Zhao Changpeng: Now might be a good time to launch a dark pool perpetual DEX
ChainCatcher news, Binance founder Zhao Changpeng posted on X stating, "Given the recent events, I think now might be a good time to launch a dark pool perpetual decentralized trading platform (DEX). I have always been puzzled by the fact that everyone can see your orders in real-time on a DEX. This issue is even more severe on perpetual decentralized trading platforms where liquidation exists. Even in the order books of centralized exchanges (CEX), orders are not associated with specific individuals, but if you want to buy a certain cryptocurrency worth $1 billion, you typically wouldn't want others to notice your order before it is completed. Otherwise, others might jump in and buy ahead of you, effectively front-running your trade. In a DEX, this could lead to MEV attacks. This would result in increased slippage, worse prices, and higher costs for you. Therefore, large traders in TradFi use dark pools, which are usually 10 times larger than 'lit pools' (i.e., regular order books).""For perpetual contracts (or futures), it is even more important not to let others know/see your orders. If others can see your liquidation point, they might try to push the market to liquidate you. Even if you have $1 billion, others might band together against you. This might be what we have seen recently." "The opposing viewpoint I see is that increasing transparency can allow market makers to absorb your large orders. This might be true. I don't want to argue which statement is right or wrong. Different traders might prefer different types of markets. Now might be a good time to launch an on-chain dark pool-style DEX + perpetual contracts, either not displaying the order book or, better yet, not displaying the deposits of the smart contracts at all, or showing them much later. This should be achievable through zero-knowledge proofs or similar cryptographic technologies."