What is dex Aggregator? Getting to know the decentralized exchange that collects liquidity

If you are active in the digital currency market, you are probably familiar with centralized and decentralized exchanges. dex Aggregator can be One of the newest types of decentralized finance (DeFi) is known to be used by many traders for better access to liquidity and pricing. In this article, we are going to answer questions like what is Dex Aggregator? how it works? to answer So stay with us.

Read more What is dex?

Take a look at Dex Aggregator

DEX stands for Decentralized Exchange created using Blockchain technology. For this reason, it is more secure than other exchanges. The current challenge of these exchanges, which has caused traders to use them less, is pricing and lack of liquidity for small tokens. To solve this challenge, the developers created dex (Liquidity Aggregator).

Simply put, Dex Aggregator is a financial protocol that allows traders to connect to various trading pools through a dashboard.

The use of digital currencies for financial transactions is increasing. Many investors are not interested in having their information disclosed by centralized exchanges. For this reason, the existence of such exchanges is necessary.

Investigating the evolution of the dex assembler

Dex Aggregator was first launched in 2019 by Sergey Kunz (SergejKunz), and Antoine Bokov (Anton Bukov) was built in less than 18 hours as part of a hackathon competition. The main reason for the design of Dex at that time was the need for participants to collect information from decentralized exchanges. The designed version was not practical enough; But it can be considered as a basis for creating today’s exchanges.

Currently, these exchanges have reached a relative evolution and many traders who have a large volume of digital assets use this method to conduct their exchanges.

Comparison of dex Aggregator and dex

Although both the dex service and the dex aggregator are designed based on the blockchain and act somewhat similar; But they are very different from each other. The following are the main differences between these two services:

1. Dex aggregators provide the possibility of liquidation to their users.

2. Aggregators provide users with the ability to provide liquidity from various decentralized exchanges with the best rates, while Dex does not have the ability to provide such a service.

Why use Dex Aggregator?

The main question we need to answer is why to use this service. The most important reason for using this service is the direct and indirect exchange of tokens, which reduces the possibility of information disclosure to zero.

One of the shortcomings of this service is the use of an automatic market maker (AMM) that manages price changes in DEX; But by providing a single point of access to DEXs, the developers have tried to help the user find better prices for the currencies they want and make an informed transaction. This is why traders choose this method.

Identifying and choosing a strong and efficient service for small investors is a very difficult task.

Now that you are familiar with why to use this dex aggregator, it is better to examine how they work.

Checking how Dex Aggregator works

Aggregators are built on decks; Similar to the process in which layer 2 is built on the blockchain. They provide a single point for traders to view all the different prices and markets on the blockchain, resulting in reduced transaction costs, token prices, and potential user error in transactions.

In fact, Dex works similar to Google. When you want to buy a product, you search its name in this search engine to show you a list of available options. Then you choose the best option among the suggested items and finalize your purchase. Dex works in the same way and shows you the best offers so that you can make your purchase as quickly as possible.

Types of dex Aggregator

In general, there are two types of dexAggregator, which we will examine below:

Business aggregator

The main job of a decentralized liquidity aggregator exchange is to aggregate transactions and provide different options to the user to choose the best and most profitable transaction.

Information aggregator

The task of this type of aggregator is to collect information as quickly as possible. They provide information to users to make sound trading decisions by analyzing the data.

Advantages of Dex Aggregator

Dex can be considered the newest service in decentralized finance that has quickly found its place among users. Many traders use these services. For this reason, in this section, we mention some of the advantages of aggregators.

Provide liquidity

The aggregator provides a large volume of liquidity to traders who intend to make high volume transactions. They aggregate all the offers available in different exchanges and show them to users at once.

Suppose you intend to convert Ethereum to USDT; But in a certain dex, you cannot do this because of the low volume of liquidity. Then to one dex Aggregator You go to easily make the exchange and exit the deal.

being anonymous

Aggregator is a feature added to Dex that allows the user to make transactions by providing minimal information. In this method, unlike traditional exchanges, the user’s information is not collected and stored, and they can easily make the transaction through their wallet without any intermediaries.

Identify the best price

Decentralized exchange aggregating liquidity offers traders a better price list compared to individual DEXs; Because it is designed to help traders to make the best buying and selling.

Decentralized

Dexes of any kind allow you to directly transfer the funds and coins you want from one wallet to another wallet without needing an intermediary.

Strong infrastructure

Aggregators are designed for transparency just like open source software where the user can monitor everything. They do not use a single source system, which increases security.

Review of the best decentralized liquidity aggregator exchange

Now that you are familiar with the benefits and how these exchanges work, we are going to introduce you to some of the best decentralized exchanges that aggregate liquidity.

• Keyber exchange
• Banker Exchange
• exchange IDEX
• Airswap exchange
• UniSwap exchange

If you intend to make a transaction without an intermediary in the blockchain network, you can use the services of the said exchanges.

The future of Dex Aggregator

Most likely, in the near future, this service will take over a large part of the market; Because many users want to do their transactions without intermediaries and no organization or group collects their information. Therefore, the future of this service is very bright and it can be considered as a suitable alternative for centralized exchanges.

What is dex Aggregator? Getting to know the decentralized exchange that collects liquidity for the first time on the Wallex blog. appeared.