Introduction

With the Exhausting Fork Combinator (HFC) ‘Alonzo’ approaching, more decentralized finance (DeFi) intermediaries are emerging for Cardano. A few days ago, Tim Harrison (Director of Communications and Marketing at Input-Output Global) said that there’s a huge interest displayed by developers towards the platform as well as its smart contract capabilities. A team of developers which was led by Quant Digital’s Ryan Morrison launched Cardax, basically a challenge which is conceived to be Cardano’s very first decentralized trade. The proposal made Cardano’s Venture Catalyst Fund 4 is looking for $50,000 that will be used to finance the Cardax. 

Decentralized finance is essentially a blockchain-based form of finance which doesn’t rely on financial intermediaries like exchanges, brokers or banks in order to offer traditional financial instruments, and instead uses smart contracts on blockchains. The most common one being Ethereum.

Cardano has managed to be counted as a part of the top 10 cryptocurrencies of the world by market capitalization in a short time. With a market capitalization of more than $41 billion, it ranks 7th and accounts for about 2% of the cryptocurrency market. According to CoinGecko, on April 14th 2021, Cardano hit an all-time high at $1.55.

Cardano DEX Roadmap

Morrison, a stakeholder operator in Cardano, and his team consisting of crypto enthusiasts that have experience working on projects like Open Ocean, Bitcoin EU and Celsius. The Cardano DEXteam wants to fulfil a few gps and challenges for Cardano’s ecosystem. The team has proposed to build a DEX that has the following characteristics: 

1. help for any of the Cardano native token which was launched with the previous HFC occasions, Mary and Allegra
2. provide liquidity suppliers with the ability to obtain charges collected on the DEX
3. Harness the EAMM protocol for liquidity-sensitive automated pricing
4. the flexibility to do business with ADA & different native tokens by way of Yoroi pockets
5. single transaction buying and selling
6. single transaction transfers

The challenge can have 6 phases of improvement which will probably comprise the creation of consumer interface, the system logic, consumer expertise and must-have options, backend, safety, protocol along with a last section for testing as well as improvement.

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The Cardax team said that with the accelerating adoption of Cardano as well as ongoing initiatives to back DeFi (a Cardano-based DEX) will serve as an powerful trading venue in the ecosystem.

The budget for the challenge is $50,000 is supposed to cover the cost of implementation of the first Phase 1 of this project. As described above, the focus of the first phase will be on the Cardax UI/UX (User Interface and User Experience) and system architecture. Unlike other centralized exchanges and their future competition in the Decentralized Finance sector, Cardax will be looking at leveraging a model with an order book as well as an automated market maker (AMM). Users of this platform will be able to harness from the dual model. The Cardano DEX will enable them to be ‘market makers’ with non-permanent risk of loss and minimal slippage. 

Cadano 2021’s Alonzo and Daedalus update

On April 1st 2021, Cardano’s team announced the finalization of Alonzo rule integration with the ledger. Moreover, it also investigated the integration with consensus and Plutus while fixing some value of minUTxO properties in Alonzo. The Cardano DEX team also announced the release of Daedalus version 4.0.3. The new version adds features like multi-asset option that enables users to send as well as receive native tokens as ‘Cardano’.

The release also includes the countdown to support for Trezor devices with passphrases, fully decentralized block production, a feature to view wallet public keys and an enhanced CSV export process, along with a few minor improvements and resolutions to some issues. ADA is buying and selling at $1.21, with facet motion that’s within the hourly chart. A downtrend on greater timeframes after the final sentiment in the crypto market.

Conclusion

Cardano’s decentralized finance (DeFi) ecosystem is growing rapidly, with the upcoming Exhausting Fork Combinator (HFC) ‘Alonzo’ set to open up more opportunities for decentralized applications. One such development is the launch of Cardax, Cardano’s first decentralized exchange (DEX), backed by the Venture Catalyst Fund 4. Led by Ryan Morrison and his team, Cardax aims to provide a unique trading platform by combining an order book and an automated market maker (AMM) model. This innovative approach allows users to trade native Cardano tokens with minimal slippage and no permanent risk of loss. As Cardano’s adoption grows, the Cardax project is expected to serve as a key player in enhancing the Cardano ecosystem’s DeFi offerings.

FAQs

1. What is Cardano’s Cardax project?
Cardax is Cardano’s first decentralized exchange (DEX), designed to provide a platform where users can trade Cardano native tokens using a combination of an order book and an automated market maker (AMM) model.

2. What is Decentralized Finance (DeFi)?
DeFi is a blockchain-based financial system that operates without intermediaries like banks or exchanges. It uses smart contracts on blockchains, enabling peer-to-peer financial transactions.

3. How does Cardax differ from centralized exchanges?
Unlike centralized exchanges, Cardax is decentralized and will use a hybrid model with both an order book and an AMM. This approach allows users to trade Cardano’s native tokens with reduced slippage and no permanent risk of loss.

4. What is the goal of the Cardax project?
The goal is to create a decentralized exchange that supports Cardano native tokens launched in previous hard fork occasions and allows liquidity providers to earn transaction fees. It also aims to provide a seamless trading experience through features like single transaction trading and integration with the Yoroi wallet.

5. What is the funding for Cardax?
The Cardax team is seeking $50,000 from the Cardano Venture Catalyst Fund 4 to implement the first phase of the project, which will focus on developing the user interface, system architecture, and other essential features.

6. How does the Cardano ecosystem support DeFi?
Cardano’s ecosystem is rapidly evolving, with the Alonzo update enabling smart contract functionality, making it an attractive platform for DeFi projects like Cardax. As Cardano’s adoption grows, it is expected to become a major player in the DeFi space.

7. What is the significance of the Alonzo and Daedalus updates?
The Alonzo update introduces smart contracts to Cardano, which enables DeFi applications like Cardax. The Daedalus version 4.0.3 update adds features like multi-asset support, improved wallet capabilities, and enhanced security.

8. How does the AMM model work on Cardax?
The AMM model allows users to trade assets without needing an order book, providing automatic pricing based on the liquidity pool. This ensures minimal slippage and makes it easier for users to trade tokens.