Introduction

DMEX is the first decentralized exchange (DEX) for margin trading that provides the same experience as a centralized exchange in terms of execution speeds, liquidity and spreads. If you have ever used a centralized margin trading exchange like BitMEX, you will find little to no difference between using BitMEX and DMEX in terms of user experience (speed, liquidity, spreads) while DMEX provides a totally secure environment for your funds.

Speed

The main concern when using a DEX is the speed. Users that have interacted with a DEX before, will remark the uncomfortable experience of waiting for their trade to confirm on the blockchain or having the trade fail because someone else has traded the order and losing the gas fees.

DMEX solves this problem by employing a Hybrid DEX model, where the order book and matching engine is stored on a centralized server while the funds and transactions are recorded on the blockchain. This allows for instant order execution (no need to wait blockchain confirmations) and prevents front-running as all trades are pushed in FIFO (first-in-first-out) order to the blockchain by the matching engine.

Another advantage to using the hybrid approach is the free order cancelation. On a traditional DEX to cancel an order you would have to send a transaction and pay the gas fee.

The matching engine also tracks the order fills and will not match orders that are already filled and awaiting to be recorded. The user receives instant trade confirmation.

To feel the speed of DMEX we encourage you to try out a trade on the DEMO version of the exchange. The DEMO version runs on the Rinkeby Ethereum testnet and performs all the same operations as it would on the mainnet.

Liquidations

On traditional centralized margin trading exchanges the positions are liquidated using the internal exchange price which opens up the possibility for the exchange owners to manipulate the price in order to liquidate your position early.

On DMEX positions can only be liquidated by the price on the reference exchange (MARK PRICE). This eliminates the risk of price manipulation on the part of DMEX.

In order to liquidate a position, the MARK PRICE must first be recorded on the DMEX contract by a decentralized Oracle. DMEX or its owners cannot record the price of the asset. Only the Oracle can do that.