There is a great debate between the merits of full decentralization. With such a system, there are trade offs. This becomes very important when trading. In this arena, time is of the essence and one of the drawbacks to decentralization is that it tends to be slower than centralized systems.
Of course, the fact that centralized systems can be hacked is a major strike against them, especially when it comes to cryptocurrency. We are all aware of the hacks that took place over the last few years resulting in the loss of hundreds of millions of dollars worth of cryptocurrency.
For this reason, a new application is going onto the Bitshares network that will be a hybrid model. It will implement aspects of both systems in an effort to create a better trading platform of the Bitshares blockchain. This is done to get it going as quickly as possible.
Leveraging the Smartcoins on the Bitshares platform, DEVX will be built as a wrapper on Bitshares which will allow it to offer the speed of centralized systems. Traders assets are protected since each Smartcoin is backed by Bitshares tokens as collateral. Under this circumstance, the user can always claim the collateral.
All trades will take place like they do on normal exchanges. The difference is they will be buffered and posted to the blockchain later in batches. This ensures the transparency that people expect with blockchain.
To counter this problem, recent exchange projects have adopted hybrid, off-chain solutions rather than remain 100% on-chain. Such hybrid approaches are meant to enable the resulting solution to process more intensive market related and trading related tasks using modern, time tested approaches off-chain, but also conduct final settlement on-chain. This helps diminish exchange costs yet providing a trustless setup for many of the most important components.
DEVX handles the order creation and matching outside the BitShares blockchain since the alternative would make the trading too expensive and slow. The DEVX Transient Protocol ("DEVTP") empowers the platform to remain deft while quick upgrades are made to guarantee versatility of the network.
The revenue distribution from the trading fees will be spread to the token holders. It is designed to be a 50/50 split with half going for maintenance and the other half going to the community.
Full post by the development team:
This is exciting news for the Bitshares blockchain. It is another step in the evolution of that system. "Wrapping" is something that we are going to see going forward with some of the newer developments being worked on by a number of Bitshares' teams. It is also something that @stan mentioned as a part of the BENCH project that is being created.
Bitshares appears to be leading the way towards interoperability and cross-chain interaction. It could be possible that multi-chain applications are just around the corner. This is a necessary step for the advancement of the entire industry. Fragmentation does not lead to mass adoption. People cannot be bothered with switching between blockchains (which means going to different wallets). For the average person to use it, a wallet system needs to be in place that can handle it all (or most of it).
The other piece here is that it looks like DEVX is seeking to offer simplicity. Thus far, many of the Bitshares applications are a bit too technical for the average person. Many traders seeks to chart, trade, and do it again. Taking a lot of time to learn difficult platforms does not interest them. From the shots provided, the application looks rather simple along with being eye-catching.
Once again, we see another development that could help attract more people to blockchain. The DEVX exchange could well serve as a bridge to some more mainstream people.
By the way, as per the usual, none of this is to be considered financial advice.
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