The Decentralized Order Book (DOB) Project

Background

The current crypto trading ecosystem is fragmented, with both centralized (CeFi) and decentralized (DeFi) platforms presenting inherent limitations.

Beyond individual constraints – such as custodial risks in CeFi or liquidity and UX challenges in DeFi – the lack of interoperability between these two spheres, and even within the DeFi landscape itself, significantly hinders seamless asset movement and unified user experience across the broader digital asset economy.

Decentralized exchanges

  • Lack of liquidity / inefficient liquidity aggregation.
  • Low transaction frequency.
  • Limited blockchain interoperability.

  • Impermanent Loss.

Centralized exchanges

  • Assets are under custody at the exchange.
  • Significant costs to take out assets.
  • Bigger transaction costs.

At the Crossroads of DeFi and Cefi

Bridging the gaps

The Decentralized Order Book (DOB) project is at the crossroads of current CEX and DEX: the concept is to replicate centralized Market Making principles on the blockchain, using Decentralized Market Making Pools and layer 2 services, to build a hybrid type of exchange:

The Decentralized Order Book (DOB) developed by Asagaia addresses the critical limitations of both CeFi and DeFi by enabling high-frequency (HF) trading capabilities in a fully decentralized environment. The implementation is built around three key innovations:

  1. Dynamic Order Book Modeling – Each potential routing path established by liquidity providers is individually modeled, allowing for precise pricing and execution strategies.
  2. Unified Liquidity Aggregation – The DOB consolidates liquidity from all Decentralized Market Making Protocols (DMMPs) into a single, real-time order book per trading pair, ensuring efficient price discovery and minimal slippage.
  3. Optimized Order Execution – Orders are executed against the most favorable DMMP configurations, with continuous updates to reflect market changes

While the system may not entirely eliminate impermanent loss (IL), it substantially mitigates its impact by enhancing liquidity and improving trade execution. This is achieved through

  • Real-time price updates and dynamic elasticity parameters that respond to market activity
  • The ability to adjust DMMP settings on the fly
  • The integration of One-XMM pools, which optimize capital efficiency and liquidity provisioning