This help article will cover information regarding trading on a Decentralized Exchange through Shrimpy. The short answer - we aren't using any one Decentralized Exchange, but a Decentralized Exchange Aggregator.
What is a Decentralized Exchange?
"A decentralized exchange is a trading platform that facilitates crypto trading in a decentralized fashion by utilizing smart contracts. By definition, any transaction that occurs in a peer-to-peer fashion can be thought of as being a decentralized trade.
If two crypto holders called Bob and Alice were to trade Ethereum for Tether with each other (and the entire transaction takes place on a blockchain), the trade is decentralized. If the trade were to be executed by an intermediary system, like an exchange or a custodian, the trade would be centralized.
As long as peer-to-peer trades stay, at all times, exclusively on the blockchain and interact in no way with a centralized platform, the swap in question is of a decentralized nature.
DEXs practice the same process, with the core difference being that they mimic centralized trading platforms. Their goal is to provide a blockchain-powered platform that offers trading services and liquidity to crypto investors, just like Binance or Coinbase does.
Decentralized exchanges achieve that feat by using smart contracts - a bundle of code that is automatically and autonomously executed once certain conditions are met. Such a structure allows DEX operators to automate withdrawals, deposits, and trades without having to authorize or initiate any actions."
-Excerpt from Shrimpy Academy - What is a Decentralized Exchange
What is a Decentralized Exchange Aggregator?
DEX aggregators are financial protocols that enable crypto traders to access a wide range of trading pools via one single dashboard.
For example, if you want to buy ETH using BUSD on the Ethereum blockchain, you could use the Ethereum-based DEX aggregator, Matcha, to tap into liquidity on decentralized exchanges, such as 0x, Uniswap, and Kyber, to execute your trade.
-Excerpt from The Role of DEX Aggregators in DeFi (trustwallet.com)
What we use
As opposed to using a single decentralized exchange and limiting our customers in both asset availability and liquidity, we instead opted to use a Decentralized Exchange Aggregator to provide our Dex trading feature. Specifcally, we have chosen to utilize 0x as our first supported Decentralized Exchange Aggregator. That said, it is expected that we will expand our service to utilize additional Decentralized Exchange Aggregators in the future.
Have questions, comments or concerns? Feel free to reach out to us via the blue "Support" button found in the bottom left corner of your Dashboard, or send an email to Support@Shrimpy.io.