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Cryptocurrency exchanges, just like stock exchanges, are platforms where investors buy and sell digital assets. Crypto exchanges are distinctly split into two types — the first generation centralized exchanges, or CEXs, and the newer decentralized exchanges (DEXs).
CEXs offer ease of use and higher liquidity than their decentralized counterparts. However, CEXs also have a single point of failure and are more prone to regulatory controls as exchanges freeze funds and accounts of investors. While decentralized exchanges have the advantage of offering trustless and permissionless trading, they lag behind CEXs when it comes to liquidity. Even more critical, the blockchains traded have interoperability issues, where trading can only be done with native blockchain assets. Simply put, you can't directly swap ETH for BTC on DEXs such as Uniswap.
Enter THORChain, a unique DEX that allows safe crypto trading between assets across different blockchains. Curious about how THORChain achieves this? Read on, as this article discusses THORChain, what it is, and how it solves the interoperability issues plaguing blockchains — among other benefits.
THORChain is an interoperable cross-chain solution that can seamlessly swap native assets across different blockchains in a decentralized, permissionless and trustless manner. It’s named after the hammer-wielding Norse god of thunder.