Aurora (IDEX)

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  • Aurora
    TypeNative currency of a DEX
    Total supply1,000,000,000 IDEX
    Websitehttps://idex.market/

Basics

  • Founded in:
  • Mainnet release:
  • Based in:
  • Exchange. By the founder himself (1-11-2018): "IDEX is not a “DEX” in its current state. At this point the best way to describe IDEX is as a “non-custodial” or “hybrid-decentralized” exchange."
  • Their IDEX can be used to trade ERC-20 tokens.
  • From Messari (10-2019):

 "Aurora is a collection of blockchain applications that form a completely decentralized financial and banking platform. Founded by a group of blockchain enthusiasts who aspire to see digital currency flourish, Aurora aims to provide these decentralized financial solutions to anybody in the world, regardless of location and status."

Aurora's flagship product—IDEX—is the first real-time, non-custodial trading platform to provide on-chain settlement and self-custody through the use of a hybrid architecture. Users must approve every transaction with their private keys, ensuring they are always in control of their funds, while the platform handles broadcasting transactions to the blockchain. This allows IDEX to update account balances and order books in real time, giving users the experience of a centralized trading platform without sacrificing security or user control. IDEX will evolve into a fully-decentralized trading platform through AURA staking. This will allow users who hold and stake AURA tokens to run specialized nodes that perform various exchange functions. In return for decentralizing various “tiers” of IDEX’s architecture, node operators earn compensation in ether (ETH) based on their AURA staked, node tier, and node uptime.

Aurora will also develop a stablecoin (the boreal) and banking platform (Decentralized Capital) that integrate with IDEX and the AURA staking network."

History

  • Aka Aurora DAO but rebranded (8-5-2019) to IDEX. On why they rebranded:

"Over the past 1.5 years we’ve built IDEX into the most successful dApp ever, with 2x the number of transactions as Cryptokitties, and recently surpassing Ether Delta for the most DEX trades of all time. IDEX has become synonymous with a secure, fast, peer-to-peer trading experience. At the same time the parent brand, Aurora DAO, has gained a limited following, led to analyst confusion, and created many annoying or awkward intros at conferences (Alex from Aurora DAO…we created IDEX).

The IDEX token is an exact 1:1 mirror of the AURA token. IDEX token serves the exact same purpose as the AURA token, and no new functionality is being added."

  • However, on their website AURA is still mentioned as of 10-2019, but if you click further, the 'Learn More' link will link to a post in which the first thing mentioned is "Note: AURA has been swapped for the IDEX token"

Token

Launch

"Aurora completed a token sale in January 2018. A total of 2,000 IDXM tokens were created with 1,600 distributed to token sale participants. Participants also received 80 million of the 100 million AURA tokens created."

Token allocation

Utility

Token Details

Stablecoin

Boreal

"Boreal is the stablecoin of the Aurora network. Inspired by free banking, each boreal is backed by a combination of dapp endorsement and debt from loans.

Dapp support begins with IDEX, as Boreals will always be accepted at their target value as payment for trade fees. Guaranteed redemption on IDEX will help maintain the price as traders are incentivized to purchase boreals and lower their trading costs whenever the currency falls below target. Boreal will also serve as a base asset, allowing traders on IDEX to minimize risk by trading against a stable base currency.

As boreal usage grows, Aurora will begin to issue loans in the currency through the first cryptobank, Decentralized Capital. These debts will act as another form of collateral for boreals and will generate additional boreal demand due to the required use of boreals in loan repayment, both principal and interest."

Tech

Transaction Details

How it works

"Aurora’s flagship product is IDEX—a real time, non-custodial trading platform. IDEX is composed of a centralized trading engine, decentralized Ethereum smart contracts, and a network of AURA node operators. The trading engine hosts the off-chain balances and orderbook, matches trades, and manages the queue of pending transactions, while the Ethereum smart contract stores all assets and manages trade execution and settlement. By separating trade matching from on-blockchain settlement, IDEX combines the speed and user experience of centralized trading platforms with the security and auditability of decentralized platforms.

The first iteration of IDEX is semi-decentralized; the trading interface is run locally by the end user, while Aurora manages the server responsible for matching and settling trades. However, with the release of AURA staking, trading fees collected by IDEX is earned by participants running the staking client (AuraD) in return for helping manage specific platform functions (e.g. trade history)."

"Unlike Uniswap, IDEX is a hybrid, semi-decentralized exchange. Similarly, IDEX provides a trustless, real-time, high-throughput trading experience in conjunction with blockchain based settlement. By centrally managing trade matching and Ethereum transaction dispatch, IDEX enables users to trade continuously without waiting for transactions to mine, fill multiple orders at once, and cancel orders immediately without gas costs.

All transactions, such as deposits and trades, must be authorized by end users and their private key, but IDEX maintains ownership of broadcasting these authorized transactions to the network. By carefully sequencing the dispatch of these authorized transactions, IDEX provides the speed and user experience of a centralized exchange combined with the security and auditability of a decentralized exchange.

IDEX currently uses two native tokens, AURA (As of 8-5-2019 IDEX) and DVIP, to further incentivize usage of the platform. Simply put, AURA is staked to earn a percentage of all transaction fees on the network. AURA can be used to purchase DVIP tokens (1 DVIP = 50,000 AURA) which are used to purchase IDEX memberships, granting users discounts on trading fees on IDEX transactions. DVIP memberships will last until 2020, granting users either free trades and no AURA rewards,  2x Market Making rewards and full trade fees or some combination of both."

Staking

  • Their first step, Tier 3, has been live since 1-2019.
  • From the IDEX website (10-2019):

“Every 5 minutes of uninterrupted uptime adds to the weighted amount (credit) for each staking period.

Every 10k IDEX token staked per 5 minutes earns 1 credit. Fractional credits can be earned (e.g. 11.5k IDEX token would earn 1.15 credits).

For example, if you staked 10k IDEX token for half of a full period, you would earn roughly (14 day period/2 * 24 hours * 60 minutes * 1 credit) / 5 minutes = 2k credits.

Tier 3 stakers earn 25% of all ETH earned by IDEX. At the end of a staking period, fees are distributed to users based on the percentage of the total credits they earned within a period. For example, if a user earned 1% of the credits for a period, they will earn 1% of the payment for that period.”

  1. "AURA staking nodes will be rolled out in stages along 3 staking “Tiers” — each decentralizing unique IDEX exchange functions. They will be released in the following order: Tier 3 (Trade History) → Tier 2 (Transaction Arbiter) → Tier 1 (Distributed Orderbook).
  2. The alpha AURA staking software will most likely be released in Q4, allowing users to begin running Tier 3 (Trade History) staking nodes. Users running these Tier 3 nodes will be collectively rewarded with 25% of all IDEX trading fees — claimable in ETH proportional to AURA stake and uptime. The minimum staking requirement for a Tier 3 node is 10,000 AURA.
  3. Ultimately we envision the allocation of fees to be roughly 25% to Tier 3 (Trade History), 33% to Tier 2 (Transaction Arbiter), and 42% to Tier 1 (Distributed Orderbook) once the AURA staking network is fully developed. Please note that originally we anticipated an initial 50% distribution of IDEX fees based on the assumption that all AURA staking would go live simultaneously. However, given the new strategic rollout plan and our ultimate goal of giving 100% of Aurora of fees back to node operators, we have adjusted the estimated allocations accordingly.
  4. Network changes will be made internally at regular intervals to start, but in the end all governance will be handed to those staking and running the network."
  • A year after (10-2019) the above post, IDEX_Bane said this about the progress in their Discord channel:

“1. Only Tier 3 is available for staking

2. There are no information about other Tiers yet, they are are still in development”

When asked about how much governance they had given over to the nodes, IDEX_Bane linked to the before mentioned year old post.

When asked for a roadmap the answer was:

“We don't have an ETA for that yet as we are going to release major updates for IDEX later this year. Blog post about those updates is coming out soon.”

"200 nodes signed-up within 72 hours, and the network has stabilized at over 300 active nodes

~50% of the circulating supply is being staked, a phenomenal level of participation by our community."

Liquidity Mining

Scaling

Different Implementations

Interoperability

Other Details

Privacy Method

Compliance

"Last week we announced that IDEX has begun blocking access to NY IP addresses. In addition to blocking IPs in NY, North Korea and Iran, we will also be rolling out IP blocks to Cuba, Syria, Crimea and Washington state.

  1. Decentralization exists on a spectrum, and unless your system or application lacks any centralized parts it can be subject to regulation
  2. Aurora is working to create a fully-decentralized financial system, but the path to getting there requires significantly more control and centralization than the end state
  3. In addition to IP blocking, IDEX will be implementing KYC/AML policies in order to comply with sanctions and money laundering laws"

"We previously announced our intention to incorporate KYC and AML compliance policies into the IDEX platform. Today we’re ready to share that current and new IDEX users will be able to create accounts and get verified for KYC starting Wednesday, July 24, 2019. As part of our continued commitment to compliance and security, IDEX will also begin limiting access to certain assets for US customers in the coming weeks.

When KYC goes live on Wednesday, July 24, 2019, it will mark the beginning of a 30-day transition period. All wallets accessing IDEX will continue to be able to make unlimited trades and withdrawals of up to $5,000 USD per day without an account and without verification."

  • The following comes from a post (29-10-2019) by competitor Komodo (which is the creator of AtomicDEX), so should be read sceptically:

"To use IDEX, you need to deposit funds, but unlike centralized exchanges, smart contracts control funds (rather than one or several individuals). It makes IDEX more secure in comparison to centralized exchanges but it is far from being fully decentralized. IDEX uses the Ethereum blockchain as a settlement layer, yet everything is first updated on their centralized database before being written onto the blockchain. Smart contacts control real funds, but the IDEX database controls how these funds are distributed. 

This architecture helps IDEX to provide better UX, and that’s why IDEX has comparatively high liquidity. However, pushing every trade on the blockchain is costly, and having a centralized database creates a risk of censorship while also jeopardizing user privacy. At the same time, the IDEX model eradicates the security problems of centralized fund storage, so it’s more secure than a CEX. They also have a utility token, called IDEX, which is used to secure the network on which IDEX runs.

IDEX started enforcing user registration and KYC on the platform from August 2019. While the protocol itself is still somewhat decentralized, this creates a counterparty risk and raises questions about the future of the platform."

Oracle Method

Their Other Projects

Decentralized Capital

  • Comes from Aurora (10-2019):

"Aurora is a collection of blockchain applications that form a completely decentralized financial and banking platform. Founded by a group of blockchain enthusiasts who aspire to see digital currency flourish, Aurora aims to provide these decentralized financial solutions to anybody in the world, regardless of location and status.  

Aurora will also develop a stablecoin (the boreal) and banking platform (Decentralized Capital) that integrate with IDEX and the AURA staking network."

"Decentralized Capital provides loans to users anywhere in the world in the form of boreals, the price-stable cryptocurrency of the Aurora ecosystem.

Inspired by F.A. Hayek’s and George Selgin’s work on Free Banking theory, DC is using blockchain technology to address issues with currency stability and loan accessibility. DC utilizes blockchain based identity systems such as uPort, combined with in-house and blockchain based credit ratings such as Bloom, to minimize loan default risk and bring a digital banking solution to consumers in all parts of the world."

Governance

DAO

Admin Key

"Idex.io has a Governance.md file that contains information about admin controls. The type of ownership is clearly indicated (OnlyOwner / MultiSig / Defined Roles) All contracts are clearly labelled as upgradeable (or not). The capabilities for change in the contracts are described. Pause control not documented or explained."

Treasury

Upgrades

"Today IDEX rolled out a large update focused on improving users' experience. The upgrade features off-chain order matching, which makes trading faster and more secure. The next stage for IDEX is to introduce layer-2 trading without gas fees."

Roadmap

From their own website (10-2019):

  1. October 2017 - IDEX launch on the mainnet. Semi-decentralized architecture consists of Ethereum smart contract plus central trading engine and transaction arbiter.
  2. October 2017 - API integration. Opening the platform via API access has enabled the development of trading bots, increasing liquidity and improving market efficiency.
  3. December 4th 2017 - IDXM membership sale starts
  4. January 2018 – AURA airdrop on IDXM holders
  5. Q3 2019 – Boreals deployed to production
  6. Q3 2019 - Deploy childchain architecture, allowing IDEX to increase transaction throughput.
  7. Q1 2020 - Margin trading support. Including this functionality in the protocol will put the UX on par with existing centralized exchanges.
October 2017 IDEX Launches on Ethereum Mainnet Semi-decentralized architecture consists of Ethereum smart contract plus central trading engine and transaction arbiter
January 2018 Public Token Sale IDXM (IDEX Membership) token sale starts. Each IDXM purchased entitles users to 50,000 free AURA (delivered via airdrop).
January 2019 AURA Staking Launch IDEX launches alpha version of AURA Staking software—AuraD. This enables users to run AURA nodes and earn fees collected by IDEX in return for further decentralizing the exchange.
  • When asked for a roadmap the answer in their Discord channel (2-10-2019) was:

“1. Only Tier 3 is available for staking

2. There are no information about other Tiers yet, they are are still in development”

3. We don't have an ETA for that yet as we are going to release major updates for IDEX later this year. Blog post about those updates is coming out soon.”

Audits

  • There is no apparent bug bounty program (19-5-2021).
  • IDEX 2.0 got audited by Quantstamp (21-7-2020). IDEX V2 was released October 16th.
  • Score of 37% on DeFi Safety (19-5-2021): "Pretty good except Access Controls. Just tell us what the admins can do, that's all."

Bugs

Usage

  • IDEX is currently the largest DEX on Ethereum. At the time of writing (8-2019), IDEX is said to account for 51% of all DEX volume on etherscan. By 9-2020, IDEX has become marginalised due to new KYC rules and Uniswap becoming the new top dog in town.
  • The most widely used application on Ethereum (11-2018) after more than a year in operation, it has a pitiful 1,000 daily users. 

Projects that use or built on it

Competition

Coin Distribution

Pros and Cons

Pros

Cons

Team, Funding, Partners

Team

Funding

"Raised $2.5 million to relaunch as a trading platform accessible to market makers and algorithmic traders. The money came in a seed round led by G1 Ventures and Borderless Capital, with other commits from Collider Ventures and Gnosis. IDEX's creator, Panama-based Aurora Labs, raised $6 million in an initial coin offering (ICO) in early 2018."

Partners

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