0x Review: Everything About the Protocol Explained
Our 0x review is about to explain to you everything about the protocol. The protocol is on a mission to assist blockchain technology in creating a tokenized world and unlocking its value. And also make it readily available to all.
Blockchain technology has given many people the opportunity to attain financial freedom through its global DeFi system. It supports the tokenization of various forms of value in the system like a debt instrument, fiat currencies, stocks, and reputation.
The project has a feature that makes it one of the most ‘user-friendly’ trading portals available in the crypto market.
This 0x review gives more insight into what the protocol is all about. The information readers will get includes the 0x founders, the unique features, how it works, and many more. It is a sure guide to beginners and individuals who wish to know more about the protocol.
- 1 About 0x Founders
- 2 What is 0x (ZRX)?
- 3 How Does 0x Work?
- 4 What Make 0x Unique?
- 5 What is 0x (ZRX) Token?
- 6 0x (ZRX) Token in Circulation
- 7 What Adds Value to 0x?
- 8 How to Use 0x
- 9 How to Buy ZRX?
- 10 What is the best Wallet to Store 0x?
- 11 Conclusion of 0x Review
About 0x Founders
There are 32 people on the 0x team. These members come with qualifications ranging from finance, design to engineering.
Will Warren and Amir Bandeali co-founded the protocol in October 2016. Warren is the CEO, while Amir functions as the Chief Technology Officer (CTO). Both of them are researchers in ‘Smart Contract’ development.
Will Warren is a graduate of Mechanical Engineering from ‘UC San Diego.’ He became one of the workers in BAT (Basic Attention Token) as a Tech. Advisor.
Also, he took the Ist position in the Proof of Work competition of 2017. Moreover, Warren always conducts researches on applied physics in the National Laboratory at Los Alamos.
Amir Bandeali studied Finance at the University of Illinois in Urbana-Champaign. After his studies, Bandeali worked as a (trading) specialist at ‘Chopper Trading’ & DRW.
Also, 0x project has five advisors in addition to the main team. They include; Fred Ehrsam, the co-founder of Coinbase, and Joey Krug, the co-CIO of Pantera Capital. The other team members comprise end-to-end ‘business’ strategists, product and graphic designers, software and other engineers, and other skilled personnel.
The 0x token is the ZRX coin. Its first ICO (initial coin offering) was in August, the year 2017. It started selling out shortly afterward (after 24hours), recording daily sales of about USD 24million.
What is 0x (ZRX)?
0X is an ‘open sourced’ protocol that supports a decentralized exchange of tokens on the Ethereum Blockchain. It facilitates the peer-to-peer exchange of assets in a cost-effective and frictionless manner.
The protocol base Ethereum ‘smart contracts’ that allow people from different parts of the world to access a ‘decentralized exchange’ system.
The main mission of the 0X project team is to have a reliable and free platform for smooth token exchange. Also, they hope to see a world in the future where all assets will have token representatives on the ‘Ethereum network.’
Moreover, the team believed that there would be a lot of tokens from (Ethereum) blockchain that 0X can efficiently help users to exchange with this process. For instance, if someone sells a car to B, the 0X protocol offers a detained solution that converts the value of the car to its token equivalent.
Then swap ownership with B (the buyer) via a Smart Contract. This makes the process easy. The long protocol of involving the agents, lawyers, and title companies is no longer necessary. It increases the entire speed of the process and reduces intermediary expenses.
The features of 0x are not entirely centralized or decentralized. But combine these approaches to deliver possible best results. The 0x launch kit is one of the unique features. It enables a user to create a personalized DEX (decentralized exchange) 0x. With this personalized DEX, users can decide to impose certain fees on the services they render.
In addition to the launch kit, the 0X team introduced an application programming interface API that combines liquidity across the whole system. This allows users to exchange assets always at good rates.
How Does 0x Work?
0x uses smart contracts that can be adopted into any Dapp (decentralized application) to facilitate the decentralized token exchange. This smart contract is free and easily accessed by the public. A ‘smart contract’ is a ‘contract’ that executes automatically when conditions initially agreed on are met.
The 0x protocol uses 2 things to execute any task:
- Ethereum Smart Contracts
The step by step explanation of the working relationship is written in 0X protocol white paper as outlined below;
- Maker accepts the DEX (decentralized exchange) contract giving it access to the token balance available A.
- Maker indicates interest to give out token A for another token B (initiates an order). They state the desired rate of exchange, the time the order expires, and endorses the order using a personal key.
- Maker announces the signed order via any communication medium available.
- The owner of token B (the taker) accesses the order. They decide whether to fill it or not.
- If the decision in ‘d’ is yes, the taker allows DEX contract access to their token (B) balance.
- Taker submits Maker’s signed order to (decentralized exchange)DEX contracts.
- The (DEX) contract verifies the Maker signature, ensures the validity of the order, and guarantees that the ‘order’ has not been filled already. DEX uses the exchange rate as specified to transfer tokens A and B to the 2 parties.
Almost all decentralized exchanges make use of Ethereum ‘smart contracts’ to facilitate their trades. This process is done on the ‘blockchain’ directly. It implies that each time one fill, cancel or modifies an order, he or she incurs a transaction fee known as (gas fee). This charge makes the process look expensive.
However, the solution 0x proffers to this challenge is using an ‘off-chain’ relay with an ‘on-chain settlement. This entails a user submitting their order direct to the network bulletin-like board known as relayer. The ‘relayer’ immediately broadcasts this order off-chain for other users who wish to fill it by forwarding to smart contract their ‘cryptographic’ signature.
Moreso, 0x also supports end-to-end orders. Here, a user creates an order which only a particular person can fill.
Generally, 0X store orders off-chain and handle trade settlements on-chain. Assets are not kept in the relayer’s custody, and the transfer of actual value occurs on-chain only. This reduces the gas fee significantly and decongests the network.
What Make 0x Unique?
Warren and his co-founder Bandeali had the vision of solving the challenges that will arise from the tokenization of assets in the future. With 0X, they hope to address the loopholes of ‘decentralized’ crypto exchanges and the inability of some exchanges to relate.
This concern made them design 0X with these unique features.
Off-chain relayer: This technology integrated into 0x protocol allows DEX to execute transactions faster at cheaper rates compared to ‘exchanges’ that carry out their trades ‘on-chain.’
0X Supports other applications: 0X protocol, in addition to DEX, supports other applications like (OTC) trading desks, portfolio management platforms, and digital marketplaces. For (decentralized finance) Defi products, 0x provides exchange functionality to them.
Supports non-fungible tokens: 0x allows for easy transfer of various assets than most Ethereum-based DEX. It supports fungible tokens (ERC-20) and NFTs (ERC-721).
What is 0x (ZRX) Token?
This is an aspect of 0X recorded success launched on the 15th of August, 2017. 0X tokens are unique Ethereum tokens represented as ZRX. Members use it as a value for exchange and also pay ‘relayers’ trading fees with it.
Relayers are people who decide to create their DEX using the 0X protocol. They are bound to pay some transaction charge to the system.
It serves as a “decentralized” means of governance in the ‘0x’ protocol’s upgrade. Users who own ZRX have the right to input their ideas into the system. This right to contribute (vote) is equated propositionally to the volume of ZKX owned.
ZRX supply has a fixed volume of 1billion distribution. Fifty percent of this volume was sold out during the token launching(ICO) at the rate of USD 0.048. 15% of it is for funding developers, 10% goes to the founders, and another 10% for the early backers and advisors. The remaining 15% is retained in the 0X system for its maintenance as well as the development of external projects.
The tokens shared out to advisors, founders, and staff members are on hold to be released after four years. Those who bought ZRX during the token launch were allowed to liquidate immediately. And the team raised a total of USD24 million during the launching (initial coin offering).
0x (ZRX) Token in Circulation
According to statistics, the volume of 0x (ZRX) currently in circulation is 841,921,228, with a max supply of 1billion ZRX. During the initial coin offering (ICO) in 2017, 50 percent (500million ZRX) of the maximum supply was sold out.
However, the 0X team placed “a hard cap” on the level of tokens each member can buy. This is to ensure an increase in ZRX token distribution.
The hard cap is the maximum value (of money) crypto can get in its (ICO) initial coin offering.
What Adds Value to 0x?
Relayers usually get rewards through trading fees as they host order books. ZRX is that utility token used for such rewards. 0x has made up to $5.7 billion in its trading volume.
A closer look at its trend shows great growth in the protocol’s ecosystem both in 2020 as well as in January 2021. Using ZRX as a payment token for trading fees is meant to lure users to hold the token. The increase in the holders of the ZRX token implies an increase in value as well.
Similarly, the use of ZRX as a governance token gives it value. Its holding propels effective governance on the protocol’s pipeline. You will have the opportunity to decide on protocol developments and upgrades as a ZRX holder.
It works on the principle of the more tokens one holds, the greater his influential power. This privilege increases the demand and value of ZRX. Also, scarcity has a potential influence on both the market cap and ZRX pricing. This’s because there’s a capped supply of ZRX.
How to Use 0x
As a user of ZRX, you have two ways to use your ZRX tokens:
- Trading with interested persons – In this method of usage, you will first get someone who wants to trade. Then you can send a 0x order through an email or instant message to the person. Once the party agrees to the trade, there will be an automatic execution of the trade.
- Browsing for orders in the crypto market – Where you are unable to personally source for an interested person to trade with, you can browse the crypto market. When you come across an order posted in the market that matches your trading choice, you can click your confirmation. This will automatically prompt the 0x protocol to execute the trade.
Also, by integrating 0x API with the Defi application and wallets, you can get exchange functionality plus top market prices. You can always have better market choices due to several projects that use the 0x API. Some of the projects include Zapper, MetaMask, Matcha, etc.
The 0x API enables several protocols and decentralized exchange protocols to provide liquidity to the 0x ecosystem. Some of the exchange protocols are automated market makers (AMM), such as Curve, Uniswap, Crypto.com, and Balancer.
Another critical use of 0x is to obtain direct access to its existing liquidity. This is by building projects on the 0x protocol.
Most teams are keying into this great opportunity like wallets (MetaMask), exchanges (1inch), and platforms on portfolio management (DeFi Saver). Others include derivatives products (Opyn), investment strategy products (Rari Capital), and NFT-based projects (Gods Unchained).
How to Buy ZRX?
You can purchase your ZRX on the Coinbase platform. Coinbase first made a listing of ZRX on Coinbase Pro where other professional investors could access the token. However, the token is now available on Coinbase’s primary website for retail investors.
You can also buy ZRX on Kriptomat. All you need to do is create an account on the platform. Complete the verification processes which differ from one platform to the other.
On Kriptomat, you will have to submit an ID or even a passport. Don’t worry about it, as the goal is to keep your investments secure. After you’ve verified your account, go ahead to buy your token.
What is the best Wallet to Store 0x?
Choosing a wallet for your crypto investment is a critical step for every investor. The truth is that you can lose all your money to hackers in one fatal strike. So, in this 0x review, we’ll explore the options you have to store your 0x ZRX
As an ERC-20 token, you can store ZRX in any Ethereum compatible wallet. The wallet can either be a software wallet or a hardware wallet. But your decision will depend on your purpose and the weight of your investment.
Types of Wallets Available
The software wallet is a better option if you’re into trading and not keeping the tokens for longer periods. The good thing is that you can get them free without any investment. Sometimes, they may come as a custodial wallet where the provider stores your private keys.
But if the wallet is a non-custodial type, you’ll store the private key in your device. Even though the software wallet is convenient and easily accessible, they’re not the best regarding security.
When it comes to security and privacy, the hardware wallets are at the top. For hardware wallets, you make use of a secure physical device for storing your private keys.
Usually, the hardware wallet is offline and offers more security against different forms of theft and hacks. The only downside is the cost of acquiring them or losing them.
There is also an online wallet that you can access through your web browser. These types are free and easily accessible from any device you want. The crypto community calls them Hot wallets, and they’re not safe. That’s why you must use a reliable platform that at least offers some security measures against hacks.
Another option is Kriptomat. It allows users to trade and store ZRX coins easily. This platform offers industry-grade security to protect your investment. Also, you can enjoy the interface no matter the level of your tech knowledge or lack of it.
Conclusion of 0x Review
It is no longer a hidden fact that most decentralized exchanges are fraught with many challenges. We’ve seen in this 0x review that the protocol aims at eliminating these issues, and that’s why it is growing. The protocol is easily accessible and versatile and facilitates the exchange of Ethereum tokens.
0x allows developers to build DEX, where users can swap tokens at competitive prices by supporting peer-to-peer assets exchange. Also, 0x integration of off-chain relayers helped lower the congestion level that users experience on Ethereum.
Also, 0x allows users to participate in its governance through their ZRX tokens. By holding the token, relayers can earn rewards and also accrue governance rights.
There is also the opportunity to stake the token for more rewards. People can stake ZRX tokens on 0x and earn rewards too. You can also sell ZRX tokens on your broker’s exchange.