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Oct 17, 2023
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One Giant Order Book: How Orderly is “Unfragmenting” Liquidity
by Orderly Network
orderly-is-solving-the-liquidity-problem-in-defi

Orderly recently revealed that we are now omnichain. We have built an order book that unites liquidity across all blockchains. Every DEX on every chain, if they choose, can settle orders in one order book. The result? The deepest liquidity ever seen in crypto, and a trading experience that no degen has ever experienced before.

Sounds incredible right? How is this wizardry achieved? In this article we will break down the mechanism behind it.

orderly-evm-flow-2

The User Journey:

A user will go to their favorite dApp that has integrated with Orderly. The user will deposit native $USDC through the dApp into what Orderly calls an Asset Vault. Vaults will be deployed on all major blockchains.

There is no bridging of assets in any of the steps. Native $USDC is used. Native assets are much more secure than bridged assets.

The deposit/withdrawal stage is the only part of this process where a user will pay a gas fee. All trades are gasless!

In addition to being gasless, you will not have to deal with countless signing of transactions. Only one signature is needed when you deposit/withdraw funds. This makes it seamless even for users trading with hardware wallets.

Now that the user’s funds are in the vault, the magic can take place.

orderly-infrastructure-layer

A User places an order on their chosen dApp. The order goes through a chain indexer. which is tasked to help keep track of all activities and ensures that data is organized and searchable.

It then arrives at Orderly’s extremely fast matching engine where all orders, from all chains are sent to. A single order book for all blockchains.

Every single order shares one giant concentrated order book. This is similar to how stock exchanges work. Liquidity is not fragmented. CeFi at the front, Defi at the back.

The whole time this is happening, we must bear in mind that the users’ funds are still in their own self-custody. No assets are bridged. Only messages are sent, powered by LayerZero technology. This creates an extremely secure environment.

Great, now that the order has arrived at the matching engine. It is matched and settled exactly as quoted. No gas and slippage here. Your trade has now been executed.

The settlement is recorded on Orderly’s settlement layer, an L2 powered by the OP stack. All transactions are fully transparent and verifiable by anyone.

The user balances are then synced using LayerZero messaging and updated.

This whole process is done in milliseconds. CEX-like speeds. Sufficient for API traders and high-frequency traders.

The best trading environment a degen will ever experience. This is decentralized institutional-grade trading infrastructure open to everyone.

Frens, that is how Orderly Network is concentrating liquidity from all major blockchains.

All systems operational.
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