Why using Shiftly? — What makes us different from a centralized exchange like ShapeShift!
By: Edouard Soutzo
Tags: Cryptocurrency, Decentralization, Cryptocurrency News, Ethereum, Blockchain

Keep your tokens safe:

You probably have heard of recent centralized exchanges hacks such as Mt.Gox ($400M), Bitfinex ($66M) or Coincheck ($500M). These are only a few examples. Even the biggest exchanges out there get hacked.

Depositing your tokens into a centralized exchange means that you give them custody of your tokens. You thereby agree to their KYC procedures, policies and security measures. In addition, people sometimes have no alternative to trade certain ERC20 tokens as they are only available to trade on certain exchanges.

Never forget that you account is not regulated by a supra-national authority. In case of a hack, you will be solely dependent on the goodwill of the exchange and on their policy with regards to security and hacks. Moreover, untrustworthy exchange owners can literally vanish with your funds.

The decentralized approach, however, mitigates this concern. Trading in a decentralized fashion using an online wallet such as metamask or your own hardware wallet removes the custody risk associated with centralized exchanges.

Shiftly Vs. Centralized exchanges: What makes us different!

We wanted to come back on what makes us different relative to Centralized exchanges.

1) Accounts, deposits & withdrawals

Unlike a centralized exchange, you do not need to create an account to start trading with us. As we are fully decentralized, trades occur through your own wallet (Metamask) or hardware (Nano Ledger). Consequently, there is no need for users to make deposits ahead of trading, nor to withdraw their tokens after a trade has been executed. Tokens are directly sent to your wallet.

There are no deposit or withdrawal fees, limits and delays.

2) Custody

One of the main advantage of decentralized exchanges is the fact that users maintain custody of their tokens. Maintaining custody of your tokens mitigates most of the risks associated with centralized exchanges:

Hacks/withdrawal issues and delays/exchange shutdown/Etc.

3) Interoperability: Leveraging the existing protocols such as 0x and Kyber Network:

We have decided to launch our beta using the 0x protocol open order book strategy.

We are assessing the 0x network liquidity pool and ecosystem development, which has been amazing so far.We are also looking at protocols such as Kyber Network in order to guarantee liquidity to our users.

We will also work hard so that our exchange can be easily integrated with aDapps/apps and other relayers and projects with which synergies can be generated.

The relayer model designed by 0x allows us to:

Match transactions off-chain and to settle them on-chain in a friction-less manner.

Maintain lower transaction costs than centralized exchanges (no deposit or withdrawal fees, and much lower transaction costs).

Offer the highest level of security through decentralization.

A lot of decentralized protocols have emerged over the last year to meet the growing demand for dencentralized exchanges. We believe that 0x his one the strongest project, both for its technical model and community of developers. We have witnessed a growing number of projects based on the 0x protocol (mainly relayers, such as Radar Relay, Paradex or ErcDex) and we have no doubt this is just the beginning!

Kyber Network’s Guaranteed Liquidity:

We are looking to integrate Kyber Network to our matching algorithm, liquidity being one of our main concern. Kyber Network is another project that we have been following actively and which also has a solid community of developers and users.

We are also looking into other protocols and new technologies that we could integrate to make our engine as efficient as possible.