New version — Flash Trade on swaps.io (demo)
As the launch of Flash Trade is getting closer and closer, it is an excellent opportunity to talk more about technologies the Kinetex team employed in this innovative mode of the Kinetex dApp.
The dev team specifically designed Flash Trade for high-liquidity assets. By leveraging native liquidity, this mode guarantees fast execution times and fixed rates and eliminates the need for bridges and DEXes in the swap routes. All orders in this mode are executed by resolvers who provide their own liquidity and compete with other resolvers for orders. As a result, users receive the best rates while avoiding risks connected to wrapped tokens, bridges, and MEV.
To ensure maximum security, Flash Trade uses Zero-knowledge technology, eliminating the need to rely on third-party validators vulnerable to attacks or other forms of compromise. With Flash Trade, users can enjoy an instant and extra secure swapping experience of their crypto assets.
The Flash Trade protocol relies on four participants or roles: Resolver, Worker, Liquidator, and User.
Resolvers play a crucial role in the protocol by setting rates, holding liquidity for order execution, and providing collateral to ensure timely order execution. These resolvers are expected to be professional market players who must analyze the market, construct their trading strategies, manage their own collateral, rebalance liquidity, prevent attacks, and have a risk management plan. This role is challenging and requires a sufficient level of experience in crypto.
The second role is played by workers who maintain Flash Trade's functioning. They are responsible for updating the state of Zk-LightClients (contracts that store blockchain data) and managing rates and orders. The workers first update the states of Zk-LightClients, and then the resolvers validate and confirm transactions by checking the blockchain's current state stored in these contracts. When managing rates and orders, workers utilize the rates received from resolvers and user quote requests to provide the best-fitting orders for the latter.
The third role is that of liquidators, whose primary responsibility is to ensure the fairness and safety of the system for all users. If a resolver fails to execute an order on time after taking user funds, liquidators step in to complete the unfinished order. They can transfer the desired assets to the user, provide proof of the transaction, and receive the resolver's collateral as a reward.
The last role is users who initiate cross-chain swaps. Since workers manage their quote requests and resolvers compete to complete orders, users can expect to receive the best rates using Flash Trade.
Stay tuned for Flash Trade updates!
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