Interoperability Challenges

Decentralized exchanges (DEXs) have attracted much interest in recent years because of their security, transparency, and autonomy when compared to centralized exchanges (CEXs).

Until now interoperability between blockchains has been restricted to bridges, giving significant challenges for the decentralised finance (DeFi) industry, including fraud, different blockchain architectures, consensus mechanisms, programming languages, data formats and the lack of a common standard for cross-chain transactions. These challenges hindered the seamless flow of assets and information across multiple blockchains. Overcoming these obstacles is critical to enable cross-chain transactions and create a unified DeFi experience.

Yet, despite their potential benefits, DEXs confront several obstacles, including regulation, security, and interoperability.

Insufficient liquidity is a significant issue for DEXs where traders competing large pools encounter severe slippage. As a result, these slippages may deter institutional investors and traders from wanting higher liquidity levels.

The ZEUS DEX addresses these challenges by leveraging the L1X interoperability protocol.