“In the next three to five years, the DeFi sector will grow tremendously,” says 1inch Network co-founder Anton Bukov

It has only been two years since its found­ing, But the 1inch Net­work decen­tral­ized exchange (DEX) pro­to­col has already sur­passed $ 85.8 bil­lion in life­time trad­ing vol­ume. At a May 2019 hackathon in New York City, the co-founders of 1inch, Anton Bukov and Sergej Kunz, they devel­oped a pro­to­type DEX aggre­ga­tor that became the basis of the net­work. DEX aggre­ga­tors are plat­forms that derive liq­uid­i­ty from mul­ti­ple DEXs, thus pro­vid­ing bet­ter token exchange rates with the low­est pos­si­ble slippage.

The net­work has a mar­ket share of 57.40% in the DEX aggre­ga­tor sec­tor and more than 820,000 users. Accord­ing to data from Coin­Mar­ket­Cap, 1inch Exchange is the eighth largest DEX in the world, with a trad­ing vol­ume of USD 277 mil­lion in the last 24 hours.

On Mon­day, Bukov joined the Coin­tele­graph Mar­kets Pro com­mu­ni­ty for an exclu­sive “ask me what you want” ses­sion via Discord.

Coin­tele­graph Mar­kets Pro: Do you think DEXs will serve the major­i­ty of cryp­tocur­ren­cy users, or will that seg­ment be dom­i­nat­ed by algo­rithms and trad­ing bots?

Anton Bukov: I think that in the next three to five years, the DeFi indus­try will grow tremen­dous­ly. It is already grow­ing rapid­ly, but the ben­e­fits of peer-to-peer tech­nolo­gies can and will be more wide­ly experienced.

Of course, for the DEX to dom­i­nate over the CEX [exchanges cen­tral­iza­dos], cer­tain con­di­tions must be met in the future. DEX and blockchain pro­to­cols have to work 100 times faster than now. Users have to under­stand the core con­cept of the tech­nol­o­gy. User tours have to be short­ened and eas­i­er for beginners.

1inch Net­work is a col­lec­tion of robust and com­pos­able DeFi instru­ments, which togeth­er enable both vet­er­an and new DeFi users to max­i­mize the finan­cial oppor­tu­ni­ty of Web 3.0 with a clean user expe­ri­ence and secure contracts.

CT Mar­kets Pro: What makes 1inch stand out from the crowd?

AB: AB: 1inch’s mis­sion is to ben­e­fit the entire DeFi space. And we work hard and fast to accom­plish that mis­sion. Our goal is to unite traders and liq­uid­i­ty providers, facil­i­tat­ing trans­ac­tions that are prof­itable for both par­ties. The main func­tion­al­i­ty of 1inch is to aggre­gate data from var­i­ous decen­tral­ized exchanges and com­bine the best prices of all offers with the nec­es­sary liq­uid­i­ty. In April 2021, we launched the 1inch wal­let for iOS, a mul­ti-chain mobile plat­form that pro­vides an easy-to-use inter­face with secure stor­age, trans­ac­tion and stak­ing capa­bil­i­ties. This ver­sa­tile wal­let was devel­oped from the ground up to stream­line inter­ac­tion with 1inch features.

CT Mar­kets Pro User: As a DEX aggre­ga­tor, is there a plan to mit­i­gate the amount of com­mis­sions cur­rent­ly on the entire net­work? What are the plans for the future at 1inch?

AB: Of course, the 1inch Foun­da­tion recent­ly estab­lished a gas expense reim­burse­ment pro­gram for 1inch users.

AB: High prof­its are often accom­pa­nied by high risks. Users deposit more coins; This low­ers your earnings.

CT Mar­kets Pro: Binance has a large 1INCH stake, which accounts for 44% of gov­er­nance votes. How does 1inch intend to over­come this situation?

AB: Binance is stak­ing on behalf of its users; Binance nev­er vot­ed and will not vote, as far as I know.

CT Mar­kets Pro: : How does 1inch solve the bot problem?

AB: The 1inch Liq­uid­i­ty Pro­to­col has a unique fea­ture that helps pro­tect users from these types of attacks, ensur­ing that users get the most out of every trade. To deter those who prof­it from these types of attacks, the 1inch Liq­uid­i­ty Pro­to­col has “vir­tu­al fees” Actu­al­ly; you can refer to this arti­cle for more details.

CT Mar­kets Pro: How dif­fi­cult will it be to migrate from 1inch to Eth2? Will each liq­uid­i­ty provider be required to trans­fer its position?

AB: No DeFi devel­op­er should expect or pre­pare for ETH 2.0. DeFi scal­ing will occur through Lay­er 2; ETH 2.0’s frag­ment­ed envi­ron­ment doesn’t make sense for DeFi.

I con­sid­er ZK Rollups to be a real scal­ing solu­tion because the com­plex­i­ty of the ver­i­fi­ca­tion of ZK trans­ac­tions is fixed and does not depend on the com­plex­i­ty of the trans­ac­tion itself. It seems like mag­ic, but it is like that ^^.

CT Mar­kets Pro User: Is there a plan for mul­ti-chain oper­a­tions / trans­ac­tions? Bridges, etc.

AB: I recent­ly post­ed an inter­est­ing thread on Twit­ter about the future of 1inch cross-chain; please check it out:

1 / In recent months, I’ve been asked a lot about a cross-chain future for @ 1inch. Dozens of projects are active­ly work­ing on bridges, and some of them have applied for 1inch grants or just asked for my advice / opin­ion. This thread reveals my thoughts on the sub­ject. https://t.co/25Rgy5cYok

– Anton Bukov âš – ï¸ ?? (@ k06a) Octo­ber 25, 2021

1 / In the last few months, I have been asked a lot about the future on-chain of 1inch. Dozens of projects are active­ly work­ing on the bridges, and some of them have applied for 1inch grants or sim­ply asked for my advice or opin­ion. This thread reveals my thoughts on the subject.

CT Mar­kets Pro User: What do you think of Uniswap v3?

AB: They dra­mat­i­cal­ly increase the cap­i­tal effi­cien­cy of their pools. It is the ulti­mate solu­tion for LPs (liq­uid­i­ty providers). But I see that traders have real­ly bad exchange rates and huge slip­pages on Uniswap. I’m going to do a Dune­An­a­lyt­ics pan­el on this. Using aggre­ga­tors should be a no-brain­er for every­one because 1inch inte­grat­ed over 80 sources into the Ethereum main­net alone.

CT Mar­kets Pro User: Apart from 1inch, are you involved in oth­er projects?

AB: I only advise or con­sult on some projects. But I work full time on the next big thing in 1inch.

CT Mar­kets Pro User: Cre­at­ing a DEX aggre­ga­tor seems incred­i­bly com­plex. Do you use a sin­gle ora­cle as a price source, or is there anoth­er way to cal­cu­late prices?

AB: We have our own off-chain ora­cle to get chain prices.

CT Mar­kets Pro User: How has the explo­sion in gas rates affect­ed 1inch trading?

AB: You can set up a new phrase or just enter your wal­let address to test it in read-only mode. Since it is a wal­let, you sim­ply can­not cre­ate trans­ac­tions and pro­duce sig­na­tures with­out a pri­vate key / seed phrase.

CT Mar­kets Pro User: How are you work­ing with lay­er two solu­tions to make 1inch prac­ti­cal for small­er trans­ac­tions? Do you have any favorite tech­nol­o­gy? Sidechain, Opti­mistic, rollup, ZK rollup, some­thing else I’ve nev­er heard of?

AB: Per­son­al­ly I pre­fer the ZK rollups, wait­ing for ZKSync 2.0 from Mat­ter Labs. But sure 1inch will sup­port or pop­u­lar / top 2 lay­er / sidechain solu­tions that have: users / tokens / DEX / activity.

CT Mar­kets Pro User: With hard­ware, there are cur­rent­ly some solu­tions to con­nect to DEX by con­nect­ing Meta­mask to hard­ware and then to DEX. Do you think we can get a direct con­nec­tion to the hard­ware with­out any middleware?

AB: You can use a hard­ware wal­let through the Wal­let­Con­nect pro­to­col, even on a mobile phone using the Ledger Live app. Take a look at our cool open source dashboard.

CT Mar­kets Pro: What are some of the recent cool inno­va­tions or devel­op­ments around the 1inch Network?

AB: We are work­ing hard to offer one more pro­to­col soon, also build­ing a 1inch ver­sion for insti­tu­tions: 1inch Pro.

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