Settlement on Tacen Exchange

Project TXA Decentralized Settlement Layer: An Introduction

Project TXA's Decentralized Settlement Layer is changing the way settlement is done. Born out of the recognition that nearly the entirety of the crypto traders are unnecessarily exposed to the security risks of centralized exchanges and the performance failures of decentralized exchanges, the DSL marks a step forward in the way assets are settled.

The beauty of the Hybrid Decentralized Exchange model lies in the way settlement is done. The goal is simple: centralized orderbook with decentralized settlement. Traders submit their orders to tacen's centralized orderbook and those orders get matched. When a trader is ready to withdraw and settle their trades, the DSL is able to handle the reporting and writing of obligations without ever needing to actually handle trader assets, thus preserving the privacy of the trader.

Project TXA's Decentralized Settlement Layer serves as a hub for quorums of Settlement Data Providers to reach a consensus on P2P obligations to finalize settlement. Traders request settlement on a per-chain basis, SDPs calculate and report the obligations owed to each party, obligations are written, and traders request the funds wed to them in a P2P fashion. Currently, there is one Settlement Data Provider servicing Tacen Exchange during our Open Beta, with more to follow in the coming months

SDP operators charge a settlement fee for their services per trade, which leads to the further democratization of the exchange process. Put simply, an SDO serves as a type of node in the Decentralized Settlement Layer that receives trading data, supports the process of trade settlement, and protects the decentralized nature of settling trades. The combination of the two, centralized orderbook and decentralized settlement, allow for a CEX experience in terms of performance with a DEX experience in terms of privacy.

Requesting Settlement on Tacen Exchange

When users have collateralized their funds in an ACC, those funds are considered available to trade. Wherever asset balances are shown, funds that are available to trade can be found in two columns: 'Available to Trade' and 'In order.'

When users want to withdraw their funds back to their wallet, they must be decollateralized and made unavailable to trade. This is done by unlocking those assets. This can be done by clicking the button 'Unlock' next to the available to trade balance of an asset. Doing so will do two things: it will decollateralize their assets to be able to withdraw and it will cancel all open orders that include that asset.

Effectively, what users are doing by clicking 'Unlock' is requesting settlement to the DSL. When a user clicks 'Unlock' a quorum of SDPs read the obligations owed on the trades made involving the specific asset and obligations are then written. Once obligations are reported and written by the quorum, the user is able to withdraw the asset.

As a result, all funds in the statuses 'Available to Trade' and 'In Order' will be moved to the status 'Available to Withdraw.'

Withdrawal From Trader Asset Custody Contracts

Please note that funds can only be withdrawn AFTER they have been unlocked. Assets that have not been unlocked have not been settled on the DSL and must do so before being available to withdraw.

Once assets are available to withdraw, users click 'Withdraw' from a number of places in the exchange. They will then be presented with a traditional withdrawal modal in which they will determine the asset to be withdrawn and the amount that is to be withdrawn. Once the request for withdrawal has been submitted, users are served a toast notification in the top right of the screen notifying them that their withdrawal is underway. They will receive a second notification confirming the success of the withdrawal.