Centralized exchanges provide leverage to their users, but do so through centralized ownership of funds and opaque processes. This creates unnecessary trust and security risks for the trader which have no relevance to the trade itself. Dexta eliminates these risks by offering leverage on a fully decentralized, on-chain protocol.
Dexta offers up to x5 leverage for makers and takers. Existing on-chain lending platforms such as Compound provide margined leverage only on swaps and market orders. This makes these platforms useless for market makers. Dexta Exchange solves this by using order books.
The amount of leverage available for a user is based on the sum of the user’s deposits and positions. The collateral ratio is the sum of the user’s deposits and positions divided by their loans. To obtain leverage, a user will need to provide 130% of collateral and will need to keep the ratio above 120% to avoid liquidation. If a user’s collateral ratio drops below 120%, the account will be liquidated. Liquidations can be claimed by any account. To ensure accuracy, account values will be calculated using a combination of Dexta protocol prices and price feeds provided by standard decentralized oracles. As the protocol develops reliance on oracles will be removed.
A selection of tokens are already available for lending and borrowing through the order book and in the future, more token pools will be added as the platform develops, with the potential of allowing custom token pool creation.
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