Square advances on its DEX project
Jack Dorsey, CEO of Square and Twitter, is moving forward on his Bitcoin-focused Decentralized Exchange (DEX) project. TBD, Square’s new division, released a whitepaper on Friday featuring “tbDEX”.
In July, the entrepreneur said Square was working on creating an “open source platform” to deliver BTC-focused financial services. Thus, Square wants to develop a decentralized exchange that is entirely “native Bitcoin, top-down and 100% open source.”
According to the document, it would still be difficult for amateurs and laymen to access decentralized finance applications. We can read :
“TbDEX is a protocol allowing the provision of liquidity and the exchange of assets in complete security. We need a better gateway from the fiat world to the crypto world. The tbDEX protocol aims to solve this problem. “
Accessibility at the expense of decentralization?
It is not a decentralized exchange in the true sense of the word, but a peer-to-peer (P2P) exchange platform under the supervision of Square.
Thus, tbDEX has many features that make it much less decentralized than DEXs such as Uniswap (UNI) or SushiSwap (SUSHI). For starters, and not least, the protocol will require all users to disclose their identity. Only then will they be able to connect their wallets to the tbDEX exchange and trade cryptocurrencies. However, this identification process is partly decentralized according to the whitepaper.
In addition, Square advocates the deployment of analytics solutions such as Chainalysis to track transactions on the platform. An integration that is already controversial.
The centralized aspect of tbDEX goes even further. According to the whitepaper, Square could even reverse or cancel certain transactions on the exchange in the event of a user error. The American company invited observers to comment on the white paper.
About the author: Florent David
Engaged in the crypto ecosystem since 2017. I am particularly interested in decentralized finance (DeFi), Ethereum 2.0 and non-fungible tokens (NFTs).
All articles by Florent David.