DEX Bancor Launches 'Carbon' On-Chain Trading Platform

On the Ethereum network, Bancor, a decentralized exchange (DEX), has launched the on-chain trading platform Carbon.

The announcement follows a request for deployment on Ethereum from Bancor's decentralized autonomous organization (DAO), which received 100% support for launching. A means for supplying markets with liquidity is an automated market maker (AMM) smart contract, which is what Bancor makes use of.

DEX Bancor Starts On-Chain Trading Platform Carbon

According to a news release, Carbon's mission is to improve trading on DEX by using CEX-style trading features with AMM-style accessibility and transparency.

According to the press release, Carbon will establish a single focused liquidity position that exclusively buys and sells in particular price ranges. Swing trading on any ERC-20 token may be automated by setting buy and sell ranges above and below a predetermined price based on user expectations for how a particular token will move, according to the press release.

According to Nate Hindman, Bancor's head of growth, liquidity pools normally demand customers supply liquidity throughout a continuous range of prices, whereas Carbon gives consumers the option to choose between purchase range and sale range.

Customers will be able to "use a single liquidity position to set a buy range [e.g. buy $2,000-$2,100 worth of ETH] and a separate sell range [sell ETH between $2,300-$2,400]," according to Hindman.

As ETH fluctuates between certain areas, this will allow users to acquire the token at a discount and sell it at a premium. To fill the orders, the liquidity automatically switches between the users' ranges. This is a model that has been used on centralized exchanges but has not been used on DEXes, according to Hindman.

"Bringing the trading functionality of CEXs to DEXs is key to driving the next wave of traders on-chain," he continued.