The 0x Protocol enables liquidity across different currencies in a decentralized manner. Although this project has been around for a while now, its developers are always looking for ways to improve upon the existing technology. The newly announced 0x Protocol V2 will introduce a few interesting changes as evolution is always a necessity in the cryptocurrency blockchain world.
#4 Permissioned Liquidity Pools
The concept of a permissioned liquidity pool has been around for some time now. It allows a way for institutional traders to perform large peer-to-peer trades of digital assets in a compliant manner. The first project to provide such functionality will have a first-mover advantage. It now seems the updated 0x Protocol will focus some of its attention on tapping into this particular market over the coming months. That is a positive development, and it will require the use of “filter contracts”.
#3 Forwarding Contracts
In the financial world, forward contracts will play a big role of importance if blockchain ever gains mainstream traction. The goal of a forwarding contract is to let someone deposit funds and have all of the funds sent to a main wallet. These contracts can also detect incoming payments to the contract and can be set up in such a way funds is transferred automatically at set intervals. Introducing this functionality as part of the upgraded 0x Protocol is rather interesting to keep an eye on.
#2 More Efficiency
Any liquidity protocol needs to be efficient at all times. Improving upon the existing infrastructure can be quite difficult, although the 0x team is effectively making strides in this department. The upgraded protocol will introduce more efficient order matching, which is an integral part of ensuring peer-to-peer transfers of value are taking place without unnecessary friction.
Additionally, the new 0x Protocol will ensure cross-relayer arbitrage will become more efficient in the process. That is all traders and enthusiasts can ask for, especially because arbitrage opportunities can lead to big profits- or losses – whenever the opportunities arise. The 0x protocol is beefing up its compatibility in this regard, which may introduce some big changes moving forward.
#1 ERC-721 Support
In the world of Ethereum, token standards are playing a big role of importance. Albeit most people are familiar with ERC-20, a fair few new proposals have come to market to enhance Ethereum-based tokens as a whole. The ERC-721 standard stands out in this regard, as it is the most popular token standard following ERC20 as of right now.
When the upcoming 0x Protocol launches, it will support ERC-721 at launch. Support for other token standards will be integrated accordingly, although no details have been announced in this regard as of yet. The team is also introducing a new smart contract architecture, which will make it a lot easier to provide and explore liquidity options in the world of cryptocurrency.