0x Wiki ▷ What is ZRX? Crypto currency & more!
The 0x Coin (ZRX) has made waves in the crypto-currency space and has caused great excitement among investors. We will explain what the 0x Coin is and why it has received a lot of attention. Bitcoin-News.one always recommends caution before making crypto currency investments, and we recommend that you do your own research.
What is the 0x Coin?
First of all you should know that 0x is also generally referred to as ZRX-Coin. People often use one of the two terms, but they are talking about the same crypto currency. The 0x team describes its project as "an open protocol that allows reliable and smooth exchange of ethereum-based assets". So what does this mean?
Currently, thousands of different digital assets exist on the Ethernet block chain. A classic example would be anERC20 token.
TheseERC20 tokens are digital tokens based on theEthereum block chain and are issued by cryptocurrency projects that have started their own ICO. The0x join is an example of an ERC20 token. Essentially, ERC20 tokens are Ethereum's solution for creating an ICO quickly and easily.
With all these different digital assets based on Ethereum, it is difficult to communicate with each other. In simple terms, 0x is trying to make it easier to exchange one Ethereum-based digital asset for another. For example, if you trade the ZRX coin for Ethereum.
0xis known as "public infrastructure". This means that 0x creates the method for replacing one Ethereum-based asset with another. It is essential to know that 0x is not an application. Instead, the 0x methodology is used by various applications and platforms that want to have access to the asset exchange. Cryptocurrency Exchanges are an example of 0x solution-based platforms.
Why you should use 0x
What exactly distinguishes the ZRX coin from other crypto currencies?
In short, 0x tries to make the exchange of assets faster and cheaper.
Ethereum was a pioneer in the creation of the Smart Contract. This digital contract enabled the exchange of digital assets between partners without the need for a third party.
Why is it important to know this? Before Smart Contracts were created, the crypto-currency exchanges had to be centralised. This meant that exchanges had to be operated by third parties who supervise transactions. Virtually every known crypto currency exchange such as Coinbase, Kraken or Binance is currently a centralised exchange. The problem with this type of exchange is that user funds are stored centrally and can be hacked.
However, the crypto currency exchanges continue to evolve and in recent years the decentralized exchanges have increased. On these exchanges, individuals exchange actual digital assets peer-to-peer and there are no middlemen involved in the transaction. This means lower fees and better security guarantees.
Many in the crypto-currency industry see decentralized exchanges as the revolution in crypto-currency exchanges. 0x and the concept of exchanging digital assets for other assets makes it the ideal solution.
How does the ZRX Coin work?
The problem for decentralized exchanges is that the trading process is still very inefficient, which leads to high costs for the market makers. This makes decentralized exchanges less attractive for market makers and leads to low volumes on these exchanges.
Are the costs at decentralized stock exchanges currently high? Basically, every time a trade is executed, a Smart Contract is created to execute the command. Each Smart Contract that is created requires a fee to be paid in Ethereum to ensure that the order is executed.
This means that in a decentralized exchange you pay a fee for the deposit on the exchange, a fee for the exchange of a crypto currency and a fee for the withdrawal. These fees add up and considerably reduce the attractiveness of active trading on decentralized exchanges. However, this also means that decentralized exchanges offer more security guarantees than centralized exchanges.
The ZRX Coin aims to solve these decentralised exchange problems by using off-chain relays, basically the ZRX Coin has found a way to move a significant number of transactions outside the network and ultimately handle everything in a single on-chain transaction. This means that only one fee is paid for Smart Contracts. This means that, in principle, fees only have to be paid if two different crypto-currencies are actually traded, so that fees for creating or changing orders are no longer required.
Important concept: liquidity & order books
Crypto currency exchanges are about having a so-called liquid market, liquidity means that there is a lot of activity in a market. This means that an asset can be bought or sold quickly without affecting the price.
The easiest way to explain order books and liquidity is to look at the betting market on the Betfair exchange. In a football match against two unknown teams, Mbabane Swallows and Etoile du Sahel, bets are on a draw.
The order book is the amount of money people are willing to bet on a particular event or bet against an event with a particular price. Here we see that people on Betfair are prepared to risk £19 if they bet 25 to 1 against a tie. So a speculator on Betfair can only get £19 at that price. However, another £22 is available at worse odds of 24 to 1 and £65 at 22 to 1.
Liquidity is important because if we wanted to bet £5,000 at the draw for this football match at the current 25 to 1 ratio, we will be prevented from doing so. Instead, in this situation, we can only bet £19 at the current odds and for the rest of our bet we would get constantly falling odds. Betfair's very thin order book makes the market very liquid.
Something similar happens with crypto currencies. In order to offer you a fixed price for a coin, there is an Order Book behind it.
How is 0X Coin able to solve the liquidity problem?
Now you know why there is not much trading activity in an iliquid market. The liquidity problem is therefore a major problem for decentralized stock exchanges.
The0x Coin has solved this problem by allowing anyone to keep a public or private orderbook and charge a fee for liquidity. The companies or individuals who own these order books are called relays. These relays increase the liquidity of the 0x platform and facilitate trading between brokers and users.
An example of an order book producer: A person who has 10,000 0x coins and is willing to sell for $1.10. A buyer would be a person who wants to spend $11,000 on 0x coins and is satisfied with a price of $1.10. The Relayer can be seen as a value-added product and earns a fee to enable this trade, thus earning additional ZRX Coins.
It is important that the relays do not actually process the transaction. Instead, everything is done through a Smart Contract and the relayer does not take possession of any funds. This means that the transaction can be carried out in a trustworthy manner and without third parties.
With a view to reducing Smart Contract fees, everything (until the final trade between the buyer and the manufacturer) is handled outside the network and does not use a Smart Contract. This means that fees are only charged for the actual transaction and not for placing the order.
Point to point orders are essentially peer-to-peer transactions. In this case, a manufacturer wants to trade with a particular participant. Basically, the manufacturer can send an order relay in peer-to-peer mode and only the designated participant can pass the trade.
Why is this function important? Large digital asset trades are generally not carried out on central or other centralized exchanges. Instead, they occur in over-the-counter markets. Over-the-counter companies are the places where the big players go to trade crypto currencies. For example, the OTC operator might have orders for 100 million euros to buy or sell ZRX coins to other people. The OTC operator would execute this order off-exchange to ensure that the price of the asset does not move.
If a 100 million Euro order for a crypto currency was placed within an exchange, it would change the price of the asset guarantee. Crypto is still a relatively small market and is not liquid enough for such large orders. By using an over-the-counter solution, massive buyers and sellers of crypto currencies avoid these problems. This is where 0x Peer-To-Peer orders become especially useful.
How is the ZRX Coin used?
Basically, when someone exchanges crypto currencies using the 0x protocol, all fees are paid with the ZRX coin. Relayers are also rewarded in ZRX Coins for the liquidity they provide to the platform. In short, if there is a fee associated with the use of 0x, it is paid through the ZRX coin. The coin also plays a role in maintaining and voting on future protocol changes.
The 0x Team
The 0x project has the potential to take the next step in the cryptographic currency exchange revolution. But every major project needs a team capable of taking the market to the next level. The 0x team is 18 people strong. Bitcoin-News.one is impressed by the diverse skills & experience the 0x team has to offer. In fact, a considerable number of former employees from Apple, Facebook and Google are involved in the project. Due to lack of space we are unfortunately not able to cater to every team member. But we will give you an overview of the 0x founders.
Co-Founder & CEO - Will Warren: Unlike most founders of tech companies, Will holds a degree in mechanical engineering from the University of California San Diego. He then went on to earn his doctorate in structural engineering at the same university.
He later became a technical consultant for Basic AttentionToken and then co-founded the 0x project.
Co-Founder & CTO - Amir Bandeali: Amir began his professional career at the Universityof Illinois and completed his BSc in Finance. Amir followed his interest in the financial markets and accepted three trading assignments with Chopper Trading and DRW. Apparently Amir thought that his knowledge of trading in financial markets could be better utilized and decided to co-found 0x.
The future of 0x
The0x project has already achieved a lot in its short lifetime. In mid-2018 Coinbase acquired the Paradex exchange - Paradex uses the0x protocol. With this latest acquisition, it would not be surprising if Coinbase were to integrate 0x technology into its entire platform in the future.
0xhas the potential to be the next step in the development of crypto trading. With crypto currency exchanges like Binance (which made more profit in 2018 than Deutsche Bank), it is not surprising that operating a crypto currency is very lucrative.
However, trading hack attacks are a problem in the market. 0x offers a way for exchanges to provide more security to their customers while reducing decentralized exchange fees.
We have no doubt that 0x will benefit from increased acceptance as the crypto currency markets grow. In fact, this could potentially be the building block on which any future crypto trade will be built.
The 0x ICO
The0x ICO took place in August 2017 and raised 24 million dollars. The project's early donors were able to commit to the project for only $0.048 per ZRX coin.
Since then, the coin has become one of the 25 strongest crypto currencies. This shows that an ICO does not have to earn $40 million (like some other crypto projects) to establish itself in the market. Although 0x has raised less money in its ICO than other projects, it still remains one of the best funded crypto currencies on the market.
Should I invest in the ZRX Coin?
- Decentralized exchanges are widely seen as the future of crypto-exchanges. 0x solves the major shortcomings of centralized exchanges. This should make 0x more competitive with its central partners in the future.
- The demand for the0x protocol should increase with rising crypto currency prices: As crypto prices rise, centralized exchanges will become increasingly targeted by hackers.
- The ZRX Coin has a sensible use case.
- The protocol currently only supports Ethereum-based assets.
It is not predictable whether exchanges like Binance will use the 0x solution or create their own solution.
How can I buy the 0x Coin?
Coinbasehas recently announced that they may listZRX Coins in the near future. Once that is the case, this is the easiest way to buy 0x. At the moment our recommended method is a combination of Coinbase and Binance. Our simple buying guide will explain step by step how to buy 0x.
There is no doubt that trading is a big business. This makes 0x one of the few companies in the industry that is currently generating actual cash flow. The problem with Exchanges is that most of the trading volume takes place on central exchanges. This creates an environment in which cryptoinvestors run the risk of being hacked.
0xcreates a crypto-currency ecosystem where investors do not have to take the risk of using centralized exchanges. This allows them to take advantage of the benefits of a centralized exchange, but with the added security that decentralized exchanges offer. Furthermore 0x reduces trading fees
TheZRX Coin has positioned itself to play a key role in the crypto exchange industry. TheBitcoin-News.one-Team would be pleased to support other non-ethereum based assets such as NEO . However, we are confident that the 0x team will implement this support in the future.
In summary, we like BC1 0x as an infrastructure game, especially since it is well positioned in the most lucrative area of cryptoeconomics.