Router Book

Unlike the Ecosystem Book, the Router Book cannot guarantee successful on-chain settlement of trades at the time of order placement. This is because although passive orders originate from traders within our Exchange who have funds in our smart contract, taker orders may also originate from traders outside our ecosystem.

The Ecosystem Book gives broader access to liquidity as it allows for more traders against the passive orders. It also allows traders outside of our Exchange to access our order book and therefore provides better prices to the whole market

Trade scenarios

However, as the taker originates from outside our ecosystem, our Exchange cannot guarantee a robust execution semantic. This means:

• If the matching engine yields a trade, it does not necessarily imply successful on-chain settlement because the external taker order might become invalid due to malicious actions by the trader. For example:

  • The trader might not have the necessary funds to execute this trade at the time of settlement

  • The trader may revoke permissions so the Exchange no longer has the right to move the funds

  • Trader can change the semantics of what it means for a signature to be valid

• Consequently, traders placing passive orders in the order book might believe a trade has occurred, but, in reality, no fills will occur at the time of settlement. This means there is a possibility of false-positive fills and the trader cannot use funds received from the trade until the rollup happens on-chain

• Our Exchange will promptly initiate the on-chain execution of associated trades to minimize the possibility of trade failures and ensure swift performance for traders. This is crucial as traders can only utilize the acquired funds after the on-chain settlement.

Note that both the Router and the Exchange perform robust validations of external taker orders, minimising malicious taker activity. Additionally, as the taker cannot perform any atomic arbitrage, there is no strong incentive for them to engage in such behaviour. Because of this, the experience for liquidity providers in the order book is generally the same as in the ecosystem book.

Use of Routers to facilitate transactions

To interact with the Router Book, we allow Routers to plug into our order book and serve as bridges between takers and our Exchange.

The Routers will direct takers' orders to our Exchange and will profile traders to ensure the validity of their orders.

We will provide better fees to incentivize users of our Exchange to trade against the Router Book

Note: takers from the Router Book can also be from the ecosystem side

External Router Takers: Limitations and Features

• Takers can leverage familiar semantics from DEXs and use slippage to specify the maximum amount spent or minimum amount received.

• External taker orders will never be placed into the order book, as we cannot guarantee the validity of those orders at any point in time.