New version — Flash Trade on swaps.io (demo)
The Kinetex team is excited to announce that Flash Trade is almost here. After successfully creating Aggregation Liquidity, the team worked hard to shift from a liquidity aggregation service to an innovative intent-based trading platform. In this journey, they achieved many significant milestones that became helpful steps in building Flash Trade.
The Kinetex team was always inspired by the idea of overcoming problems hindering the mass adoption of crypto. For instance, Kinetex's Liquidity Aggregation mode was created to address the liquidity issues that have tormented DeFi users. By collecting over 400 liquidity sources in one place, Kinetex provided adequate liquidity for thousands of tokens, making trading more straightforward and rewarding.
After finishing work on the Aggregation mode, the team analyzed other prevailing DeFi problems and realized that the industry needs a more comprehensive approach that will overcome many challenges simultaneously and not one by one. This is how the idea of Flash Trade first came into existence.
Flash Trade mode addresses many industry problems, including long execution times, MEV attacks, price slippages, and others, while streamlining and enhancing user experience. This became possible thanks to an intent-based approach that involves direct trades between users and professional resolvers. Such an approach allows seamless, one-transaction trading, both on-chain and cross-chain, even when Bitcoin is involved.
Intents offer a novel solution to the challenges associated with making transactions. They allow users to accomplish their desired outcomes without having to select specific methods to achieve them. Unlike traditional transaction-based processes, which limit the validator to following a single predefined route, intents permit any route that satisfies certain criteria. This approach offers two key benefits: it alleviates the burden of decision-making from users by delegating it to professionals, and it provides greater flexibility during swaps, which can be particularly advantageous in a volatile and ever-evolving crypto market.
Kinetex implemented an intent-based approach by leveraging ZK technology and creating ZK light clients, whose first developments were presented at the ETHGlobal hackathon last year. Light clients allow Kinetex to facilitate instantaneous swaps between users and resolvers without relying on third-party validators, using cross-chain bridges, or paying high gas fees.
One of the key features of Flash Trade is the support of Bitcoin. The creation of BTCX (Bitcoin ZK light client) with the help of Succinct Labs, announced at the end of February this year, enabled Kinetex to connect two worlds that for long seemed unconnectable due to the evident lack of native support for Bitcoin on many DEXes. While Ethereum-based tokens dominate the landscape of DEX trading pairs, facilitating seamless swaps through smart contracts, Bitcoin operates on a separate blockchain with different technical specifications. As a result, trading BTC on DEXes often requires wrapped versions of Bitcoin, introducing additional complexities and counterparty risks.
Kinetex changed that with the introduction of BTCX. It allows EVM-compatible networks to verify Bitcoin's state directly without the need for any centralized intermediaries. In other words, it enables Kinetex to add Bitcoin to the list of supported crypto assets that can be effortlessly swapped using Flash Trade.
Flash Trade's security is ensured through Hashi adapters and ZK light clients. First, Kinetex takes advantage of Hashi's redundancy approach. Hashi is a Hash Oracle Aggregator that ensures that cross-chain interactions are secure and dependable by gathering messages and block headers from different sources and rigorously validating them by multiple independent mechanisms. Kinetex seconds such an approach, approving thorough data validation.
The second component of Flash Trade's security is ZK light clients, which eliminate dependency on third-party validators, another major weakness of many decentralized solutions. By switching to ZK proofs, Kinetex eradicates any risks associated with malicious actors bribing validators or compromising them in other ways to manipulate their decisions. ZK light clients were built with Succinct Labs, particularly their plonky2x framework.
Apart from Bitcoin support, One of the most noteworthy advantages of Flash Trade is indeed execution speed. The average execution time in this mode is 1 to 10 seconds (1 confirmation block). As a result, users can enjoy an instant swapping experience.
The second advantage is MEV protection. MEV refers to the profit validators can accumulate by exploiting users' transactions. Since Kinetex does not need to rely on validators, no validator can exploit Kinetex's users' trades.
The third advantage is zero slippage. The intent-based approach means that Kinetex's users have a say in choosing the swap conditions. When they place their order, resolvers compete, offering rates. Then, Kinetex algorithms determine the most suitable offer, which the user may accept or deny. Such an approach ensures no price changes are possible during the swap, which makes the trading process much more predictable and non-stressful.
The last noteworthy advantage is the absence of liquidity pools, so there are no concerns about hackers stealing the funds stored there. Resolvers provide all liquidity while they complete user orders. They can collect necessary funds across various platforms, whether centralized or decentralized. This way, Kinetex can ensure adequate liquidity for practically any token.
Stay tuned for the launch announcement! Do not miss Flash Trade on the new domain: swaps.io
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