Totle – An Aggregator Of Decentralized Exchanges
Cryptocurrencies are an outcome of decentralized blockchain technology. However, when it comes to trading cryptocurrencies, centralized exchange rules the market. While exchange such as Binance executes trades worth more than $1 billion per day, decentralized exchanges put together trades merely a little over $20 million in an entire month.
Some of the decentralized exchanges are struggling to do even a volume of half a million per day. This might soon change with the arrival of Totle, a platform that aggregates order flow from multiple decentralized exchanges.
The beta version of Totle has been released and can be used to execute trades. The platform aggregates price quotes from Bancor, Kyber, Forkdelta and other decentralized exchanges (DEX). So, rather than visiting multiple decentralized exchanges, a user can simply use Totle platform to complete the P2P exchange. Depending on the volume of order placed and liquidity available in various exchanges, Totle’s smart contract platform executes the trade in a single or multiple decentralized exchanges.
Totle’s CEO David Bleznak said
“We have a family of contracts that act as the on-chain component to our routing system. A user submits orders to our parent contract and then passes the order to the handler contract for the appropriate exchange venue. The handler, or child, contract then acts as a taker to decentralized exchange. All necessary transactions are bundled together and mined in one block and therefore atomic and trustless. Our users only end up with their orgiinal assets or their new desired allocations.”
Six smart contracts work in unison to make this possible. Regarding auditing of smart contracts Bleznak says
“We are working on private audit with many groups right now, there are no public audits to report right now.”
Bleznak further stated
“Yes, the contracts do not store funds… see Bancor hack – we are not susceptible to this type of situation because we do not store liquidity in contracts, we simply relay orders to the DEX venue for the best execution.”
When Bancor was hacked, traders did not lose any of their crypto holdings as it is a p2p trading platform, but Bancor lost its own funds. Therefore, smart contracts should be bug free. Any issues in the smart contract can put Totle and even traders in trouble. Therefore, a public auditing would increase trust on the exchange.
As mentioned earlier, Totle’s smart contracts have the ability to execute partial orders. However, the order routing algorithm is obviously kept as a secret. However, the execution happens on the blockchain.
Regarding future plans, Bleznak said “plan to allow developers to build on the endpoints of our open API.”
The process would be as follows
“A user submits a request to the service specifying which token they would like to buy or sell. It searches across a list of DEXs to find any order that has the potential to fill the request. Orders from the DB. Real-time price discovery. It traverses across the array of orders found filtering out only the best orders.”
Bleznak also revealed that the “orderbook search is done off-chain with this method off aggregation allowing for savings on trading of “about 10-20% on average.” As of now, a trader will not be able to place limit orders. Only market buy or sell order is possible.
Regarding limit orders Bleznak said “We are working on a separate interface for market makers to place limit orders.”
One of the interesting future planned by the Totle team is margin trading. This would be achieved through the use of a decentralized lending platform called Lendroids. Totle is also working with Bloqboard.
It is also rumored that Coinbase’s Toshi, a free Bitcoin API for developers, is planning to add Totle to their DApp browser. However, Bleznak refuses to divulge details about that project.
Presently, Totle does not charge any fees for using the platform, but might change in the future.
“Normal and familiar fees will be added for the convenience we provide, however because we can partially fill among multiple venues/protocols, we can provide better execution inclusive of our fee rather than the user going directly to one of the venues themselves due to slippage.”