A new and interesting form of exchange known as decentralize exchange has popped into public’s eyes and becoming increasingly popular these days. In this form of trading, buyers and sellers are connected directly without the need of a party that takes control of everything like a centralized exchange. 0x is one of the famous and high-profile player among the decentralized exchange community for trading ERC 20 (Ethereum Request for Comment) token.
So, what exactly is 0x and how is 0x set itself apart from regular trading model? As the website suggest, 0x is an open protocol specialize in offering decentralize exchange as part of Ethereum blockchain. The creator of 0x believes that in the near future, all sort of assets ranging from precious metal to stock to land properties will be transacted and traded in the form of crypto coin on blockchain network. Since the existing Ethereum network is well equipped with wide range of decentralized application (Dapps) and offers a great degree of flexibility, it is an ideal platform or medium to facilitate the revolution in great revolution in assets exchange. Most of the cryptocurrency exchanges available on the market follows the conventional trading model which is centralized. In this mode of operation, party in control will be responsible in providing infrastructure as well as facilitating trade and transactions between parties by playing the role as an connecting agent. A well-known exchange that currently operate under this paradigm is Coinbase, the largest crypto exchange in North America. While this approach was perfectly fine for equity market, rising frequencies in hacks targeting crypto exchange suggests the need of a new operating paradigm for crypto market and decentralized trading might just be the solution to the issues.
This is where 0x marches in. The protocol of 0x makes a huge positive impact on exchanges by using off-chain ordering relays along with on-chain settlements. To vastly simplify it, 0x aimed to achieve a vision of providing an efficient and trustworthy way to exchange thousands of tokens created on Ethereum by combining strengths of both decentralized and centralized exchange.
Here is the PDF of 0x (ZRX) whitepaper for reading and downloading purpose.