In this DMDv4 era, one of our core roadmaps is to have an on-chain decentralized exchange in our ecosystem. We are glad to announce a major progress: we have completed the deployment of the Wrapped DMD (wDMD) ERC-20 contract, easing the journey to our first unique, native, Uniswap-style decentralized exchange (DEX).
You may wonder what DEX is, and why it is important to the DMD Diamond blockchain.
A DEX (decentralized exchange) is basically a peer-to-peer crypto marketplace without a central authority or middleman. In contrast to CEXs (centralized exchanges), where authority secures and manages your crypto or funds, a decentralized exchange (DEX) uses smart contracts and Automated Market Makers (AMMs) to autonomously execute your trading.
On-chain DEX means the following on the DMD Diamond blockchain:
- Sovereignty: With our on-chain DEX, you can maintain full custody of your assets anytime.
- Permissionless Accessibility: Anywhere; you can trade, as well as provide liquidity.
- Absolute Transparency: Our HBBFT instant finality use-case ensures every swap and liquidity pool is recorded on the DMDv4 ledger.
Why Wrapped DMD?
Indeed, the native DMD Diamond coins power the layer-1 DMDv4 governance and security. However, it must be wrapped for it to interact with the DeFi (decentralized finance) smart contracts commonly used in the EVM ecosystem. Basically, wDMD serves as a bridge between our native DMD Diamond coin and the DeFi world in the following ways:
- Standardization: As we are an ERC-20 contract-compatible coin, wDMD can easily integrate into any Defi tool or decentralized application (dApp) built on top of our chain.
- Cross-chain Ability: wDMD is aimed at DMD Diamond’s interoperability. This allows our native DMD Diamond coin to be movable across other chains.
- Liquidity Base Layer: wDMD also serves as a primary base layer for trading pairs on our DEX.
Conclusion
To the DMD Diamond community and beyond, the integration of a decentralized exchange on the DMD Diamond blockchain is not limited to a technical upgrade. It also affords the following benefits:
- Ecosystem Upliftment: A native DEX on our chain helps to attract new developers and projects. With it, we are providing a conducive environment for new tokens to get launched and traded. Hence, we are more positioned in the continuously growing DeFi ecosystem.
- Yield Potentials: The DMD Diamond community members can now become Liquidity Providers. This ensures you can earn a share of trading fees by pairing wDMD with stablecoins or other tokens.
- Front-Running Protection: With the threshold encryption use-case by our DMDv4, our DEX will be natively resistant to Miner Extractable Value (MEV) attacks.
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