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The DEX is Your Friend Deep Diving Decentralized Exchange 🌐🤿"

The DEX is Your Friend Deep Diving Decentralized Exchange 🌐🤿"

Re:crypto#21 The Alternative For The Ordinary Individual

Jeremy Loo
February 03, 2024

🚀 Welcome back, Crypto Fam, to another edition of Re:crypto! 🌐 In this edition, we'll unravel the mysteries of Decentralized Exchanges or DEX’s, making crypto more accessible for everyone, especially the non-crypto native. Let's dive in! 🤿💹

In previous editions, we delved into Centralized Exchanges, exploring their pros and cons. We even walked you through different wallets, including setting up your very own MetaMask wallet. Now, get ready for the ultimate combo as we fuse them together for a powerful self-custodial 1, 2 punch. 👊💼

But wait, before we immerse ourselves in the crypto realm, let's catch up on the traditional markets' buzz, featuring today's FOMC meeting. The burning question: Will the FED raise or lower rates, and when? The verdict: The FED declared a halt to rate hikes, deeming current conditions restrictive enough to bring inflation down to their 2% target. However, they remain cautious, seeking more evidence of a sustained fall in inflation. March rate cut hopes? Dashed.

Interestingly, social media was abuzz with what the FED left unsaid. The usual affirmations of robust GDP growth and a thriving job market were absent. The statement on the sound and resilient state of the US banking system? Nowhere to be found. Deliberate omission, perhaps? Coincidentally, another bank flirted with collapse today. New York Community Bankcorp's shares plummeted over 35%, signaling instability as the bank slashed dividends and reported an unexpected loss. Maybe not as stable as the FED believes. 🏛️💭📉

Now to today’s lesson:

🌐 Today, we'll delve into the fascinating realm of Decentralized Exchanges, affectionately known as DEX’s! 🚀 Moving forward, we'll stick to the crypto-native term DEX for consistency. But what exactly is a DEX? 🤔

Imagine a scenario: You have a collection of cool trading cards you want to exchange with friends, but there's no overseeing teacher ensuring fairness. That's a bit like how traditional stock exchanges operate, with a middleman taking a small fee for each trade.

Now, picture a massive online playground where everyone can trade their cards directly, no teacher involved. Each participant keeps track of ownership using a special digital record, like a giant shared notebook. That's the fundamental concept of a decentralized exchange (DEX)!

Here's what sets DEX’s apart:

🤝 No Middleman: Direct trading with others, akin to swapping cards on the playground.

📜 Digital Record: Trades are recorded on a special online list, preventing cheating.

🌐 Open to Everyone: Anyone with an internet connection can join the playground.

💰 Money Pools: DEX features various digital money pools, allowing people to trade—similar to sharing boxes of cards for trading.

It's essentially a playground with cool rules:

🔒 Security: Harder for someone to steal your cards due to the watchful shared record.

👁️ Transparency: All trades are visible, ensuring fairness and openness.

🔄 New Options: Trade not just cards but other digital items or even art!

🤖 Governed by Code: Rules overseen by computer software, making cheating very difficult.

Remember, DEXs are a tad more complex than trading cards, but this should give you a basic understanding of how they operate! 🎓✨

🔍 Extra Details:

- A DEX is built on the "blockchain," like Ethereum, serving as a scoreboard for everything, not just coins.

- Your money stays safe in your own "wallet"; no need to deposit it in the DEX for trading.

- DEX differs from a regular centralized exchange; it's not owned by one entity but by everyone using it.

- New coins are added by those who share them, not by the exchange seeking money.

- People can provide coins to the exchange and earn fees in the form of LPs from others using the DEX.

🚀 Now, let's explore how to use a DEX, and for this journey, we'll navigate through the OG DEX, Uniswap. To guide you, let's revisit our trusted friend, CoinGecko! 🦎💼

Scroll down and look for Uniswap

After opening the Uniswap page on CoinGecko find the link for the Uniswap page this is to help prevent you from going to the wrong website. A common tactic of phishing scams is to create websites that look similar but the URL is a little different. Making you think that you are opening the correct page if you were to search it on a search engine like Google. This is to help mitigate this tactic.

You can also go to the Uniswaps Official X page formerly twitter.

Now that you are on the Uniswap website theres going to be a button that says “Launch App” in the upper right hand corner. Click on that.

Now you are on the swap page. What your going to need to do now is connect your wallet. By clicking on the connect button in the upper right hand corner.

When you click on the connect button a list of wallets will open. You can go ahead and select your wallet. In this example we will be selecting MetaMask.

After selecting MetaMask you will be prompted to unlock your wallet. Just punch in your password and hit unlock

After you unlock your wallet you should see your wallet address and what Blockchain Network you are on. For this example we are currently on Ethereum.

You can switch networks, by clicking on the arrow you will open a drop down of different blockchain networks that Uniswap is compatible with. For this example we will switch to Arbitrum.

After you select your network MetaMask will prompt you to switch networks. Click on the switch network button.

Now you can see by the change in the symbol that you are on Arbitrum

Now you can select the coin you want to use to make the swap with and the coin you want to swap to.

When you click on select token you will get a drop down that shows you different coins that you can choose from.

For this example we will use USDC to swap for Ether. We will swap $10 of USDC for what ever amount of ETH we can get for that. Now all thats left for you to do is click on the Approve and Swap button highlighted in green.

Your wallet will prompt you to approve the USDC. Now if you see this large number in the box don’t worry just click on max and it will adjust that number to what you have in your wallet. Then you can make the proper adjustment to what you are going to approve for this transaction.

Once you have the proper amount that you want to approve then click on “Next”

Next you will be prompted to Approve the transaction. You will be charged a small fee for gas. Click on “Approve”

Next you will be prompted to Sign for the transaction. The sign button will be greyed out all you have to do is scroll to the bottom of the area highlighted in red then it will turn blue. Click on “Sign”

Now you will be prompted to confirm the transaction. You will be charged a gas fee to complete the transaction. Click on “Confirm”

Now you will be taken back to Uniswap where you will see all the details of the transaction and a summary of the steps you completed.

After the confirm swap is completed on the review screen. A status screen will pop up and show you the status of your transaction. Here you can see that is was successfull. But if your transaction says pending this can happne because of congestion on the network. But you can click on “View on Explorer” to view in the block explorer.

When you click on “View on Explorer” it will take you to Arbiscan where you can view the status of your transaction. Arbiscan also provides a lot of different details about whats going on on the blockchain. You want to look at status here it says success. But if your transaction isn’t completed yet it will say pending.

Now let’s try a more obscure coin lets go back to CoinGecko and the Top Gainer’s and Losers list. lets go with Conic (CNC) for this example.

After opening the Conic page you want to look for the contract address.

After you locate the address you want to copy the contract address to your clip board by clicking the copy button.

Now back on Uniswap click on select token.

A drop down will open and what your going to want to do is paste the contract address for Conic in the search bar.

After you paste the address in the search bar. The Conic token will appear underneath the search. Click on it to select the Conic token.

After you select Conic you will get a prompt. The prompt just says that the token is not on top US exchanges and to do your own research. There will also have a link to look up the coin on the block explorer. What your going to want to do here is just click on continue

Now Conic (CNC) will appear in the receive block and your good to go. All thats left is to enter the amount you want to swap and go through the process we laid out above with approving and confirming.

One last thing before closing this tutorial out. If you are having issues with a swap failing you may just need to adjust the slippage. You can do that by clicking on the gear and changing the slippage tolerance percentage. Some coins will have a 5% buy and sell tax so you need to adjust the slippage. But don’t go to high or your transaction could get front run by MEV bots. We’ll cover that in a later edition

Absolutely, crypto fam! 🌐💼 Now that you've mastered the ropes of using Uniswap, the exciting part is that most DEX-type exchanges operate quite similarly. Take SushiSwap, for instance—it's essentially a clone of Uniswap, and PancakeSwap on Binance Smart Chain follows a comparable approach. 🍣🥞

Armed with this knowledge, you're well-equipped with the essential tools to navigate the thrilling realm of decentralization! 🚀🛠️ Feel free to explore other DEX platforms and unleash the full potential of decentralized trading. Happy trading and may your crypto journey be filled with success! 🌟💱

The Markets:

A mixed bag this week as the Crypto Bubbles show some big gainers mixed with some losers.

🌐💰 Crypto Market Update! 💹📊

As of today, the global cryptocurrency market cap stands strong at $1.74 Trillion, showcasing a resilient 0.7% change in the last 24 hours. 🌎💹

In the dynamic realm of crypto trading, the total cryptocurrency trading volume over the past day has reached an impressive $52.5 Billion! 🚀📈

🔝 Dominance Check!

- Bitcoin asserts its dominance at 48.7%, leading the crypto pack.

- Ethereum follows closely with a dominance of 16.1%, contributing significantly to the market.

📈 Top Performers!

The current stars in the crypto galaxy are none other than Decentralized Exchange (DEX) and Oracle cryptocurrencies, experiencing substantial gains. 🌌📈

Top 10 Cryptocurrency by market cap on CoinGecko

Top Gainers & Top Losers

📰🚀 Crypto Headlines Roundup! 🚀📰

Crypto Scandals Unveiled!

1. 🕵️‍♂️ Crypto Teacher's Shocking Scandal!

- A crypto educator loses students' $1.2M investment in a fake hedge fund. 😱💸