Timothea Horwell | October 6 2020
Timothea Horwell | October 6 2020
- The technology underpinning Orion Protocol
- Progress on Orion Terminal’s development
- Updates on development across the protocol
Timothea: Hey Simon! It’s great to have you in here, I know you’re often around to help with tech related queries but I’m sure the community are looking forward to having their questions answered in more detail. Can you please introduce yourself to the community?
Simon: Hey! My name is Simon and I’m the Lead Tech Developer of Orion Protocol. A professional software developer, ambassador and blockchain fanatic, I’ve been in the space since 2016, with years of experience in planning and developing complex software projects. I started voluntarily, helping several crypto startups with management, advisory, and dev work - and quickly made it my profession. At one of these startups I met Kal, who later contacted me and asked me to join the Orion team. I immediately saw the potential and wanted to be part of this journey! Since then, I’ve been working closely with the team to build the protocol and our respective products.
Timothea: With Orion Terminal’s Main Net scheduled for this quarter, we’ll be diving into the tech underpinning the terminal. But first, for any newcomers, can you tell us what Orion Terminal is, and what it serves to do?
Simon: Built on the most advanced liquidity aggregator ever developed, Orion Protocol exists to solve some of the largest problems in DeFi by aggregating the liquidity of the entire crypto market into one decentralized platform – pulling from every major centralized exchange, decentralized exchange, and swapping pool.
This underpins each industry-critical solution built on the protocol, including the flagship product Orion Terminal: the singular and non-custodial gateway to crypto. Orion Terminal is a solution that provides traders with what they need: allowing them to tap into the liquidity and markets of every crypto exchange directly from their private wallets - without any third-party risk.
Timothea: Let’s get into the technology that makes all of this possible. What are the key parts of technology underpinning the terminal?
Simon: Making all of this possible are a number of key technologies, many of which have been developed by us and totally unique to Orion Protocol:
Timothea: Let’s start with the Liquidity Aggregator Protocol at our core. As we’ve said, it’s the most advanced liquidity aggregator in the market - can you explain to the community what this means and how this works?
Simon: The liquidity aggregator protocol at our core standardizes connectivity to both centralized and decentralized exchanges, allowing all parties to participate in a trading workflow in a completely decentralized way. The protocol governs accounting and trade settlement that can be implemented on almost any public and enterprise blockchain. This means:
Timothea: Governing the protocol is our proprietary governance mechanism, Delegated Proof of Broker (DPoB). With the recent release of our Orion Broker Software, I’m sure many are curious as to how DPoB, and our Decentralized Brokerage, work. Can you explain this in more detail?
Simon: Delegated Proof of Broker (DPoB) governs every function on the protocol, from order execution, to clearing, to the governance of choosing a broker, and everything in between including via a decentralized brokerage with the native ORN token at its core. Designed using advantages from PoS, DPoB consists of two core components: Brokers and Non-Broker Stakers.
Every transaction across the protocol acts as a trade being carried out by a broker via the decentralized exchange. Brokers earn rewards for conducting these trades: profit share from each transaction will be shared back in the form of ORN tokens.
Brokers with exchange accounts run Orion Broker Software, automatically executing trades routed from Orion's liquidity aggregator. These Brokers are chosen to execute trades based on how much ORN, Orion’s native token, they stake.
Non-Broker Stakers stake ORN to ‘vote’ for their choice of Broker based on the variable reward share offered. This means Brokers are incentivized to offer attractive rates to Non-Broker Stakers to grow their stake, increasing their chance of being chosen.
The staked ORN is used as collateral for possible price volatility, until the broker withdraws all necessary funds from exchanges to cover all open positions. The collateralization factor will differ depending on the liquidity of the additional assets/trading pair - for the most liquid pairs, Orion will use a collateralization factor of ~0.75 (similar to Compound). The 75% of ORN needs to be staked, while the additional assets will be held in exchange accounts.
Timothea: We have an incredibly exciting integration we’re announcing tomorrow regarding full collateralization of our decentralized brokerage, stay tuned!
We’ve also had a number of enquiries on how to become a broker, so a reminder to the community that you can apply here and we’ll touch on more details shortly.
For now, let’s move on to the Order Matching Engine. Can you explain to the community what this is and how it works?
Simon: The high-performance Orion Matching Engine is built on the aggregated orderbook, updated from every connected exchange in real time. This fulfills splitting, routing and matching functions. The task of the order-matching engine is to ensure that trades are executed at the most advantageous price, by accessing the lowest asks and highest bids across all available exchanges.
When a new order is received, the engine first tries to execute it on the internal orderbook. If this does not give the best price, it then uses data provided by the Price Discovery Module to find the exchange or exchanges to which the order should be sent, depending on the required amount and the depth profile of each exchange. Based on the results of this analysis, the order is split up and submitted to the relevant exchanges. In order to fill a large order, or an order for a less-popular pair, the trade will typically be split into small pieces across a number of different exchanges. In other circumstances, one exchange might offer the best price for the amount required.
Following a successful execution, these trades are consolidated and the client is notified of the completion of the order. Orders can have one of the following statuses: new, accepted, filled, partially filled, cancelled partially cancelled. The trading interface also supports different order modes, including fill or kill, market, and limit orders.
A “smart search” is used to discover the right exchanges for the order – that is, the ones with the right combination of price and liquidity. When the Order Matching Engine splits the initial order and finds the best exchanges on which to execute them, the final step is to find exchange executors that eventually create, submit, and watch for filling of the native orders. The Orion Protocol unifies the process for working with both centralized and decentralized exchanges, leaving all the differences to be dealt with only by the specific executors.
Timothea: How will the process of order matching differ across centralized vs decentralized exchanges?
Simon: In short, CEX executors work with API keys, whereas DEX and swap pool executors sign orders right from the multi-currency wallet using a private key.
CEX: The centralized exchange executor is simply an adapter for a particular exchange that can send Buy or Sell limit orders using the provided API key, and monitor them for fulfillment.
DEX + Swap Pools: A decentralized exchange module is designed to connect to a DEX/swap pool in the same way that the order-matching engine connects to a centralized exchange. The exchange executor for a DEX uses a private key provided by a multi-currency wallet to generate, sign, and validate transactions tailored for the DEX on different blockchains. Because the transactions are signed before sending, the private key does not need to be exposed to the web. Nevertheless, security for this operation is paramount.
Timothea: Thanks Simon. Let’s move on to how Orion’s smart contracts work.
Simon: Orion's innovative mutual credit accounting system, implemented in different programming languages (including Solidity, Rust, etc) was specifically developed to be used in smart contracts on different platforms. This underpins Orion's blockchain-agnostic approach to exchange functionality that can be run on different blockchains. The Orion Protocol broker network, which governs the interaction between end-users, brokers providing access to liquidity, and the Decentralized Brokerage, will be deployed as Elrond Smart Contracts.
Before execution, orders are stored privately in Orion’s Matching Engine. Only if the order is filled by a selected broker, will the transfer of assets occur atomically within the Elrond smart contract. As a result, brokers never get access to traders’ accounts or funds as the smart contracts enforce secure conditions of the token exchange.
Only if the order is filled by a selected broker will the transfer of assets occur atomically within the Elrond smart contract: the trader gives the sold asset in exchange for the bought asset. The exact amounts of exchanged assets are strongly enforced by the conditions specified in the order and cannot be altered by the broker. Only when the order is fully settled by a broker is the transaction submitted to the blockchain, so nobody can submit an order before others.
Timothea: A question that has come up a number of times is how our multi-currency wallet will work. Can you explain in more detail?
Simon: Orion wallet can be integrated into all familiar and widely-used wallets (including MetaMask, email/phone-based login, etc.) and allows users to securely store their funds. This isn't limited to native ERC20 tokens, but includes synthetic tokens pegged 1:1 to native currencies on heterogeneous blockchains. This is implemented via Orion Token Bridge system built between different blockchains, including but not limited to Bitcoin and Bitcoin-like blockchains (BCH, BSV, LTC etc), Ethereum, ETC, EOS, NEO, Waves and others.
Timothea: Let’s go into more detail on the Orion Token Bridge.
Simon: As we will be building on the Elrond blockchain, we’ve built a Token Bridge ecosystem for Elrond between different blockchains. The partnership will further develop additional tools to support our joint vision, such as Metamask integration and an Ethereum bridge, and open-source tools that will be reusable by any future integrations, with the Elrond blockchain.
Users will be able to utilize Elrond's high performance for trading, staking assets, and fast cross-chain transferring. The token bridge will include BTC, BCH, LTC, ETH, ETC, NEO, WAVES, etc. Users can securely store their ETC, BTC, LTC, BNB, USDT/USDC and other major currencies right in their Elrond crypto wallet with instant exchange functionality of the entire crypto market. Simply store, trade, and stake.
Timothea: How will token wrapping work?
Simon: Following the success of wBTC and renBTC, we have built oBTC in order to facilitate cross-chain trading on Orion Terminal. Our cross-chain trading is performed via proxy tokens issued on the master blockchains (Ethereum and Elrond) - these proxy tokens are pegged 1:1 to the native currencies and swapped to native tokens via token bridges via atomic swaps, in a trustless and decentralized way.
Timothea: Can you go into more detail on the atomic swaps?
Simon: Where orders are executed internally, e.g. on Orion’s internal DEX, atomic swaps can be used. These employ Hashed Timelock Contracts (HTLC) to exchange pre-determined amounts of cryptocurrency in their entirety (hence “atomic”), or not at all. In the case of atomic swaps, both parties must confirm the receipt of funds within a certain time frame using a cryptographic hash function. If one of the parties involved does not confirm the transaction within the time frame, the entire transaction becomes invalid and the funds are not exchanged.
Timothea: Thanks Simon! Before we move on to the community questions, can you give us an update on the progress of the terminal? Any particularly exciting new developments to share with the community?
Simon: The third phase of the terminal is now live, with a key focus on UI overhaul and a prioritization on mobile support. You can apply to beta test the Terminal here.
Meanwhile, team is making progress integrating the Elrond blockchain:
A number of additional updates will be taking place:
As some of the OrionTraders group will have seen, the next version of the trading terminal will include a swap function. We are currently in the final testing phase and expect to deploy the latest version for the community soon. We have also made some changes to the layout and fixed a number of bugs reported by the community. At this point I would like to thank you again for all the feedback we’ve received!
Timothea: Let’s move on to the community questions we received on Twitter. For this AMA, we’ve selected questions that focus on the technical and development aspects of the protocol. Areas like marketing, partnerships, and tokenomics will be covered in more detail in subsequent AMAs.
@diamondsvietnam: Regarding technology (e.g. Orion Widget, Orion Enterprise, Orion Dex Kit, etc), how far are Orion in them at the moment? What is the main focus of Orion Protocol in terms of technology at the moment?
We are on schedule and will deploy the trading terminal in Q4 on Mainnet. Other products are in development such as the Orion Enterprise Trade Widget which is already in the first test phase. Our current focus is on the trading terminal and broker software.
@molestika: What mechanism does #Orion use to aggregate all the liquidity from the major exchanges into one order book and achieve the best possible price?
Orion uses the websocket technology to get real-time access to orders from the major exchanges. Order book aggregates orders by price level and sortes them from the best to worst price. Orion analyzes not only the current price levels on the exchanges, but also orderbook depth and available funds that brokers bring to the Orion platform from all connected exchanges. All this is done by high-performance matcher servers built using reactive programming principles in concurrent data streams processing and the propagation of changes. Orion’s team constantly strives to minimize the added latency to the order execution workflow making it an efficient gateway to all connected exchanges compared to the direct connection to the exchange via their native API, but with all benefits delivered by Orion.
@nhi35022657: Slow transaction speed is a growing problem for industry and platforms. What has Orion done to improve transaction speed?
We are actively working on an implementation of the Elrond Blockchain which will enable us to speed up the order settlement significantly. Elrond has been able to achieve up to 263k tps according to previous tests. Furthermore, we have recently entered into a partnership with Aleph.im, who offer a layer-2 scaling solution for various blockchains.
@bitstreetsheep: How can I make a transaction by connecting one wallet (MetaMask) and then buy/receive a coin that MetaMask doesn’t support (different blockchain)?
Coins/tokens of other blockchains like Bitcoin are wrapped as Token on the Ethereum blockchain. So every token/coin will be available in MetaMask. But we are working on connecting other blockchains to offer as many native coins as possible.
@diamondsvietnam: To use orion protocol I just need to connect my wallet, which wallets are available to be connected? We use wallets to keep our funds more secure, how are our funds secured once it is connected to orion protocol?
Currently MetaMask, Coinbase and Fortmatic can be connected. But we are already working on extending the choices, e.g. with the help of walletconnect.org which allows us to use a whole range of Mobile Wallets. The funds in the wallet are secure because we only have access to them if the user confirms it by transaction, the same applies to funds in the Orion smart contract. There is absolutely no risk for traders’ funds independently of the volume because no third parties can access funds - trading occurs via your securely connected wallet.
@isyan_tanrisi: I have only one question. Can I use my Ledger with the terminal? This is what the world needs
Yes this is already possible in the current version of Orion Terminal. At the moment only via import into MetaMask, but in the future it will be possible to connect the ledger without MetaMask.
@alluzold: If we talk about security, then how secure Orion Terminal is for securing Copyright Ownership? Also, is all of my Details kept private when I apply online in Orion Terminal?
Yes, all information will be kept private and will not be passed on to third parties. A user of Orion Terminal does not have to worry about entering his private key on our site. Of course, there are a number of other ways to connect your wallet. Anyone can verify the integrity of the Orion Terminal on Github and ensure that the data is kept confidential.
Additionally, leading blockchain security firm CertiK will continue to audit smart contracts and core modules on our platform - all open-source software running on brokers’ local computers will be audited. Meanwhile, every project built on Orion will be referred to CertiK for security auditing, improving the entire ecosystem.
Feedback from Certik is given regularly with a full audit, with public report being released after our public main net goes live. It's an ongoing partnership to ensure the safety of our traders. As technology advances, sadly it also helps malicious actors, we want to be sure to mitigate any and all risk as they may come at us.
@goblogwin: Does every exchange have to sign up as a broker like BITMAX to be featured on your TERMINAL for trading? Would exchanges have the ability to veto ORN’s broker software?
No, an exchange does not have to register with us. Our broker software is already connected to various exchanges, so exchanges/companies or individuals can easily provide liquidity for the protocol.
The decentralized nature of our brokers make it impossible to shut down our access to exchange APIs, exchanges are unable to know which brokers are providing liquidity. It's mutually beneficial, though: rather than taking users away from their exchanges, we’re providing another point of access to their liquidity, allowing users to trade across exchanges they don’t even have accounts with.
Exchanges can see the value in this in a number of ways, and want to capitalize on this themselves. Instead of another broker monetizing their liquidity on Orion, they themselves will earn broker rewards via Orion Terminal and all other DeFi products built on the protocol, as seen through our number of partnerships with major exchanges, OTC desks, and market-makers.
@XaiArashi: Can an order be partially filled by one broker and completed by another? How much liquidity would be required per exchange for a broker to be competitive against a power broker?
Yes, this is already possible. Some of our beta testers have already noticed that an order is split between several exchanges. These can be executed by different brokers.
Currently, the entry amount of ORN staked to become a broker is $10k. The reason we introduced Non-Broker Stakers was to allow for smaller brokers to compete with power brokers in order to grow their stake, increasing their chance of being chosen. Our Private Main Net will give us more robust data on average rates of return, which we will share in due course.
@darwin8534580: I understand that to be a broker you have to "lock up" your orn tokens...is there like a "unlocking period" for them if they choose to not be brokers and sell their tokens?
Yes, there will be a redemption period - to be able to unlock ORN brokers first need to close all their outstanding open positions. Currently, it’s 24 hours, but we could look to reduce this in the future.
@Pr0Bitcoin: How does the arbitraging feature work?
Since the protocol searches for the best price across many different exchanges, it’s often the case that the minimum ask price on one exchange will be higher than the maximum bid price on another.
Our platform provides uniform API access to every exchange and required liquidity at the time. Additionally, more sophisticated products can be built and run on the protocol for the end users. We’re making such trades available for premium users, based on their ORN token holdings. Premium users will receive signals about arbitrage opportunities, which will be sent automatically across different channels (email, browser notifications, eventually push notifications for mobile). We’ll then execute these trades on their behalf if they indicate their interest.
@ikingamino7: How does ORION facilitate the cooperation and collaborative development within the community. If someone had an idea that would work well on ORION , how can we get support?
Just get in touch with us! We are happy to support the community as much as we can. Orion Protocol is open source, allowing for others to not only use, but build on the protocol. We’re paying special attention to making our core modules highly accessible and available to have several replicas and simultaneously working modules. Most components can be run by community members, providing true decentralization of the protocol.
We’re launching a developer kit to expand protocol use to anyone wanting to build on it. A wide variety of applications can be built on Orion Protocol, including dApps for investment, trading bots, and payment gateways.
Yeild farming is a new trending so do you have any plan to yeild farming system development?
Simon: We have a partnership coming up on this imminently, stay tuned 🙂
In your vision, is the Orion Protocol Enterprise Trade Widget easy to implement in any type of business? What are the biggest reasons a company would have to use this system?
Simon: OEWT is a middle layer between crypto projects with utility tokens and all available liquidity of the token on the markets. Tokenized projects' enterprise clients can purchase tokens directly from the project's platform or website by routing orders from all exchanges carrying the token, returning tokens for immediate use. This removes the need for a reserve or treasury.
Why we must use Orion Terminal to trading? Are there any benefits if we trading using Orion Terminal?
Simon: Orion helps traders save time, money, and their assets, enabling them to trade across all major exchanges on one decentralized platform with zero risk.
Time: traders no longer need to waste time exchange-hopping. For the first time, they can access the liquidity of the entire crypto market in one place.
Money: traders no longer need to worry about finding the best price for their assets. Orion aggregates all major exchange liquidity into one seamlessly aggregated order book to provide them with the best price possible. By aggregating every order book, Orion provides the best prices and lowest fees in market with almost zero spread and zero slippage.
Assets: traders no longer need to risk their assets to access liquidity. Now, they can simply connect their wallet and execute their order across any major exchange - even those they don’t have accounts with.
What is the uniqueness of your project that cannot be found in other project. that's been released so far? And how the demand of the token will increase in the future? or what steps would you take to increase the demand?
Simon: There are tens of thousands of trading pairs spread across hundreds of exchanges with different interfaces, fees, processes. And in order to access over 90% of the liquidity in market, traders have to risk their assets on large centralized entities, despite a recent California ruling that enshrined the crypto adage “not your keys, not your coins”.
We don’t think that accessing the crypto market should be so difficult, risky, or expensive. By solving the fragmentation of the crypto landscape, by aggregating the industry into one place, we, alongside partners, are helping shift the industry towards mainstream adoption.
token demand - at the core of Orion Protocol is the ORN token. Orion has ensured deep utility of the token across the ecosystem, integrating it into all main transactions to take the form of an internal currency or utility token.
We're committed to ensuring the sustainability of the ORN token. It’s supply-capped, meaning new tokens are never minted beyond the TGE, while efforts are in place to strategically and frequently remove tokens from circulating supply.
On moving forward through your roadmap, what are your most important next priorities/Milestone? Does $the team have enough fundamental (Funds, Community, ect) to achieve those milestones?
Simon: The most important for us is the completion of the trading terminal for the mainnet release and the improvements of our software that we provide to the community like the broker software
How does Orion Protocol integrate the liquidity of all exchanges? Does this occur only with those associated with Orion? Or does this protocol have the ability to use Cex liquidity pools even if you do not have an alliance with them?
Simon: Also exchanges that do not have an alliance with us can be integrated and provide liquidity using our broker software.
Which area are you focusing on at the moment? (DeFi, Stake,Dapps..) and what is your goals in this year ?
Simon: Our focus is on the trading terminal, the Elrond integration, the further development of our backend system and the integration of the collateral functionality in our smart contracts.
Recently it emerged that Alexey Koloskov, CEO of Orion Protocol, has joined the Forbes Finance Council. What are the benefits or opportunities that being a part of a finance council like this offers and how can this achievement affect the development of Orion?
Timothea: I'll jump in on this one as it's less of a technical question.
Alexey becoming part of the Council brings an unrivaled opportunity for credibility within and beyond the crypto industry, giving us a highly targeted platform to communicate our capabilities in building the future of finance. We’re focused on building a sustainable decentralized finance landscape, and that means working with partners to bring crypto into the mainstream!
As a member of the Council, Alexey has access to a variety of exclusive opportunities designed to help him and the Orion Protocol team reach peak professional influence. He will connect and collaborate with other respected leaders in a private forum. Alexey will also be invited to share his expert insights in original business articles on Forbes.com, and to contribute to published Q&A panels alongside other experts.
As I am a developer with knowledge of programming languages such as solidity, C ++, Java etc., can I create Dapps on your platform ? And HOW easy to create dapps on you platform???
Simon: Yes you can create DApps on our platform. We are already working on a developer kit that should make it easy to implement new projects on our protocol
I Saw that you have many partners. But my concern is, what are tha advantage of these partnership? Are they only for marketing purpose?
Simon: No, our partnerships are not only based on marketing. For example we work very closely with the Elrond Core Devs to work together on the integration of the Elrond blockchain into our system. Furthermore we work together on products like a Token Bridge or a MetaMask for Elrond.
Congratulations to the winners of our AMA @diamondsvietnam, @molestika, @darwin8534580, and @ikingamino7! Please DM @Orion_Protocol on Twitter to collect your rewards.