Independence From Custodial Trading And Sovereignty From Closed Platforms With Komodo

Komodo PlatformJuly 4, 2019

On February 21, 2016, Komodo’s Lead Developer James ‘jl777’ Lee published his blockchain declaration of independence:

We the asset holders hereby declare our independence from any single blockchain.

An open and jointly developed specification on cross chain atomic asset transfers will be developed. Any current or future blockchain is invited to join.

Now, on July 4, 2019, Komodo is excited to confirm that with launching two revolutionary products in July this vision is becoming a reality.

Komodo has just launched the beta release of AtomicDEX, a revolutionary mobile application that combines the functionality of a secure multi-coin wallet with the peer-to-peer trading features of a decentralized exchange. While Komodo has been the leader in atomic swaps for years, this new application is the most advanced generation of Komodo’s peer-to-peer swap technology.

AtomicDEX provides independence from custodial trading methods, allows users to exercise the right to always hold their private keys, and gives users the freedom to trade directly between any two listed assets.

In addition, Komodo will release the new Antara Framework on July 15, 2019. Antara is a flexible framework for end-to-end blockchain development. The Antara Framework lets every third-party project customize and launch a sovereign Smart Chain, which provides complete independence from the Komodo blockchain and platform.

Those that build with the Antara Framework also have a library of built-in modules to choose from, such as oracles, tokens, instant micropayments, and stablecoins, as well as the ability to create powerful, Turing complete apps that run directly on their own independent Smart Chain.

Independence From Custodial Exchanges

Most digital asset exchanges require users to give up their private keys prior to making trades. For this reason, centralized exchanges are sometimes called custodial exchanges, as they take custody of users’ funds.

Users must deposit their coins and tokens into an address controlled by the exchange and, after a confirmation waiting period, users are allowed to trade for other assets.

As a result, you don’t actually own your assets until you request a withdrawal, pay a fee, and wait for the exchange to dispense your funds. Once the funds arrive in the wallet you specified, the private keys are yours again.

This system is in place for obvious reasons— exchanges need to verify that a user has the funds they want to trade before they are allowed to trade them. However, this custodial system also creates enormous security issues for both users and the exchanges themselves.

Since centralized exchanges take control of all users’ funds, they hold a great deal of wealth in a few concentrated, high-value wallets. This makes them the perfect target for malicious hackers.

Hackers stole somewhere between $950 Million and a cool $1 Billion from centralized exchanges in 2018 alone. That figure doesn’t even take prior exchange hacks into consideration, which also amount to hundreds of millions of dollars in losses.

If an exchange gets hacked and is forced into bankruptcy, all of the users who held funds on that exchange have no recourse. The funds are gone forever and there’s no way to recoup losses.

AtomicDEX gives all users independence from custodial trading methods and allows users to trade directly with other users. It’s non-custodial, wallet-to-wallet trading. This makes trading digital assets magnitudes more secure than it’s ever been before.

Exercise The Right To Hold Your Private Keys

One of the primary benefits to using AtomicDEX is that you always maintain control of the private keys to your coins.

We at Komodo believe that holding your private keys is a basic blockchain right. You should exercise extreme caution any time that you are asked to forfeit control of your private keys. The old adage still holds true: not your keys, not your crypto.

AtomicDEX lets you trade from within your multi-coin wallet application. There’s never any need to make deposits and withdrawals, which means you never give up control of your private keys.

Your funds remain in your wallet at all times, even while trading. When you perform an atomic swap, the funds you are trading for appear in your wallet the second that the funds you are trading away are removed and sent to the counterparty of the trade.

Freedom To Trade Between Any Two Assets

Komodo’s new AtomicDEX protocol can technically support over 99% of all coins and tokens in existence. Any asset that supports time- and hash-locked payments can be listed on AtomicDEX.

Currently, only 13 different coins and tokens are available in the closed public beta version— BTC, USDC, ETH, BCH, LTC, DASH, QTUM, BAT, DGB, DOGE, RFOX, VRSC, and, of course, KMD. However, more coins will be listed with every new release.

Since AtomicDEX uses atomic swap technology, every listed asset can have a direct trading pair with any other listed asset. It’s direct, peer-to-peer trading for any two assets that traders want to exchange.

So, for example, the beta release of AtomicDEX will allow every asset to have 12 trading pairs. If a market arises between, say, QTUM and DGB, then users can trade directly between those two assets.

As more assets are listed in future releases, every coin and token can have hundreds of direct trading pairs, regardless of its total market cap or protocol. AtomicDEX gives you the freedom to trade between any digital assets without intermittent assets, intermediaries, or third-parties,

Freedom From High Trading Fees

AtomicDEX also gives users freedom from high trading fees. Trading fees on AtomicDEX are minimal— just 0.15% of the total value of the trade. The 0.15% fee is much lower than what centralized exchanges typically charge, which is often 0.2% to both parties.

Better still, only one party in the trade (the “taker”) must pay a fee. Market makers and liquidity providers pay no fees whatsoever. This incentivizes as many people as possible to become market makers and set up liquidity providing nodes, leading to ample liquidity on AtomicDEX.

Since AtomicDEX doesn’t require deposits and withdrawals, traders avoid long deposit and withdrawal wait times, as well as withdrawal fees and daily withdrawal limits. It provides the freedom to trade when you want, from your wallet, with very minimal fees.

Sovereign Smart Chains With Antara Framework

On July 15, 2019, Komodo will release the Antara Framework, which provides a simple toolkit for end-to-end blockchain development.

The Antara Framework has three layers: Smart Chains, Antara Modules, and the Antara Integration Layer. Smart Chains are customizable in 18 different ways, equipped with a built-in library of powerful modules, and capable of natively hosting blockchain-based applications in any programming language with an open API.

On top of all that, Smart Chains are completely sovereign and autonomous. Smart Chains are independent from the Komodo blockchain, in the exact same way that, say, Litecoin is independent from Bitcoin.

Litecoin was one of the first forks of Bitcoin, but we all understand that Litecoin has its own consensus rules, its own decentralized network with its own nodes and hash rate, and, most importantly, its own currency. Transaction fees on the Bitcoin blockchain are paid in BTC, whereas transaction fees on the Litecoin blockchain are paid in LTC.

All of these same things hold true for Smart Chains. Each Smart Chain has its own consensus rules, which can be customized prior to launch. Users can choose from Proof of Work (PoW), Proof of Stake (PoS), or any combination of the two. Smart Chains also have their own decentralized networks.

Smart Chains have their own coin. Miners are stakers receive compensation in that coin when they find or stake a block. Transaction fees are always paid in each Smart Chain’s native coin.

Creating an Antara Smart Chain offers all third-party projects complete sovereignty and independence. There is never any vendor lock-in or enforced dependence on the platform. Komodo believes that this autonomous, open platform model is the only way that businesses will be able to profitably integrate blockchain, which will ultimately lead to the acceleration of blockchain mass adoption and the parabolic growth of the Komodo ecosystem.

Declare Your Independence With Komodo

If you’re ready to declare your independence from custodial exchanges, sign up for the AtomicDEX closed public beta today.

If you’re interested in launching an independent Antara Smart Chain, send an email to [email protected] or join Komodo’s Discord community to learn more.

Declare your independence with Komodo and join us as we continue to deliver technologies that promote financial freedom for all.