Since gaining prominence in recent times, Decentralized Finance (DeFi) has been marauded with some sort of technical problem especially as it utilizes Ethereum blockchain that only does about 25-40 transactions per second. Most, if not all current DeFi aggregators and DEX platforms are built atop the Ethereum blockchain, it’s easier to deploy contracts on the Ethereum blockchain than in any known blockchain and it’s quite cheap to do too.
However this comes with a cost, the cost is in the amount of gas fee spent just by interacting with this platform, a cost too much to bear by most traders who cite that the cost of the gas Fee itself is more than their targeted profit amount after checks. Not everyone has a $20 gas fee to pay for a $10 transaction, it’s absolutely ridiculous and makes little sense. Lower gas fees would delay your transactions stretching into days or weeks for successful completion, a frustrating loop suffered by DEX traders.
By eliminating the time spent for a successful transaction on the blockchain, reduced gas Fee to very significant low levels, allowing interoperability of different blockchain protocols, Polkastarter solves a lingering problem which has been associated with Ethereum blockchain right from the days of crypto kitties, crypto punks, blockchain gaming platforms that started the gas war of 2018 which shot up gas fees to a record high of nearly $50.
Recently gas hikes have been prevailing in the Ethereum blockchain yet again, it has proved to be unworkable, and doesn’t encourage low-income earners, guys at the bottom end of the spectrum to participate in DEX activities. New users who want to test the waters with low amounts aren’t encouraged by the high fee. So far there haven’t been working solutions that deal with this problem for DEX users.
Polkastarter will be the first of many improved Dex protocols, built on Polkadot, using the sharding technology to ramp up transactions occurring within the network. The significance of this improvement will affect the average DEX users in the following ways:
Cheap fees: Polkastarter protocol will enable cheap transaction fees, the processing speed in Polkadot blockchain is around 160,000 TPS, with this speed of transaction, costs will be greatly minimized, the high cost in Ethereum blockchain is because of the slow TPS which Miners take advantage of from time to time. Miners within the Ethereum network, in the times where the network is experiencing clog, will only pick and execute transactions with high fees allowing transactions with low fees to hang on for a long duration of time. This is big business for Miners and they get to decide how fast or slow each transaction would execute.
The problem of hiked fees is already at the top priority for Polkastarter regardless of the number of users available on the network per time.
Speed: No one has the whole day for a transaction no matter how important the needs are. In fact, a high confirmation speed of transaction is very sacrosanct for traders, little difference in time matters, with a short space of times, in minutes or seconds, the price can either rise or fall sharply. A protocol that delays payment because of low gas fees is very much frowned at to give way for a faster one. Processing 160,000 transactions per second is very much significant for traders, everyone loves speed.
Sharded network: Swift and cheap blockchain transactions are made possible by the sharded network of the Polkadot protocol on which Polkastarter built its DEX. Shard translates to a more scalable network, as more and more networks join the database, they will come to rely on each other while maintaining the privacy and security features that make blockchain technology so hot. Polkastarter will be one of many protocols built on the Polkadot network but for decentralized exchange purposes.
Sharding helps spread out the computational and storage workload across a peer to peer network so that each participating node isn’t responsible for processing the entire network transactional load but are evenly distributed throughout the ledger.
Interoperability: Sharding abilities will allow networks to inter-operate with each other so that data and file transfer happens smoothly across blockchains without hiccups. Projects listed in the Polkastarter DEX aggregator will be able to communicate with each other regardless of the blockchain type, taking off the limitation faced by legacy blockchains, where only tokens with the same blockchain type can interact.
Polkastarter protocol would change the game for decentralized exchange aggregators for good, ushering that much-needed ease for doing business within DEX.
Disclaimer: The information presented here does not constitute investment advice or an offer to invest. The statements, views, and opinions expressed in this article are solely those of the author/company and do not represent those of Bitcoinist. We strongly advise our readers to DYOR before investing in any cryptocurrency, blockchain project, or ICO, particularly those that guarantee profits. Furthermore, Bitcoinist does not guarantee or imply that the cryptocurrencies or projects published are legal in any specific reader’s location. It is the reader’s responsibility to know the laws regarding cryptocurrencies and ICOs in his or her country.
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