The bZx Network is building a protocol that enables DEXs to facilitate margin-trading.
Any crypto exchange — centralized or not — can fold the bZx protocol into their platform and begin offering customers the ability to loan and borrow ERC20 tokens.
In previous articles, we discussed tokenized loans and a blockchain-powered insurance policy.
Now, unlike the majority of ICO projects in the digital realm of crypto, bZx already has a MainNet DApp up and running.
And that very same DApp is the subject of this article. But before we get too deep, just in case you haven’t seen it yet…
Disclaimer: This is not investment or financial advice. I’m not a financial expert by any stretch of the imagination. Most information within this article is speculative and merely my own personal opinion. Always conduct your own research before contributing to any startup projects.
Always remember that what you do with your funds is your decision to make. And if that decision proves too difficult for you alone, seek guidance from a financial professional.
I may receive a small allocation of tokens for creating this content. That said, I will do my best to remain unbiased and fair. I try to avoid all FOMO and FUD and never wish to impart those emotions on my fellow crypto-heads.
Since we’re accessing a DApp built on the Ethereum blockchain, we’ll need a way to interact with the network. Chrome browser extensions like MetaMask let you do just that.
Now, I’ll be honest with you here. I’m writing this while simultaneously going through the system’s sign-up process as a brand-new user. I didn’t complete a dry-run ahead of time.
The point is to test the complexity of adding tokens to the bZx Network. If the process isn’t fairly straightforward for someone like me — very comfortable with centralized exchanges but sometimes bewildered by DEXs — then I can only hope some UI upgrades are in the works.
So, since this is a trial, we’ll go with the Ropsten Testnet via MetaMask.
After launching and logging into MetaMask first, I clicked the little fox icon in the portal’s ‘Choose Wallet Provider’ popup window.
And with that, a single click, we’re in.
Wrap it Up
Ironically, the Ether flowing through the Ethereum network doesn’t conform to its own ERC20 standard.
And there’s a great reason for that. ETH came into being prior to any ERC20 tokens being built upon its network.
So, in order for you to make your ETH operate on the bZx Network, it’ll first have to filter through a smart contract that transforms it into W-ETH.
The process is a simple 1:1 swap. And you can trade W-ETH for original recipe ETH anytime you’d like. Even better, this whole wrap/unwrap process should one day fade away.
But for now, it’s a necessity…
Clicking the blue ‘WRAP ETH’ button activates a user-friendly popup:
I can see how someone might get a little squeamish transforming their ETH to an alternative version. Especially if the process is cumbersome or too technical.
Thankfully, the bZx platform makes trading back and forth very easy to do.
You may not be interested in loaning ETH and would prefer to let borrowers trade your altcoins instead. Here’s the place for you to inject them into the portal.
We’re still on the ‘Balances’ page but this is where the scrolling ends.
By default, only WETH is tracked.
To add extra ERC20 tokens, you’ll use the ‘Add new tracked token’ section populated with everything you can use on the network. As the bZx platform evolves, this section will keep proliferating until a drop-down menu is needed.
But for now, we’ll add the native token of the bZx project’s strategic partner — KNC from KyberNetwork.
Once again, the portal’s simplicity shines brightly. With a single click of the ‘ADD TOKEN’ button residing beneath the logo of any available ERC20, it’s added to the ‘Tracked tokens’ section:
Then, hit the ‘APPROVE’ button to activate the token.
Just like wrapping and unwrapping your ETH, adding ERC20 tokens to the bZx platform is very straightforward. Which is exactly what I was hoping for.
Next, we’ll head over to the page that lets you interact with all the W-ETH and ERC20s you’re prepping for margin trading.
Welcome to bZx, Can I Take Your Order?
Now that we know how to populate the network with tokens, it’s time to put those tokens to work.
On the portal’s ‘Orders’ page, you can set a host of parameters. First, you’ll decide if you’re lending or borrowing.
Choose an oracle — there’s only one for now but more are coming — and then set the number of tokens you’re temporarily parting with.
As a lender, you determine the token you’re loaning along with the token you’ll be rewarded with.
Now, in order to become a borrower, you’ll need to define those as well as come up with some collateral for use in the event of forced liquidation:
Put up your DAI and place your bets. If you’re a trader on the winning side of your gamble, congratulations! You’ve beaten the odds and scored yourself some coins.
As for the others, the lenders deeply thank you for coming out to play.
But before you can actually do any margin-trading, you’ll have to define each loan’s specific terms.
Pushing Loans to the Chain
You’ll have to select an initial margin percentage — the minimum margin percentage required for the loan to execute.
And, you’ll choose the maintenance margin percentage — the margin amount that will trigger a loan’s liquidation.
Once your margin parameters are set, select the loan’s duration. Now you’re ready to tick a box before pushing the portal’s biggest blue button of them all.
So long as all loan terms are accurate — the system will warn you with error messages if they’re not — you can digitally sign the order and put it on the blockchain.
Tomorrow — September 6, 2018 — marks a new day of liquidity for the bZx Network. What’s the announcement? Bamboo Relay — built on, you guessed it, the Ox protocol — is set to integrate with bZx.
Currently, the bZx platform has zero liquidity. You can play with the interface and add real tokens. However, there’s nobody to trade with just yet.
But once they get their tokens flowing through the order books of the Bamboo Relay project, bZx will gain an immediate customer base. Look for a big spike in platform engagement once integration is live.
Until then, all other tabs — aside from the ‘Contracts’ tab that connects your Ledger with MEW — are just dead weight.
I’ll admit being intimidated by the thought of writing an article about an unknown Ethereum portal.
While it has the air of a DEX, the bZx platform has the feel of a polished and refined software program.
Other than the need to connect with MEW or MetaMask, you’re not even aware that you’re operating a DApp.
Now that I’ve seen the platform in action, I’m even more excited to HODL tokens with the bZx Network. It’ll be interesting to see how the protocol develops as it establishes a dedicated userbase.
The scope of the project is virtually unlimited — they provide a unique service that any crypto exchange can utilize — and the number of exchanges entering the market continues to grow.
Integration with Bamboo Relay is a massive step forward in the bZx platform’s evolution. The portal is basic for now but any new ecosystem has to begin somewhere.
ICO projects that are this far along with their product are rare these days. They’re often nothing more than a whitepaper filled with buzzwords.
In contrast, the bZx Network is alive and kicking. Their MainNet DApp succeeds in delivering a clean UI that’s very easy to use.
And if you haven’t yet, go ahead and give the bZx platform’s MainNet DApp a try so you can experience its simple elegance for yourself.
Lastly, some additional bZx Project Resources:
MainNet DApp: https://portal.bzx.network
BZRX Token Pre-sale Application: https://b0x.network/tokensale/
By the way…
If you like what you see here and need help getting your crypto message to the masses, I’d love to hear about your project.
Feel free to reach out to me here: blockchainauthor at Gmail
This article was created in exchange for a potential token reward through Bounty0x. *** BountyOx username = blockchainauthor ***