DeFi capital spillover is an indispensable factor for MDEX’s rapid development, but its own product design is also the key.
Written by: Holmes
From the opening of liquidity and transaction mining on January 19 to the present, the decentralized transaction protocol MDEX has rapidly grown with the popularity of the Huobi ecological chain. Since its birth, it has surrendered a locked position in just two months. The peak volume exceeded US$2.1 billion, the peak daily trading volume exceeded US$5 billion, and the cumulative trading volume exceeded US$100 billion.
The hotness of the crypto market at the beginning of the year and the DeFi capital spillover caused by the high transaction cost of Ethereum network congestion and other external factors fueled the flames are indispensable factors for MDEX’s rapid development. The polished design and innovative design are also key.
Highlights of MDEX
Just like the slogan on the MDEX official website, “Heco eco-currency trading, choose MDEX as soon as possible.” In the process of polishing the product, the platform is chasing the goal.
Much: As of March 9, MDEX has 2,703 trading pairs. In addition, MDEX’s trading depth has reached 60,000 ETH (approximately US$78 million), which basically guarantees the stability of the trading system in response to market changes.
Fast: MDEX’s transaction processing time is about 3 seconds, which is lower than the average transaction processing time of about 20 seconds on Uniswap. Considering that the transaction efficiency will further decrease when the Ethereum network is congested, the transaction speed of MDEX has increased significantly compared to Uniswap. MDEX is built and operated based on Heco’s high-performance public chain. The theoretical TPS of the Heco chain can reach up to 500, and the transaction confirmation time is about 3 seconds. DeFi users can get a good experience when trading on MDEX.
Province: When Uniswap trades 1000USDT, it not only needs to pay a 0.3% transaction fee of 3 US dollars, but also an average gas fee of 30 to 50 US dollars. For transactions of the same scale in MDEX, the handling fee is also 3 USDT, but it can be refunded through transaction mining. More importantly, the gas fee for a single currency transfer of $0.01 is negligible. The transaction fee subsidy for MDEX users exceeded 310 million U.S. dollars, and the cumulative LP reward was 210 million U.S. dollars.
Good: MDEX, as a representative project in the Heco ecosystem supported by Huobi’s concentrated ecological resources, has a significant wealth effect. As of March 9, MDEX has provided liquidity providers (LP) with a total of more than 210 million U.S. dollars in rewards. In the context of a slight decline in DeFi popularity, MDEX still has 33 mining pools with APY over 100%, while the lowest APY for trading mining pools is 14,112%, and the highest is 1,421,938%.
Innovative “Dual Chain and Double Mining”
At the end of August last year, SushiSwap launched a “blood-sucking attack” on UniSwap through liquidity mining to plunder Uniswap’s liquidity, and once occupied the second seat of the Ethereum DEX, let the market more deeply realize the importance of users and liquidity in the DeFi world. In this profit-oriented market, products are not enough to produce unbreakable stickiness. How to provide as high a profit as possible under the premise of controllable risks is the true expression of competitiveness.
Based on this, MDEX innovatively proposed the concept of “dual chain and dual mining”. The dual-chain means that it supports both the Huobi Eco-Chain and Ethereum, and also supports the liquidity market-making mining and transaction mining of DEX. Liquidity mining needs to pledge dual currency liquidity to provide proof (LP Token). MDEX not only supports dual currency LP mining pools, but also supports single currency mining pools. Transaction mining is equivalent to adding a layer of “leverage” to the foundation of dual liquidity mining.
When a user participates in transaction mining, the user gets MDEX’s governance token MDX reward, and the amount of the reward will be determined according to the transaction volume. According to the data disclosed by MDEX, up to now, MDEX transaction mining has subsidized users more than 310 million USDT in handling fees. According to its subsidized handling fee, the average transaction fee per user is basically zero, because the MDX token rewards generated by mining have covered the required handling fee.
Unlike most DeFi tokens on the market that are only used for governance, MDEX’s token MDX integrates the governance of DEX tokens, the financial value capture of CEX tokens, and introduces the mechanism of “repurchase destruction” and “repurchase rewards”. Become the first decentralized transaction protocol that supports the repurchase and destruction of platform coins by commission. According to the rules, MDEX’s platform revenue mainly comes from transaction fees of 0.3% of the transaction volume. Of the 0.3% handling fee of the transaction volume, 0.1% will be used to promote the development of ecological projects, 0.14% will be used to reward mining users, and 0.06% will be used to repurchase and burn MDX, and Boardroom will receive a fixed weekly reward of USD 9.52 million. As of the afternoon data of March 10, the total number of MDEX repurchases and burns exceeded 10 million MDX, and the total repurchase amount was approximately US$39.4 million.
MDEX’s next step
The “overfire” of DeFi has caused Ethereum to be in a difficult position, but it provides a good opportunity for the new public chain to overtake. Centralized exchanges have built public chains, developed and cultivated the DeFi product ecology, and are compatible with the Ethereum EVM. It is friendly to the users, and at the same time induces the exchange’s currency listing resources and traffic support to undertake the traffic overflow of Ethereum.
MDEX CTO SKY said in an exclusive interview with Lianwen that MDEX first chose the Heco chain because of performance, community and timing considerations. However, MDEX is not only satisfied with Heco’s “one corner”, but hopes to create a DEX with the best user experience in the entire DeFi field. Version 2.0 products that will be launched in the second quarter will be deployed in multiple chains on public chains such as Ethereum (supporting Layer 2 networks), BSC, OKChain, Polkadot, Near, etc., to achieve asset interoperability and create a full ecological transaction protocol. At the same time, MDEX is testing and deploying cross-chain protocols between Heco and other public chains, allowing MDEX users to switch with one click and freely transfer and trade their multi-chain assets.
MDEX has now become the portal of the Heco ecosystem and the primary issuance place for Heco’s new assets. According to SKY’s disclosure, in the second quarter, MDEX will not only provide users with pending order trading services, but also allow users to enjoy CEX-like trading experience on DEX. It will also provide project parties with transparent, open and customizable financing services for more The assets of the company provide trading services, thereby further expanding its transaction scale.
It has always been the pursuit and goal of star cross-chain projects such as Polkadot and Cosmos to break the data island of the public chain and realize the transfer and circulation of value assets. Based on user traffic and asset advantages, MDEX cuts in from the perspective of DeFi applications, user needs and experience. Instead, it is possible to come first and take the lead in realizing cross-chain application landing scenarios. At present, as long as the liquidity and assets are connected across the chain by means of cross-chain bridge asset mapping, and users accept and are willing to conduct cross-chain asset transactions, the volume growth and chemical reactions of DeFi and the entire cryptocurrency market cannot be underestimated.
summary
MDEX intends to create a new business ecosystem with full-scenario coverage, full-ecological deployment, and full-chain connectivity, continuously expanding application scenarios, lowering the threshold of use, and providing global users with more convenient, high-performance, low-cost, undifferentiated financial services and realizing assets Fair pricing, instant settlement of transactions, and free flow of value.
At present, MDEX lock-up volume is about 1/2 of Uniswap and less than 1/2 of Sushiswap. The cumulative transaction volume is about to exceed 100 billion US dollars in only 50 days, while Uniswap takes 840 days; however, the circulating market value of MDEX token MDX is only 1/15 of UNI and 1/5 of SUSHI. If the valuation logic is similar, then the value discovery of MDX should have just begun.
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