin of the Ergo ecosystem

Overview of the ErgoDEX project

ErgoDEX is a decentralized exchange on top of Ergo and Cardano.

What is ErgoDEX?

ErgoDEX is a decentralized, non-custodial exchange. It allows for a quick, easy and secure transfer of liquidity between the Ergo and Cardano networks. In other words, this is a decentralized financial application, not supervised by any intermediary organization. ErgoDEX is one of the Dapps developed on the Ergo network. In addition to ErgoDEX, we can see many other Ergo applications such as Ergo Auction House, Ergomixer or Ergo NFTs, etc.

Currently, ErgoDEX is in the Beta stage. It includes features for an AMM solution such as swap, deposit, and redeem. ErgoDEX Beta UI operates on a full-fledged blockchain network, so transactions are irreversible once they are moved to the “executed” state. For any transaction related to ErgoDEX Beta, readers can consult more through the content explorer of the Ergo platform.

However, because this is still a Beta version, investors (investors) will need to accept some possible risks. In that case, the ErgoDEX team will not guarantee that the application is completely error-free. In addition, in the Beta phase, the application has not been independently audited like other applications. The ErgoDEX team itself also suggests that investors should not use the ErgoDEX Beta UI to trade large amounts of money. This will increase the possible risks for investors.

Highlights on ErgoDEX

As announced by the development team, ErgoDEX will include the following key features:

Cross-chain exchange: Based on the eUTXO model that will provide the ability to share liquidity between different types of exchanges on the Ergo and Cardano ecosystems.
AMM DEX: The AMM DEX model uses automated market-making to provide real-time information on exchange rates and slippage. This form is suitable for pairs with low liquidity.
Orderbook DEX: Includes two forms, an Atomic limit order, and Partial limit order. This form is suitable for pairs with high liquidity.
Transparent tokenomics: In ErgoDEX, a fairly complete mechanism related to tokenomics has been built in ErgoDEX. In which, users will benefit from DEX services, liquidity providers (LPs) will benefit from protocol fees, and the DEX itself will benefit based on a fixed transaction fee.

ErgoDEX Development Team

As I shared above, ErgoDEX is one of the applications in the Ergo ecosystem (Ergo Foundation). The Ergo Foundation considers itself a community-based organization with the following key principles:

Promote the continued development of the Ergo Platform protocol.
Promote widespread adoption and use of the Ergo platform and its native token (ERG).
Ecosystem development around the Ergo platform.
Promote the use of the Ergo platform and blockchain technology for social good.
Support truly decentralized infrastructure.
Support privacy as a fundamental human right.

In addition, there is also a team built for the development of ErgoDEX. Some of the notable members include the following:

Ilya Oskin: He is a software engineer, core developer of Ergo, and lead developer at Mail.ru Corporation.
Yasha Black: He is a former product manager at Ergo and a former JavaScript developer at Mail.ru Corporation.

ErgoDEX development roadmap

According to the share, the development roadmap of ErgoDEX is currently divided into 6 different phases. Consists of:

Phase 1: Develop core on DEX order book.
Phase 2: Developing core on AMM DEX.
Phase 3: Frontend development on AMM DEX.
Phase 4: Develop frontend on order book DEX.
Stage 5: Bringing ErgoDEX to the Cardano network.
Stage 6: Testing.

ERG token of the Ergo ecosystem

ERG is the native token in the Ergo home ecosystem. Here is some information regarding the ERG token:

General information

Symbol: ERG.
Total supply: 97,739,924 ERG.
Total circulating supply: 44,613,444 ERG.

Tokenomics

In ErgoDEX, each component is allocated with a specific role. There are five different types of components in the ErgoDEX ecosystem, including:

Miner: Processing transactions.
UI provider: Provides a better user interface.
Off-chain executor: Executes commands.
Liquidity Providers (LP): Provides liquidity.
Trader: Use DEX.

Each different component will benefit from using the DEX in its way:

Miners are earning mining fees paid in native tokens.
UI providers are charging a native token fee charged for each operation performed via the user interface.
Off-chain executors are earning fees paid in native tokens from both Order book and AMM services.
LPs benefit from protocol fees paid in tokens and accumulated in liquidity pools.
Traders benefit from the DEX services they use.

As such, ERG can be used to pay miner fees, UI provider fees, off-chain executor, and LPs.

ERG’s wallet and exchange

As for ERG exchanges, according to statistical data from CoinGecko, up to now, investors can buy ERG through exchanges such as KuCoin, Gate.io, Hotbit, HitBTC, etc.

For ERG wallets, investors can choose one of the wallets suggested by Ergo Foundation such as the Ergo desktop wallet, Ergo Wallet Android, or the Yoroi Web version.

Should invest in the ErgoDEX project and ERG coin?

As for the ERG coin, this is the common coin of the Ergo ecosystem. ERG price just peaked (early September 2021) at 18.14 USD. However, this peak is still lower than the peak (made in April 2018) at 29.58 USD

As for the ErgoDEX project, the project is currently in Beta, but it also has a few notable indicators as follows:

The volume of ERG mined in the last 24 hours is about 48,000 ERG.
The average digging speed is about 2.03 minutes.
The number of blocks mined is 712.

Another difference between ErgoDEX and other DEXs is that ErgoDEX applies both AMM and order book mechanisms. This makes it possible for ErgoDEX to accept both low and high liquidity trading pairs without being too biased towards one sector.

In addition, according to the published roadmap, the project is already more than half way through. When Cardano’s Alonzo hard fork came out, the AMM DEX was deployed. Thus, currently, ErgoDEX has only partially completed the AMM DEX feature and the order book DEX is still in the development stage.

Epilogue

Thus, after Minswap, Maladex, etc. on Cardano, we now have another DEX, ErgoDEX. The ecosystem on Cardano is gradually maturing. However, most of the projects are still in the development stage and have not officially launched their products.

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