How to get the CEX trading experience on a DEX. A simple DeFi limit order protocol explanation and help guide.

Introduction A few months ago, like many others, I dipped my toes into DeFi trading after hearing about the potential of a few projects based in that scene. I found the concept pretty interesting; the ability to instantly swap crypto (called “tokens” when hosted on a DEX) without using any intermediaries was phenomenal. However, I was a bit put off by the lack of control over my trades. In case you didn’t know, when you perform a swap (trade), an Automated Market Maker (AMM) executes what is basically a market order for the listed price. This is well and good if your trading strategy is simply buying, keeping an eye on your holdings then selling when the price is right, but I found that this wasn’t ideal in the case of my DeFi investments, which could fluctuate wildly overnight. I was also used to my CEX, which allowed me to place what is called a Limit Order. A quick note on limit orders. A limit order simply lets you put up a notice saying “I’d like to buy/sell this asset at this price”. If the asset hits your preferred price, then the order triggers. I frequently use these to set my exit point, so I still get to take profits if the asset fluctuates while I’m away from my desk. You can also use limit orders to automatically buy in at a preferred entry price. Moving on... The lack of this functuality in DeFi obviously frustrated me a bit, so I pulled up Google and set about finding any services out there that could help me out. I decided to do this writeup to save anyone reading this the hassle of weeding out a reputable service out of the myriad that exist, so hope this helps. My favourite Limit Order providers I researched and experimented with providers, but the ones I ended up using the most were 1inch and bogged.finance. I’ll lay out a few pros and cons for each below. 1inch Pros: -The only fee is the gas cost needed to make the transaction -Available on multiple chains (Eth, Bsc and Polygon) 1inch Cons: -Orders often don’t fill. 1inch relies on there being a taker for every order that is made. This means you can’t set orders for low volume tokens, meaning you could miss out on trades. After losing quite a bit of money to this I soured on 1inch altogether bogged.finance Pros: -Order is guaranteed to fill as they use automated systems to place an order when the target price is reached bogged.finance Cons: -only available on BSC so far, but the devs have indicated that they will be expanding to 7 others chains within the next month, including Eth and Polygon -Each order costs $2.50 and must be paid in their native token So which one would I choose? So far, I’m stuck using 1inch for my Eth trades, but as I said earlier, the unreliability has been a pain to deal with. I’m looking forward to seeing how well bogged.finance implements their Eth chain support, and if done well I’ll likely use them solely for setting limit orders, as the few BSC orders I’ve placed using them have gone off without a hitch. submitted by /u/Cybergrany [link] [comments]