- Zeta X wants to improve DEX trading on the Solana network by achieving 10,000 TPS and almost instantaneous confirmations.
- A Solana L2 blockchain is being developed by Zeta Markets to improve DEX performance through quicker trades and greater success rates.
- The suggested L2 solution seeks to match centralized exchange capabilities with 3-5 ms confirmations and 10,000 TPS.
DefiLlama’s data indicates that Solana (SOL) has an 8.7% domination in monthly trading volume for on-chain derivatives as of right now, with $8.3 billion traded so far in August. With $24 million in weekly turnover, Zeta Markets is the third-biggest decentralized exchange for perpetual trading (Perp DEX) in the Solana ecosystem.
The goal of the Zeta project is to create Zeta X, a layer-2 (L2) blockchain built on Solana that is intended to be a Perp DEX. Zeta’s founder, Tristan Frizza, claims that Solana L2 will be able to facilitate quicker trading and a greater transaction success rate.
He continues by saying that L1 Perp DEXes encounter difficulties due to congestion, including higher gas costs, longer confirmation times, and lower transaction success rates.
The third major challenge is providing liquidity, as market makers responsible for doing so face a number of challenges that impede effective quoting, including high gas prices, non-deterministic order placement, and cancellations when, with heavy traffic, transactions take 20 to 30 seconds to confirm.
Frizza asserted that an L2 blockchain is necessary to address these issues.
Metrics provide benefits
The founder of Zeta claims that moving Zeta to an L2 might speed up soft confirmations for transactions, which can occur in three to five milliseconds. He said that this level is comparable to that of controlled exchanges.
Other advantages include nearly zero failed transactions and triggers, even during periods when the Solana mainnet is crowded, a high throughput of 10,000 transactions per second (TPS), and a flawless 1-click user experience without requiring the signing of several transactions and confirmations.
Fragmentation of liquidity
One of the main issues facing the decentralized finance (DeFi) ecosystem at the moment is liquidity fragmentation. Liquidity flows differently as additional L2s are generated, which impacts the trading experience for users.
The community typically applauds Solana for emphasizing application development, since the network’s capacity to handle current user demand is currently sufficient. Therefore, the issue of liquidity fragmentation within its ecosystem may arise from the formation of an L2.
According to him, Zeta’s team intends to develop a high-performance decentralized finance system rather than only an L2 for valuation or total value locked (TVL).
Disclaimer : This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
