0x (Zero-X) Report

TOKEN TRADING SYMBOL - ZRX

COMPANY JURISDICTION – N/A

Rating +,✓,- Description

Team

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“Our team is a globally distributed group with backgrounds in engineering, research, business and design. We are passionate about decentralized technology and its potential to act as an equalizing force in the world.

Will Warren (CO-FOUNDER & CEO)

  • Smart contract R&D
  • Previously applied physics at Los Alamos Nat Lab.
  • Mechanical engineering at UC San Diego, PhD dropout

Amir Bandeali (CO-FOUNDER & CTO)

  • Smart contract R&D
  • Previously fixed income trader at DRW
  • Finance at University of Illinois, Urbana-Champaign

Roadmap

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0x v1 was launched August 2017 on Ethereum mainnet. 0x v2 is projected to be released late July 2018, which adds additional functionality    

Technology

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0x facilitates low friction peer-to-peer exchange of ERC20 tokens on the Ethereum blockchain. The protocol is intended to serve as an open standard and common building block, driving interoperability among decentralized applications (dApps) that incorporate exchange functionality. Trades are executed by a system of Ethereum smart contracts that are publicly accessible, free to use and that any dApp can hook into.

3 Actors in the 0x Protocol:

  1. Maker – creates an order to exchange Token A for Token B, specifying a desired exchange rate
  2. Relayer - host and maintain an off-chain order book in exchange for transaction fees
  3. Taker – Taker intercepts the order and decides that they would like to fill it.

1. Relayer cites a fee schedule and the address they use to collect transaction fees.

2. Maker creates an order, setting feeA and feeB to values that satisfy Relayer's fee schedule, setting feeRecipient to Relayer's desired receiving address and signs the order with their private key.

3. Maker transmits the signed order to Relayer.

4. Relayer receives the order, checks that the order is valid and that it provides the required fees. If

the order is invalid or does not meet Relayer's requirements, the order is rejected. If the order is

satisfactory, Relayer posts the order to their order book.

5. Takers receive an updated version of the order book that includes Maker's order.

6. Taker fills Maker's order by submitting it to the exchange contract on the Ethereum blockchain.

Execution

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0x v1 mainnet is launched and DEXs are currently using the protocol

0x v2 is projected for late July 2018:

  • more efficient order matching
  • support new token standards

Marketing

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Not a lot of marketing but the protocol is gaining adoption regardless, see Community portion

Coinbase announced it is exploring support for the ZRX token

Whitepaper

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Well written, semi-technical whitepaper outlining all functions on the 0x protocol. Good illustrations to give the reader an understanding of how the protocol works.

Community

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15 0x Relayers facilitating ERC-20 token trades

100K total trades

$183million in total volume traded

$4 million avg daily volume

Token Economics

ZRX tokens will have two uses:

  1. for market participants to pay transaction fees to Relayers
  2. Decentralized governance over updates to the protocol. Decentralized governance will be used to securely integrate updates into 0x protocol

Need (Purpose)

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“decentralized exchanges can provide stronger security guarantees to end users since

there is no longer a central party which can be hacked, run away with customer funds or be subjected to government regulations. Hacks of Mt. Gox, Shapeshift and Bitfinex have demonstrated that these types of systemic risks are palpable. Decentralized exchange will eliminate these risks by allowing users to transact trustlessly - without a middleman - and by placing the burden of security onto individual users rather than onto a single custodian.”

Ethics

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Team and project have good ethics, with the goal to bring a more secure and trustless means of exchange.

Final Rating: +

Comments:  The 0x protocol was launched in Q3 2017 and has seen good adoption as a means of peer-to-peer exchange for ERC-20 tokens. Currently Ethereum has one of the largest communities in the cryptocurrency space with many ERC-20 tokens which are constantly being traded, so there is a big use case for a decentralized means exchange. They are led by a team with both previous blockchain and trading experience. This mix of experience is important as it will help guide the project from both a technical and operational standpoint.

 

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