What is a decentralized exchange (DEX)?
A decentralized exchange (DEX) is a marketplace for trading Ethereum-based tokens where a certain element of the exchange's functionality operates according to Ethereum's decentralized protocol. A common feature found in DEXs is that they do not rely on a third-party service to hold the user's assets. Another decentralized feature would be that trades occur directly between users through smart contracts.
We list DEXs that operate under varying “degrees of decentralization” running on the Ethereum main network. One has to understand how a particular exchange is implemented to appreciate just how decentralized it actually is. Broadly, DEXs may be categorized according to the following types:
- Off-chain order book, on-chain settled
- On-chain peer-to-peer
- Off-chain peer-to-peer
- On-chain order book & settlement
- Plasma-chain order book
To learn more about DEXs, please visit the following references:
What is DEXWatch?
DEXWatch is a decentralized exchange explorer built by a team of technologists at Codefi Data, an organization whose mission is to bring transparency to the Ethereum blockchain. We capture on-chain data pertaining to decentralized exchanges in real time and present information on trades, tokens, and accounts. We do our best to steward the data of these compelling—if at times technical—activities so they become useful, clear, and accessible information geared towards Ethereum experts and beginners alike.
Which DEXs are listed on the DEXWatch?
How can I list a DEX on DEXWatch?
Please fill out a form, and we will get in touch.
What is a trade?
A trade is a transaction in which two Ethereum addresses exchange two tokens at a certain ratio. A trade occurs when an order placed by Trader A, known as the seller (or maker), is filled by Trader B, known as the buyer (or taker).
For example, Jane wants to use a new blockchain dating app called iHeartU, which requires its users to pay for the service with HEART tokens. Jane places a sell order on a decentralized exchange using her Ethereum account address 0x01. She proposes a trade of 1 ETH — the native currency of the Ethereum blockchain — for 2 HEART tokens. We refer to 0x01 as the seller of this order.
Another user of the decentralized exchange, who is anonymous, sees 0x01's sell order. This user is interested in trading and happens to own HEART tokens. He fills the order using his own account, address 0x02. We refer to this address as the buyer.
Based on the trade, 0x02 sends 2 HEART to 0x01, and 0x01 sends 1 ETH to 0x02. The ratio of the exchanged assets is 1/2, signifying a price where 1 HEART costs 0.5 ETH.
What does maker and taker stand for?
Maker: The maker is the person first placing the order. In case of a sell order the maker could also be referred as “The Seller”.
Taker: The taker is the person filling the order of a maker. In case of a sell order the taker could also be referred as “The Buyer”.
What is a token?
Tokens are virtual assets on Ethereum that serve analogous functions to cash or existing bearer instruments — e.g. tickets, coupons, stock and bond certificates, vouchers, food stamps, and deeds — that entitle holders to different things, similar to how we use cash.
Organizations operating on Ethereum may issue tokens in order to grant holders access to their goods and services, entitle them to company dividends, and to participate in governance of their business model.
DEXWatch exclusively lists ERC20 tokens on the Ethereum main network. ERC20 is an open source software standard set by the Ethereum community. ERC20 defines a best practices API for transferring tokens and keeping a consistent record of those transfers in the Ethereum Network, which allows tokens to be exchanged via decentralized exchanges. All ERC20 tokens are issued by a smart contract, the colloquial term for an Ethereum software application, which is also responsible for generating and managing the token's supply. A token’s specific design and purpose may be further encoded into this smart contract or a set of related smart contracts.
What is Ether (ETH), wrapped Ether (W-ETH), and why do I need them?
Ether, or ETH, is the native cryptocurrency of the Ethereum blockchain.
The Ethereum Foundation defines Ether as "a necessary element — a fuel — for operating the distributed application platform Ethereum. It is a form of payment made by the clients of the platform to the machines executing the requested operations. To put it another way, ether is the incentive ensuring that developers write quality applications (wasteful code costs more), and that the network remains healthy (people are compensated for their contributed resources)."
Ether has existed since the inception of the Ethereum blockchain and predates the ERC20 token standard. To facilitate trading of Ether for ERC20 tokens, Ether must comply with the rules and standards governing the issuance, transferrence, and recordkeeping of ERC20 tokens. Through a process called "wrapping," Ether may be deposited to a smart contract that issues an equal denomination of an ERC20-compliant token called "wrapped Ether," or W-ETH. The wrapped Ether may then traded for other ERC20 tokens on decentralized exchanges or transferred between accounts like other ERC20 tokens.
At any time, W-ETH can be converted back to Ether through a reverse process of "unwrapping": the W-ETH is redeposited back to a smart contract, which then reissues an equal denomination of Ether.
What is a token pair?
A token pair describes the assets exchanged in a trade between two Ethereum addresses. When a maker sells an amount of token_A, it will be exchanged with another token_B for a certain amount with the taker (the buyer). In this case, token_A/token_B is a referred as the token pair.
What is a token price?
The price is the ratio of tokens exchanged in a given trade. If 1 ETH is sold for 2 HEART, the ratio of the exchanged assets is 1/2, signifying a price where 1 HEART costs 0.5 ETH. That means the buyer had to pay 0.5 ETH for 1 HEART and accordingly the price of HEART, based on that one trade, is 0.5 ETH.
DEX Watch API
We capture all on-chain data related to decentralized exchange activities in real time. All data is collected directly from the Ethereum blockchain. Please submit a request to access to our APIs.