DEX223, focused on implementing the ERC-223 standard, has announced the launch of the block producer proxy4dex223 for the EOS blockchain. Users can stake & vote for proxy4dex223 and earn an APY of up to 34.5%.
By becoming an EOS block producer, DEX223 is taking a step toward scaling and diversification, moving beyond traditional trading applications.
What Are Scaling and Diversification?
Every business is a system of input and output variables: product; user base; operating costs; profit; taxation; regulatory rules, and much more. Balance is critical for any system, but one variable stands out as the most important—the user base. All other elements of the system are built around the current and potential users of the product. Therefore, in a business context, the primary goal of scaling is to increase the user base of a product.
Diversification involves shifting from narrow specialization to a broader range of goods or industries. Diversification inherently leads to an expansion of the user base by introducing new products within a specific field or entering previously unrelated business areas. Thus, diversification also aims to scale the business while enhancing stability and resilience across the entire system.
Both CEX and DEX are systems built around and for users and share a pressing need for scaling. However, new market trends and the cyclical nature of markets demand not only an expansion of the user base but also diversification into various areas that make businesses more resilient and stable amidst market fluctuations.
Current Scaling and Diversification in the Market
Despite the DeFi trend and the innovations it has brought to the sector, CEX remains more successful at attracting and retaining users. This is because CEX continues to serve as fiat gateways for users and runs "earn" programs while quickly adopting liquidity farming, a hallmark of the DeFi sector. DeFi, on the other hand, provides uncensored access with the principle of “your finances are managed solely by you.” However, all of this still falls within the scope of cryptocurrency trading businesses. Exchanges compete for users through fee structures, the range of trading pairs, liquidity of trading operations, regional presence, as well as initiatives such as trading competitions and airdrops of newly listed products. Thus, they share the same user base, which grows only as the adoption of cryptocurrencies expands among the general public, without actively pushing into new markets.
A prime example of diversification in the cryptocurrency space is Tether. The issuer of $USDT, Tether Ltd, affiliated with Bitfinex, recently participated in a commodity market deal involving oil. Thus, iFinex Inc's business not only encompasses a major CEX exchange and the top stablecoin but also extends into commodity markets.
DEX223 is now embarking on building a diversified business model with multiple scaling directions. DEX223 is setting trends not only for the adoption of new security standards but also for more robust business models.
Future Prospects
Currently, EOS block production and DEX223’s main trading functions are not interconnected. However, the team is exploring various integration scenarios to provide $D223 holders with benefits from the new DEX223 business direction. It is important to understand that integrating any new functionality requires balancing incentives and stability.