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What is a cryptocurrency exchange?

What is the IDEX exchange?

What is IDEX and how does it benefit its users? Read this guide to find out!

Introduction

The IDEX exchange is an Ethereum-based decentralised exchange that uses smart contracts and allows users to trade ERC-20 tokens in real-time. The decentralised aspect of the exchange benefits user’s security over the tokens they are trading.  On IDEX you can deposit directly onto an exchange from your wallet while retaining custody of your deposit.

This is obtained by using Ethereum’s smart contract, which means you can manually deposit and withdraw even if the IDEX main site goes offline. The added sense of security, especially in light of exchanges pulling exit scams in 2018, is a great benefit to users of cryptocurrencies, who are typically more safety conscious than ‘no-coiners’.

The exchange was created by CEO Alex Wearn, who holds a dual MBA in finance operations from Northwestern’s Kellogg School of Management. Wearn leads a team of six employees, including David Fernalld who is the lead developer and his brother Phil Wearn who is the COO.

Signing up process

Since IDEX launched in early 2018 customers were not required to undergo any particular sign up process or KYC, all users needed to do was input their wallet info or connect their hardware wallet through a USB port. Doing this would allow users to trade ERC-2o tokens directly with their peers via order books on IDEX. However, in November 2018 the exchange made a bold step to avoid potential regulatory and AML issues by making KYC mandatory:

“Decentralisation exists on a spectrum, and unless your system or application lacks any centralised parts it can be subject to regulation. Aurora is working to create a fully-decentralised financial system, but the path to getting there requires significantly more control and centralisation than the end state. In addition to IP blocking, IDEX will be implementing KYC/AML policies in order to comply with sanctions and money laundering laws.”

Trading tools

IDEX exchange presents an easy-to-navigate platform with a wide range of ERC-20 tokens. Tokens are tradable at spot price against Ethereum, no margin trading or leveraged trading is available on the exchange.

Users can also earn monthly rebates by using IDEX’s native AURA token. Before trading, users can select whether they want to pay cheaper trading fees, or to stake AURA tokens, which are paid back at the end of each month.

Market fees

Market makers, who post limit orders on the order book, are charged a 0.1% market fee. Takers, who purchase pre-existing orders on the order book are charged 0.2% as well as the gas fees it takes to send the transaction through the Ethereum blockchain. It is free to post orders then cancel, as this does not go through the Ethereum blockchain, thus not spending any gas.

What next?

For more comprehensive guides to cryptocurrency exchanges, click here.

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