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12/14/2023

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DexHunter: Benefits of DEX Aggregation Explained

How DEX Aggregation and Partial Fills Offer Better Prices and Flexibility, Illustrated with a 1000 ADA Example

DexHunter: Benefits of DEX Aggregation Explained

How DEX Aggregation and Partial Fills Offer Better Prices and Flexibility, Illustrated with a 1000 ADA Example

DEX Aggregation Benefits

Let's take a look at a couple of direct benefits for traders from using DexHunter DEX aggregator compared to trading on a single DEX:

  • Best Trading Prices: By accessing multiple exchanges at once, DEX aggregation ensures traders find the best available price for their assets, optimizing their buying or selling experience.
  • Partial Fills: DEX aggregation minimizes the risk of price changes during trade execution, making transactions more predictable and closer to the expected price.
  • Enhanced Liquidity: By pooling the liquidity from various exchanges, DEX aggregation makes it easier to trade large quantities without substantially affecting the market price, accommodating various trading needs and preferences.

Example: Swapping 1000 ADA to Y Token

You want to swap 1000 ADA for Y Token. You have three options:

Using DexHunter (DEX Aggregator):

  • DEX A: 600 ADA at 2 Y Tokens each = 1200 Y Tokens.
  • DEX B: 400 ADA at 1.95 Y Tokens each = 780 Y Tokens.
  • Total using aggregator: 1980 Y Tokens.

Swapping Directly on DEX A (With Price Impact)

  • Total on DEX A only: 1960 Y Tokens.

Swapping Directly on DEX B (With Price Impact)

  • Total on DEX B only: 1940 Y Tokens.

Summary

Using an aggregator, you get 1980 Y Tokens, which is 20 more than using DEX A alone and 40 more than using DEX B alone. The aggregator leverages the best prices, minimizing the price impact, and maximizing the Y Tokens you receive, this also works the other way around for selling tokens for ADA.

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ORIGINAL SOURCE

https://dexhunterio.medium.com/dexhunter...

Disclaimer: Cardano Feed is a Decentralized News Aggregator that enables journalists, influencers, editors, publishers, websites and community members to share news about the Cardano Ecosystem. User must always do their own research and none of those articles are financial advices. The content is for informational purposes only and does not necessarily reflect our opinion.


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