Orbits, New Generation of DEX to Be Launched

By Habib Rahman shaikh

Orbits is a ZK-SNARK based multi-chain order book DEX with SaaS system and liquidity aggregator.

Technical characteristics of Orbits

· zk-SNARK proof

· Orbits is the first zk-SNARK based DEX.

zk-SNARK (Zero-Knowledge Succinct Non-Interactive Argument of Knowledge), a concise and non-interactive zero-knowledge proof. This is the technology used by the well-known anonymous project Zcash, but in the application of the DEX field, Orbits should be the earliest.

Zero-knowledge proofs have a consensus on security protection, and the size of SNARK proofs is relatively small, so it is beneficial to reduce transaction costs.

L1+L2 Network Structure

Orbits include a two-layer network structure. Smart contracts are deployed on Ethereum L1, while L2 is a shard chain.

The Orbits network system consists of Collator, Validator, and smart contracts.

The collator is responsible for collecting transactions submitted by users to the shard chain, checking the validity of the transactions, and packaging valid transactions to the verifier.

The verifier is responsible for calculating the state change and calculating the ZK-SNARK proof, and submitting the zk-SNARK to the smart contract on the beacon chain for verification.

The smart contract is responsible for governing the L2 shard chain, accessing assets between the beacon chain and L2, and verifying the finality of the shard chain blocks.

Aggregator

Orbits has a liquidity aggregator. The official document states that it “shares the depth of liquidity with Binance”, which should aggregate Binance’s transactions.

Generally, this type of product prepares funds in several currencies in Binance according to the situation, and calls the Binance API to execute the transaction in Binance according to the user’s transaction situation. For example, if a user puts an order to sell ETH on the platform, the platform calls Binance’s API, and places an order to sell ETH at the same quantity and price in Binance, thereby realizing the sharing of trading depth with Binance. Of course, if a user on the platform buys ETH at the same or higher price, the transaction can be completed on the platform. Basically, it is implemented and aggregated like this.

There is no mention of trading pools such as Uniswap in the official documents. Technically, aggregators can aggregate the liquidity of DEXs such as Uniswap.

SaaS

In Orbits’ self-description, SaaS is mentioned.

SaaS, Software as a Service, is a new type of software service. Buyers no longer purchase software programs, but purchase a complete set of software services. They do not need to run software systems on their own servers, but the seller provides servers, software programs and supporting services.

Orbits’ blog mentions that “the settlement layer can deploy multiple sub-chains, and achieve unlimited expansion of transaction efficiency through modular and customizable sub-chains.” In combination, SaaS should be used to realize this type of modular sub-chain.

What Advantages Might Orbits Have ?

· Order Book

The current mainstream DEX product is a repository-style DEX. When trading, the real-time transaction price is calculated according to the AMM model. Traders cannot place pending orders.

An order book-style DEX that supports trading at market prices or pending orders at limit prices. According to the Orbits documentation;

• Orbits also support viewing positions and historical orders.
• Support multi-chain spot and derivative transactions
• Orbits supports token transactions on multiple blockchains.

As described in the Orbits document, it supports multi-chain transactions of more than 500 tokens and multi-chain perpetual contract transactions.

· Low Cost + High Performance

Since the settlement layer of Orbits is on L2, the transaction has the characteristics of low cost and high performance. The zk-SNARK technology is also conducive to reducing transaction costs. Orbits official information shows that “transaction costs are lower than 1/40 of the main chain”, “transactions are executed instantly, and the main chain is confirmed in seconds”.

· Safety

zk-SNARK technology is the core guarantee of Orbits security.

· Better Trading Depth

The aggregator allows Orbits to share the transaction pool with other platforms and DEXs, which can form a better transaction depth.

· Scalability

At present, SaaS has not been launched yet, and the official roadmap shows that this should take some time to land. And it takes time from landing to promotion. But SaaS should be able to be used to implement modular subchains, which can be independent DEXs or shared with Orbits. Therefore, the Orbit’s ecology has certain scalability.

What Disadvantages May Orbits Have ?

When the aggregator calls APIs of other platforms or liquidity pools, users may experience occasional freezes and delays when placing and canceling orders. Of course, when Orbits develops and grows, the user scale and transaction depth are large enough, the probability of calling the API will become very low, and the probability of this situation will be even lower.

In general, Orbits has built an aggregated DEX platform with CEX experience on the L1+L2 network structure, and has DEX decentralization, security advantages, and some transaction characteristics of CEX.

Author LinkedIn: https://www.linkedin.com/in/habibrahmanshaikh