The OAX platform will take advantage of technical developments on the Ethereum blockchain such as payment channels (Raiden, 0x, Swap, ERC20) and utilize them to overcome the challenges faced by the current CEM. It will co-opt the strengths of the existing model to improve the existent decentralized exchange attempts by linking existing exchange platforms (“Asset Gateways”) to the network and enforcing a collateralized deposit system that will provide users with a way to measure risk. It will also provide an off-chain, legally enforceable dispute resolution system to provide much needed consumer protection.
With improvements in the Ethereum blockchain ecosystem brought about by state/payment channel developments and decentralized governance methodologies such as boardroom.to, significant functional improvements can be considered to the entire Centralized Exchange Model (“CEM”). Key to this concept is the deployment of a new decentralized exchange platform that allows transparency for end users, holds collateral for participating gateways and provides a predetermined channel for dispute resolution. Current centralized exchanges are opaque, closed systems with limited visibility of security and access protocols, while the first generation of decentralized exchanges fail to adequately provide liquidity and trade volume for users. This white paper provides the pathway to a new, significantly improved platform governed by a decentralized autonomous organization (“DAO”), which in turn shall be developed by the Open ANX Foundation (the “Foundation”), a non-profit foundation. Furthermore, we shall explore the importance of governance and transparency required of any exchange system in order for it to be effective. The paper will provide an outline of the openANX project (“openANX” or the “Project”), milestones in the development, and delve into the requirements needed to ensure that the project avoids the pitfalls of previous decentralized exchange developments.