From the perspective of protocol types, there are currently two main solutions for decentralized derivatives:
In the Vault model represented by GMX, LP acts as the trader’s counterparty, and the transaction price is determined by the Oracle price feed.
The order book model represented by dYdX combines off-chain matching and on-chain settlement.
Although these two solutions are widely adopted by the market, they have some potential risks. The Vault model is prone to Oracle price manipulation, resulting in losses; and the off-chain matching and on-chain settlement of the order book lack transparency.
Among the many decentralized derivatives protocols in operation, the influence of a single protocol is limited. The entire on-chain derivatives trading market is still in its wild age, and the market structure is undetermined. How to win in this competition is a huge challenge for each existing protocol to determine its future.
ZKX, a derivatives protocol based on the Starknet ecosystem, also adopts the order book model, but through differentiated deployment, it provides users with an on-chain trading experience and security that is comparable to or even exceeds the fluency of CEX. OG Trade and Pro Trade provide a variety of trading options for users of different levels; ZKX AppChain records all trading processes on the chain, combining transparency and security; ZKX accounts and Starkway provide new users with seamless onboarding channels and simplified procedures.
ZKX Background Information
ZKX was founded in 2021 by two of its founders, Eduard and Naman, who previously held leadership positions at SOSV, one of the world's top venture capital firms with over $1.2 billion in assets under management. The main team has experienced people from companies such as PayTM, Flipkart and Byju's, spanning 8 countries.
ZKX received funding from StarkWare (Starknet's parent company) in April 2022. In July 2022, ZKX raised US$4.5 million in seed round financing. Investors included StarkWare, HashKeyAmber Group, Crypto.com, and DragonFly Capital general partner Ashwin Ramachandran.
ZKX makes trading social by providing gamified trading options to provide users with a more interesting trading experience. Using ZKXAppChain, ZKX combines the efficiency of CEX with the self-custody and trustlessness of DeFi to provide wider scalability and high-speed APIs. ZKX is currently deployed on Ethereum and Starknet. According to official X data released on June 5, in the past 30 days, ZKX's trading volume reached US$2.3 billion, ZKX account creation volume exceeded 24.6K+, transactions exceeded 2 million, and STRK's trading volume alone exceeded US$300 million.
ZKX’s protocol token $ZKX TGE will be held on June 19th, and it has been confirmed that it will be listed on Kucoin and Gate at the same time. The first round of airdrops promised to users have also been distributed to users’ accounts at 3 pm on June 17th.
AND Trade & Pro Trade
Most on-chain derivatives platforms use static trading pages, and traders of different levels are forced to use the same interface, leaving users with no choice. ZKX innovatively divides trading into OG Trade and Pro Trade for users of different levels.
OG Trade introduces gamification elements to provide a simpler and more interesting trading experience for short-term and swing traders. OG Trade offers 30-minute trading competitions and visualizes real-time trading data on the interface to help novice users gain trading profits in a short period of time.
Profit, loss and volume are rewarded with unique gold, silver and bronze badges, unique to each category. These badges signify the user's worth as a trader in the OG Trading Contest.
Pro Trade is designed for more experienced intermediate and advanced traders, including all types of orders, complex trading functions, public APIs, advanced tools, etc. Professional traders, big capital players and proprietary trading companies can easily trade on Pro Trade.
OG Trade and Pro Trade meet the needs of different types of traders through two different methods. However, users still do not need to worry about liquidity and depth issues because both trading methods share the same on-chain order book on ZKX.
ZKX AppChain bridges the gap between performance and security
Some on-chain derivatives protocols use the order book model to improve performance, such as dYdX, Aevo, etc., but this form is operated in an off-chain matching and on-chain clearing mode. The off-chain matching process lacks transparency and has a certain risk of malicious behavior. ZKX perfectly bridges the gap between performance and security through ZKX AppChain.
ZKX Appchain is a full-chain layer developed using Substrate SDK, which seamlessly connects users to ZKX through multiple L1s and Rollups. There is an intermediate layer in its stack that is responsible for synchronizing assets and state data between Starknet and parallel Rollups built using its SDK and ZKX AppChain. Therefore, ZKX AppChain is actually an L3 public chain based on the Starknet ecosystem.
The ZKX order book runs entirely on the ZKX AppChain. Transactions on ZKX are not subject to any on-chain speed and gas cost restrictions. Even if there is congestion on the chain, ZKX users can still enjoy smooth gas-free transactions and continuous liquidity and operability.
On Appchain, the order book and Substrate manage transaction processing and verification, and any transaction records are traceable and queryable, which further enhances the decentralization and transparency of ZKX and makes secure and reliable on-chain derivatives transactions possible.
ZKX has expanded to 3 blocks per second and supports more than 2,000 API requests every 10 seconds. This efficient gas-free transaction can provide users with a CEX-like trading experience while ensuring the security of user assets.
ZKX AA Account
Although most on-chain derivatives protocols are using various strategies to attract new users, the threshold for on-chain operations is extremely high, which is the most fundamental reason why new users cannot transfer transactions from CEX to the chain. How to lower the entry threshold for new users and allow these users to seamlessly experience the decentralized trading system is the current focus.
Account abstraction is a must for mass adoption of blockchain, with a seamless experience similar to CEX, while having the security and privacy provided by DEX. ZKX is the first platform in the decentralized derivatives protocol to integrate account abstraction. Leveraging Starknet's native account abstraction and Starkway as an L1 to L2 bridge. ZKX AA accounts are currently deployed on the Starknet mainnet using Cairo 1.0. In the future, it will be expanded to other L1s and more Rollups to provide users with a seamless full-chain trading experience.
Using a ZKX AA account simplifies the process of recording private keys and accessing funds. As a decentralized account on Ethereum L2, users can seamlessly bridge to Starknet and start gas-free transactions directly using the ZKX AppChain without multiple complicated steps. The ZKX AA account will also become a one-stop DeFi application hub for users, with features for staking and other DeFi products in addition to perpetual transactions, all contained in a user-centric DApp.
Starkway Native Cross-Chain Bridge
In the multi-chain era, cross-chain bridges are important infrastructure for connecting blockchains. Starkway consists of Solidity smart contracts on Ethereum and Cairo contracts on Starknet. Through the L1-L2 messaging mechanism provided by Starkware, Starkway can help users seamlessly transfer funds between L1 and Starknet through a trustless and transparent mechanism.
Currently, users can use Starway to easily deposit directly from Ethereum L1 to ZKX AA accounts on Starknet, and can also be used in ZKX activities such as airdrops and clan NFTs. Starkway also has a messaging function, and ZKX can check the eligibility of L1 wallets and distribute rewards accordingly.
Through Starkway, ZKX has opened up the channels for funds to flow in and out. Different chains are no longer barriers to funds, and users can seamlessly experience any service provided by ZKX.
Conclusion
The decentralized derivatives trading market is on the verge of an explosion, with trillions of dollars of growth potential. At present, the overall pattern of on-chain derivatives protocols has not yet been finalized, which provides a valuable breakthrough opportunity for innovative projects and is also a critical moment for competing for market share.
The core advantage of ZKX is that it uses a decentralized order book with high performance and high liquidity. Combined with ZKX AppChain and ZKX AA account, it enables users across the chain to use ZKX services securely and seamlessly in a simplified process. It provides users with smooth and gas-free transactions comparable to CEX, while also having the security and decentralization of DEX.
Through a unique differentiation strategy, ZKX is committed to solving problems and risks in existing protocols and is a strong competitor in the decentralized derivatives market.
ZKX tokens will be available for trading on June 19th. The total amount of $ZKX tokens is 100 million, with a small initial circulation. The IDO valuation is 50 million US dollars, which is reasonable. You can pay attention to the price after listing.
