Jack Dorsey, the CEO of Twitter and Square, is not pleased enough only to be called a Bitcoin proponent. He is attempting to do everything that he is capable of to convert the vision of making Bitcoin a global payment method into reality. In the mid of July, Dorsey declared to launch TBD, a fresh business constructed to assist the development of services related to decentralized finance. Today, he concluded his statement by saying that a DEX (decentralized exchange) will be developed by the TBD.
No further information was provided by Jack Dorsey about the new platform. Thus it seems only to be at a theoretical level. Nonetheless, looking at the strength of CashApp, there is a possibility that the development procedure will not get complicated in the case of making a product out of scratch.
Decentralized exchange: an introduction
Decentralized exchanges or DEXs are platforms by which the users are permitted to trade tokens and crypto without requiring any intermediary linkage. Everything is carried out in a decentralized manner due to the encrypted code of a smart contract. Generally, there are a lot of advantages of these exchanges, such as they operate anonymously, can incorporate any token which is well-matched with the particular protocol without demanding any process of verification, do not demand KYC, and permit simultaneous business development through creating additional linkages with the previously used smart contracts.
Talking about the shortcomings, activities are slow, and every trade needs to be mined through a block. Moreover, their complexity is increasing day by day, making them more expensive. Additionally, there are more chances for the decentralized exchanges to get exploited by hacks because their code is public-natured. When such a situation befalls any of them, the victims cannot blame anyone for that calamity. Balancer, Bancor, Sushiswap, and Uniswap, etc., are the most prominent examples of such exchanges.
Jack Dorsey’s Bitcoin based-DEX is not as simple as it seems
Because of their complexity, decentralized exchanges are likely to be structured on the blockchains of the second generation. Bitcoin is developed on a first-generation blockchain as it just allows for the sending as well as the receiving of tokens, unlike Binance and Ethereum being second-generation. Nonetheless, Jack is a strong advocate of Bitcoin and, at the same time pursuing to make his DEX the topmost crypto exchange. So, to get at this goal, no specific details have been shared by him. However, Mike Brock (the TBD’s general manager) revealed that the code would be mostly developed on RSK (a layer-2 solution that allows the smart contracts’ execution on the BTC network.