0x (ZRX) is an open-source protocol built on the Ethereum blockchain, designed to facilitate peer-to-peer (P2P) exchanges of Ethereum-based tokens. As a decentralized exchange (DEX), 0x enables seamless trading of tokenized assets—from traditional assets like stocks and real estate to digital collectibles like in-game items—while promoting interoperability among decentralized applications (dApps).
How 0x Works
Core Vision
Founded in 2016 by Will Warren and Amir Bandeali, 0x provides a standardized protocol for trading Ethereum tokens without intermediaries. Its smart contracts allow developers to build decentralized exchanges ("relayers") that host off-chain order books, reducing blockchain congestion and costs.
Key Features
- ZRX Token: The native token powers governance (holders vote on protocol upgrades) and pays fees to relayers.
- Off-Chain Order Books: Relayers aggregate orders off-chain for efficiency, settling trades on-chain only when matched.
- Interoperability: Integrates with dApps, enabling asset swaps across platforms.
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Tokenomics and Governance
ZRX Token Allocation
- Total Supply: Capped at 1 billion ZRX.
- ICO (2017): Raised $24M in ETH; 50% of supply sold to the public.
Use Cases:
- Fee Payment: Relayers earn ZRX for hosting order books.
- Governance: Token holders influence protocol upgrades.
Security Model
Built on Ethereum, 0x addresses scalability by processing orders off-chain. Transactions are finalized on-chain only after matching, reducing gas fees and latency.
FAQs
1. What is the purpose of the ZRX token?
ZRX facilitates governance (voting on upgrades) and pays relayers for maintaining off-chain order books.
2. How does 0x differ from centralized exchanges?
0x eliminates intermediaries—users trade directly via smart contracts, retaining custody of their assets.
3. Can developers build on 0x?
Yes! The protocol’s open-source code (written in Solidity) allows anyone to create relayers or integrate 0x into dApps.
Why 0x Matters
By combining off-chain efficiency with on-chain security, 0x solves liquidity and cost challenges faced by traditional DEXs. Its governance model empowers the community, ensuring decentralized evolution.
For traders and developers alike, 0x represents a cornerstone of Ethereum’s DeFi ecosystem.