Original: "Econia 101: A Breakdown of the On-Chain Order Book for Aptos"

Author: Econia Labs

Translation: Odaily Planet Daily News

This article introduces Econia, the on-chain order book DEX on Aptos, which provides high-performance, atomic settlement, and permissionless global access for DeFi trading experience. It aggregates liquidity into a single digital market, offering a trading experience similar to traditional exchanges while achieving the advantages of decentralization and user asset custody. Econia's atomic matching engine executes fast trades, reducing latency and minimizing MEV attack risks. For traders, developers, and institutions, Econia provides advantages in liquidity, efficiency, and innovation.

Translated by Odaily Planet Daily News.

What is Econia

Econia is an on-chain order book DEX running on the Aptos blockchain. Through high-performance engineering design, atomic settlement, and establishing permissionless global access to the market, Econia utilizes Aptos' optimistic concurrency model to provide users with a seamless and efficient trading experience.

Econia aims to aggregate liquidity from around the world into a single digital market. It serves as the core backend system for DeFi, invisible to users unless they are DeFi developers.

Why Choose Aptos?

Aptos' optimistic concurrency model allows parallel execution of transactions, enabling the blockchain to process tens of thousands of Move transactions per second. By utilizing transaction pre-settlement order and combining software transaction memory (STM), Aptos' block-level STM execution model can process a large number of transactions in fractions of a second.

Background of Econia Labs

Econia Labs emerged from the first Aptos Hackathon in 2021, where it won rewards. Following the Hackathon, Econia Labs was selected for the initial Aptos accelerator program queue and received a $6.5 million seed round investment, led by Dragonfly, with participation from Lightspeed Faction, Wintermute Ventures, Hudson River Trading, Flow Traders, Aptos Labs, and others.

The team members of Econia Labs have diverse backgrounds from renowned institutions such as Stanford University, Goldman Sachs, NASA, Garmin, and The Block, focusing on developing top-tier on-chain order books for the Aptos blockchain.

Why Choose Econia Over Centralized Exchanges or AMMs

Unlike automated market makers (AMMs), order books provide a trading experience similar to traditional exchanges like Coinbase Pro or Binance, granting users the ability to trade from non-custodial wallets. By combining the advantages of centralized exchanges (CEXs) such as efficient price discovery and minimal slippage with the advantages of decentralized exchanges (DEXs) (decentralization, permissionless, and user asset custody), Econia offers a trading experience that combines efficiency, fairness, and decentralization.

Econia's matching engine is atomic, meaning it executes all the steps required to settle market orders in a single trade. For example, when a user decides to buy or sell digital assets at the best price offered by the market, Econia matches their order with another market participant's limit order (bid or ask), updates the order book, and transfers assets between the parties, all within a single trade. This single-step trade would be impossible without Aptos blockchain's optimistic concurrency.

How Econia Benefits Traders

The order book is a fundamental financial primitive that aggregates liquidity into a global venue shared by all market participants, regardless of how they integrate. Particularly for Econia, its atomic matching engine reduces computational overhead, resulting in faster trade execution.

Econia's ability to process and execute multiple orders in parallel reduces system overhead, providing a more responsive trading environment. The engine's capability to handle multiple orders simultaneously also means it can handle higher trading volumes. Since Econia's matching engine executes all the steps required to settle market orders in a single trade, the trade speed is much faster than traditional decentralized exchanges, as there is no need to wait for multiple trades to be confirmed before the trade is considered final.

Overall, Econia's atomic matching engine provides an efficient trading experience. Users can efficiently trade their assets without worrying about delays or unexpected outcomes, while reducing the risk of MEV attacks.

How Econia Benefits Developers

Building and testing infrastructure can be a daunting task, but Econia's open-source project enables innovative participants in the crypto space to build, customize, and extend. Econia's ultra-parallel order book execution and settlement infrastructure provide a competitive advantage in the DeFi space for key partners.

Econia's API and SDK provide direct access to the Econia protocol, allowing almost any developer to create, access, and build on this innovative infrastructure. Econia Labs is also finalizing an open-source reference front end, allowing anyone to fork it and run their own customized trading dashboard, providing more access to Econia for users.

How Econia Benefits Institutions

As Econia aggregates liquidity into a global venue, institutions can trade with counterparties from various levels of the retail sector at extremely low spreads. Additionally, Econia's infrastructure is asset-agnostic, allowing institutions to trade in exotic asset categories such as derivatives or options that may not be available on centralized exchanges or traditional markets.

Conclusion

Econia is an ultra-parallel on-chain order running on the Aptos blockchain. Compared to centralized exchanges and automated market makers (AMMs), Econia offers advantages for traders, developers, and institutions, allowing key participants in the DeFi space to benefit from the liquidity, efficiency, and innovation provided by Econia.

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