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Orbs Unveil New TWAP Protocol for Decentralized Exchanges

The Decentralized Time-Weighted Average Price (TWAP) order protocol from Orbs aims to overcome DeFis liquidity and volatility problems while unlocking opportunities for traders and platforms.

Orbs, the decentralized layer-3 blockchain infrastructure, has introduced a fresh decentralized Time-Weighted Average Price (TWAP) protocol to aid new order types for decentralized exchanges (DEXs) and Automated Market Makers (AMMs).

TWAP is generally deployed by algorithmic trading strategies over the centralized finance (CeFi) landscape.

Traders depend on the Time-Weighted Average Price (TWAP) solution to minimize a big orders effect on the marketplace by dividing the order into multiple smaller trades, wherein each trade is executed at regularly defined intervals over confirmed period.

Even though decentralized finance (DeFi) ecosystem is continuing to grow right into a multi-billion-dollar industry, the prevailing infrastructure, primarily the limitations of EVM smart contracts, helps it be very difficult to implement TWAP in a decentralized format.

In addition, the existing DeFi ecosystem has few features made to manage increased volatility and liquidity conditions that regularly unfold in the decentralized crypto economy.

Using its decentralized TWAP protocol powered by its layer3 technology, Orbs overcomes these shortcomings while benefitting traders and trading platforms simultaneously by significantly reducing material price impacts that arise from large orders.

Orbs decentralized backend means that all TWAP orders are executed at an optimal price and fair fees without sacrificing decentralization and security.

Accordingly, participating DEXs and AMMs grant their users more methods to take part in sophisticated trading activities, especially algorithmic strategies like those commonplace in CeFi, while also experiencing increased liquidity and user activity.

The protocol also enables users to leverage automated dollar-cost averaging (DCA) an investing strategy whereby an investor purchases a secured asset or group of assets at a precise fiat value in accordance with a predetermined schedule.

Orbs TWAP protocol may be used to generate an automated version of the DCA strategy, empowering traders to enter market orders with longer intervals and extended durations. Effectively, the TWAP protocol can serve being an automated DCA trading bot that will require no additional input from the trader.

In technical terms, Orbs layer-3 infrastructure extends the capabilities of existing EVM smart contracts. By leveraging the networks validators as off-chain bidders, Orbs TWAP protocol allows DEXs and AMMs to unlock new opportunities in a completely decentralized and secure setting.

Orbs TWAP smart contracts contain two components: market maker and market taker. As the maker (user or order creator) controls all parameters linked to the order, such as for example limit price, size, expiration, and the time, takers are incentivized participants who monitor orders and so are selected for trade execution after submitting bids, like the taker fee.

The best bid and lowest fees are selected for execution automatically.

As well as the TWAP protocol, the Orbs team is rolling out a new interface (UI) that DEXs and AMMs can simply integrate making use of their existing infrastructure.

The brand new UI is intuitive and user-friendly, allowing users to customize the parameters and initiate TWAP trades.

We have been always considering CeFi as a template for new protocols that may enhance our stakeholders experience, and TWAP (Time-Weighted Average Price) was no exception. As yet, it’s been difficult to implement a TWAP strategy in blockchain-based financial primitives in a decentralized manner using EVM-based smart contracts. With this new TWAP Protocol, everyone benefits be they traders or trading platforms. Besides managing liquidity better, support for more sophisticated trading strategies, automated DCA orders, customizable parameters, plus much more may also help us attract institutional participation in-kind.

Nadav Shemesh, CEO of Orbs

About Orbs

Orbs is really a public and decentralized blockchain infrastructure operated with a secure network of permissionless validators and the Proof-of-Stake (PoS) consensus mechanism.

The platform serves as a decentralized execution layer between existing layer-1 and layer-2 chains and the application form layer.

By enhancing the capabilities of EVM smart contracts, Orbs powers new use cases for DeFi, NFTs, GameFi, along with other emerging blockchain-based sectors.

Disclaimer

All the details contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the info entirely on our website is strictly at their very own risk.

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