Join the foremost cryptocurrency and Web3 conversation taking place April 26-28 in Austin, Texas.
Bancor, a decentralized exchange (DEX) built on the Ethereum network, has launched an on-chain trading platform, Carbon.
The release comes after Bancor’s decentralized autonomous organization (DAO) published a proposal to deploy on Ethereum, with 100% of votes in favor of launching. Bancor uses an automated market maker (AMM) smart contract — a mechanism designed to provide liquidity to the market.
Carbon aims to make DEX trading easier and more advanced through the trading functionality of centralized exchanges (CEXs) and the access and transparency of AMMs.
Carbon will create a single, centralized liquidity position that will only buy and sell within a specific price range. “The buy and sell range can be above or below a set price, depending on where the user expects a given token to trade, automating the swing trading process for any ERC-20 token,” the press release states.
Nate Hindman, Bancor’s head of growth, said liquidity pools typically require users to provide liquidity across a continuous price range, while Carbon gives users the ability to distinguish between buy ranges and sell ranges.
Customers will be able to “use a single liquidity position to set a buy range [buy $2,000-2,100 worth of ETH, for example] and a separate sell range [sell ETH between $2,300-2,400],” Hindman told CoinDesk.
As ETH moves between these ranges, this will enable users to buy tokens low and sell them high. Liquidity automatically rotates across user ranges to fill orders. Hindman said this is a similar model seen on centralized exchanges but lacking on DEXes. “Bringing CEX trading functionality to DEXs is key to driving the next wave of on-chain traders,” he added.
