Executive Summary: Competitor Analysis of the Injective Protocol
Competition in the business world is normal. Especially if the business is in an ecosystem that is currently popular, it will definitely attract many people. The logical compensation is, of course, the existence of “war” in seizing the market. This competition can be a great tool for creating varied innovations. With this enthusiasm, it can trigger demands for issuing ideas, strategies or creativity that are more attractive to investors and users. Competitor analysis helps a project determine the potential benefits and constraints in the market regarding its product or service. In general, this can help a project set strategies in various fields such as marketing, product/service pricing, and distribution activities.
In the previous article, I discussed the advantages of DEX and CEX, and business model of Injective Protocol. Please read the full explanation here
Injective Protocol — How to Fully Decentralized Trading an Easy Way
Fast, Secure, and Fully Decentralized Trading
Then in this article, I will focus on discussing competitor analysis of the Injective Protocol. Some of these competitors include DerivaDEX, IDEX, FutureSwap, BitMEX, FTX.
Advantages Over CEXs
In general, CEX and Dex have their advantages and disadvantages. In my opinion, DEX security is better than CEX, more resistant to hacking attacks.
🚀Solutions for safety and speed
Injective Protocol offers security that will make users feel safe. The network is protected from hacking and manipulation of trade and exit scams. With a truly decentralized platform, users really have full control over their funds and can trade p2p in full. Sidechain in real-time will show orders made by traders.
🚀 Liquidity solutions and Unique Offerings
Liquidity is one of the challenges in trading on DEX. Injective Protocol is committed to overcoming these problems by establishing good cooperation with related parties to improve liquidity. Derivatives in the world of crypto have good potential, this has been marked by the extraordinary increase in the volume of derivatives trading lately. The fully decentralized Injective Protocol is perfect for this niche, allowing users to create and trade derivative markets that cannot even be supported by centralized exchanges that we know provide strict restrictions and rules for users.
Injective will not run the risk of server downtime because the hosting is distributed through the node. Regarding security, privacy and identity, you don’t need to worry. Funds in a decentralized exchange will be stored in your own wallet, not in the wallet provided by the exchange. You don’t need to give out personal data to anyone.
🚀 BitMEX vs Injective Protocol
BitMEX is the largest crypto derivative exchange and was re-launched in 2014, founded by Arthur Hayes, Samuel Reed, and Ben Delo. Bitmex has the largest amount of liquidity on the market. BitMEX offers the ability to trade perpetual BTC contracts and other coins such as ETH, ADA, EOS, BCH, LTC, TRX and XRP. From the security side, BitMEX is fairly safe and offers a number of direct channels for users to contact their customer support team. BitMEX charges 0.075% for the market taker and -0.025% for the market maker.
One of the biggest weaknesses of BitMEX is the slowness caused by very volatile and large market movements.
Injective Protocol is fully decentralized. With an ecosystem like this, it strongly supports derivatives trading, which is not fully supported by CEX because it requires strict rules and restrictions. Other Injective advantages are: you have the opportunity to get trade-mining prizes, insurance funds, censorship resistance, and revenue sharing. Injective Protocol allows users to trade in the derivatives market freely. This is a large market that has not yet been exploited and has a great opportunity to serve unmet needs even by CEX.
Advantages Over Other DEXs
By using DEX, your funds are always in your hands, this eliminates security problems that interfere with CEX. DEX has grown and is popular in recent years, more than one hundred decentralized exchanges are being developed and available for direct trade. This is amazing, right? This development is getting better because of the rampant cases of hacking at CEX. The devs also competed to offer innovation in trading experience using DEX. On this occasion, I will try to explain the comparison between Injective Protocol with other DEX that already exists today.
🚀 IDEX vs Injective Protocol
IDEX was launched in October 2016, founded by Alex Wearn (Co-founder/CEO). IDEX is the first Ethereum based to support real-time trading. IDEX offers trading with the ETH chain, with services supporting market orders and limits, gas-free cancellations, and the ability to fill many trades at once. IDEX charges 0.2% for the market taker and 0.1% for the market maker, You also have to pay a gas fee to put transactions on the blockchain.
IDEX began enforcing new user registrations and KYC from August 2019. Related to this, there was a lot of criticism because it is quite contrary to the basic principles of DEX which gives full privacy to users. With IDEX requiring KYC, the benefits of maintaining user privacy are removed.
Can an exchange that requires KYC call itself a DEX?
One of the main objectives of the Injective Protocol is to establish a truly decentralized ecosystem so that users do not need to do KYC. Related to market taker and market maker fees will be announced soon by the Dev team. Injective Protocol is a layer-2 scale, this allows users to make deposits/withdrawals for trading as often as possible. In addition, you can enjoy order cancellations for free and almost instantly using the decentralized Injective trade execution coordinator. Another advantage is The 1-round settlement model, in general, is about how Injective Protocol can complete order transactions in 1 block using VDF (Verifiable Delay Function).
Injective protocol has several advantages as DEX compared to CEX and other DEX. With a truly decentralized platform, privacy, identity and funds are entirely in the hands of users. Many profitable offers, including the derivative market and cross-chain trading.
Disclaimer: This article is not investment advice, just for knowledge and education. Do a thorough independent analysis before making any decision. DWYOR.
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