About 0x (ZRX)
0x is an open protocol for the peer-to-peer exchange of tokens on Ethereum. It is powered by the 0x token (ZRX).
0x was first described in a white paper published in February, 2017. The 0x protocol aims to create an open standard for decentralized applications (dApps) that wish to build decentralized exchange (DEX) functionality.
The 0x protocol reimagines the concept of a “decentralized exchange” by providing a mechanism that allows an order book and order placement to be made off-chain while keeping trade settlement on-chain. This increases efficiency by eliminating the cost to post, modify, or cancel an order and reduces the burden on the Ethereum network by limiting on-chain transactions to trade settlement, the moment when value is actually transferred.
Off-Chain Order Relay
An off-chain order book is made possible by “Relayers,” services that relay messages (known as broadcast orders) between participants off-chain. A participant (Maker) can submit a cryptographically signed order to a Relayer. If the order is valid, the Relayer will post it to the order book in return for a transaction fee, which is only paid if the order is filled. Once the order book is updated, any participant (Taker) can choose to fill the Maker’s order. Below is a visual depiction of how off-chain order relay works.
(Image source: 0x white paper)
A Taker can fill a Maker’s order by sending a cryptographically signed message to a DEX smart contract. If valid, the DEX will execute the trade between the Taker and Maker on-chain, transferring tokens between the participants.
Relayers do not play a role in trade execution, they simply facilitate communication between Makers and Takers. Because Takers must send a cryptographically signed message to a DEX in order for the DEX to execute a trade, they have final say over trade execution and do not need to trust Relayers, resulting in trustless trading.
ZRX is the digital asset token used to pay Relayer fees and participate in the governance of the 0x protocol. It is built on Ethereum in accordance with the ERC20 standard for tokens. ZRX can be bought and sold for fiat currency or other digital currencies.
ZRX can be stored in a crypto wallet and custodian like Gemini.
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The pricing data and asset description above are for general informational purposes only and are not investment advice. Buying, selling, and trading cryptocurrency involves risks. You should consult with your own appropriately qualified and licensed advisors before engaging in any transaction on Gemini. Some data is provided by Messari, a third party that is not affiliated with Gemini.