Check it out at DSwap!
What's a Hive-Engine
Hive doesn't have native smart contracts, and various projects on the chain need tokens and it doesn't make much sense to do it all through ERC20s or wait indefinately for HMTs (Hive Media Tokens). So, we built a platform. Now, Hive users have the ability to mint fungible and non-fungible tokens using custom Json posted on the Hive blockchain as the layer 1 for the project. The Hive-Engine system interprets custom Json and mints/trades tokens on the layer 2.
What's a DSwap
DSwap is an addition to the Hive-Engine ecosystem that allows for convenient and automated trading. There's two parts: Market Making and Market Taking.
What's a Market Maker?
A market maker is an automated piece of software that places orders on both sides of a trade. It makes money by having a small spread between the bid and ask so as money is sloshing back and forth the person/group running the market maker has the ability to skim a little off the top.
What's a market taker?
A Market Maker places bids and asks, but never pushes into the depth chart. It offers things for trade, but it doesn't take other people's offers. A market taker is when a user or piece of software takes one of the offered trades.
In the case of DSwap, the goal is to provide a convenient tool to swap between different cryptos/tokens. You would enter I have "X" I want "Y" and authorize it with a few configuration details, and all the steps would be handled automatically. And it'll automatically exchange (Swap) for you.
What's rolling out right now?
The Market Maker alpha is ready as of TODAY! So, if you'd like to setup an automated market maker you can do that starting now. There might be bugs, we've tested to the best of our ability, but there could be other inconveniences as well. That's why it's an alpha. We also have many additional features and trading strategies to add, so there's a lot of development work left to do.
Why should I do market make?
You have a chance of making money through automated trades!
How much can it make?
While the earliest data isn't much to go off of, Neal who has been running one using direct commands (rather than the friendly interface we're rolling out) averaged a 37% annualized yield after the first 9 days. Hopefully as we optimize it and more people use the exchange this increases. You'll note on some days he lost money (because the money didn't just slosh evenly but only one side of the pairs were bought). At some points he's actually sold out of half the trading pair. Even with those he's still averaging a 37% annualized return!!!
It's not completely set it and forget it, but I'd argue it's a low effort way to make money if you have money.
What's in this for Hive-Engine?
We just want more volume on the exchange. Yes, we take fees, but also it attracts more projects to build here on Hive because if there's more volume, there's more money, and it's easier to see how one could raise/make money on the platform by doing projects or trading here.
What are the fees?
For the people taking markets there's still the 1% deposit/withdraw fee, and then it's whatever the spread is. If you're trying to move small amounts of money it'll be slightly over 2% in some cases. If you're trying to move large amounts of currency it'll be higher. It's still substantially lower than 10% fees I've seen (and experienced) charged by other prominent swapping tools. We're currently investigating capping the 1% fee for larger exchanges or lowering it for a period of time.
For the people making markets there are no fees on the trade. This is a huge deal because it means that no one is taking a piece on EVERY transaction. The real advantage of the fee system is that the large liquidity providers aren't hit on every trade they make!
The market maker itself does have fees. The one that actually costs something is a 100 BEE (100 ENG when it goes live on steem-engine) which is burnt when registering an account. There is also staking required, it'll be 1000 BEE or more depending on how much you want the market maker to do.
Keep in mind, staking doesn't actually cost you anything. It just means that you're parking money somewhere for a while. So, in our case you have to spend ~$20 to register an account and park ~$200 bucks here for a while (less if you buy the bee on the open market or got in airdrops). I paid $500 for the trading bot that I've used in the past. So, kindly put that in perspective before railing against me for daring to charge for the services we provide.
What's the advantage of this being a smart contract?
Normally everyone has to run their own program. If it requires it's own server you need a computer science 101 background to be able to run tools like this. HOWEVER; that's not how this works. The smart contract is now part of the Hive-Engine node software. You don't have to run your own program, you don't have to be a dev, you don't have to maintain this stuff. It's running as part of the core backend of the project.
So, what you have to do is register the bot and give it some configuration details. We maintain the damn thing.
On the market maker side we're adding more premium strategies. The first one is wall nesting. So, if there's a giant buy or sell wall, you can nest right up against it, which provides some certainty of a backstop for your trade.
The second strategy will be what I call lures, as in fishing lures. In that you'll be able to have one bid/ask pair close to the gap, and a second or third+ pair further back from the gap between the pairs. It's similar to saying "if you want a $10 trade it will cost you X, if you want a $100 trade I'll charge you Y, and if you're looking to trade $1000 right now it'll be Z."
On the market taker side, we're still working on the backend, and hopefully sometime in September this whole apparatus will be working to make and take bids/asks on the exchange.
Overall though, this is a project that basically never has an end. There's a lot more strategies and automated things we can do with the tool now that the core components (configuration tool, execution tool) are out. We could for example get DCA tools running where you say how much of a token you want to buy, how frequently, and how much you want to collect, and it'll sit there and buy it for you over a period of time. We're trying to make your trading automated, inexpensive, and convenient.
Want to give it a try?
I'm willing to do some discounts to get this started. So, for the next week if you get this up and running let me know. Depending on how much liquidity you're willing to provide I'm willing to cover some or all of the costs to you including reimbursing fees for the market maker and fees for moving in Hive/Steem/Crypto.
You can find me in [discord](https://discord.steem-engine.com] as aggroed.
This is patriotic for Hive!
Just lastly, keep in mind that by supporting this project you're supporting the ecosystem as a whole. I like things that elevate the community while simultaneously providing me and the users of the platform with money. This counts for that. As you're trading, increasing volume, it makes building projects on top of Hive-Engine and Hive more attractive. So, do your patriotic Hive duty and start making trades and automated trades today!
https://dswap.trade was initially not setup, I took that link down and replaced with http://dswap.trade, but now it is working and I've restored the links to the https://dswap.trade. Sorry for the inconvenience.