Updated: Jul 16, 2019
In a previous article (thedecrypter.com) we talked about the COSS exchange and its profit sharing with the COSS token. As said in that article, that is the kind of crypto the legendary investor Warren Buffet would go for, if he were to invest in crypto. However, COSS is not the only one of these profit sharing tokens. I would like to introduce you to a newcomer to this stage: Nash with its NEX token.
The Nash exchange recently entered its beta stage so the success of the exchange can only be speculated. However, it is doing a great job at marketing, with quite a lot of buzz surrounding the project and they recently started a referral campaign where you get tickets for each person you reffer, and for creating an account yourself. When the exchange launches, each account with at least 25$ worth of assets will activate both their own tickets and their referee's tickets. There will be 34 winning tickets, randomly selected, with the highest price being 35,000$ of Bitcoin and 15,000 NEX. If you would like to participate, and have an account ready for the launch of exchange, feel free to use our referral link: https://nash.io/referrals?code=3542rd (It is also a good way to support our site!). Simply making an account and having 25 bucks in it will give you a chance at the 35.000$ of Bitcoin and 15,000 NEX.
Bitcoin, of course, is Bitcoin. But what about the NEX tokens? Well, they are used to share up to 75% of the fees generated on the Nash exchange. We will go more into detail on this later.
But what about the actual product? Well, as said, the project is still only in beta so there is not much to go on, and what we see now will probably improve when the final product is released.
What we do know is that Nash will be a decentralized exchange (dex), which means that the trades are done peer to peer, assuming it is a true dex. This allows for less risk of hacks and manipulation and more anonymous trading. However, a true dex will also, in most cases, have slower processing of trades. I believe that being a DEX, no matter the degree of decentralization, is beneficial for the exchange because it is a big trend in the crypto space. Followingly it will drive adoption of the exchange as more and more users prefer to use a dex over a normal exchange. Also a dex is aligned with the goals of crypto, being decentralized, anonymous and allowing for more freedom.
Nash is built with a matching engine which will match trades from different wallets. Your wallets can be viewed on the exchange but only you have the private keys to them. The NEX tokens are built on NEO, a smart contract blockchain platform. We will write a future article on NEO to go more in depth, but you could compare it to Ethereum in its functionality.
Judging from current screenshots, the exchange has a very clean and professional UI, which is very important for exchanges. Another important part, which unfortunately cannot be judged at the moment is its speed and usability, meaning how the backend works. Trades need to be fast and reliable, but this will have to show when the exchange is released and some patches have been implemented.
Also, you must remember that Nash will not be alone as a dex, Switcheo is a strong contender, also utilizing NEO. Switcheo is a dex built on NEO, and has been in use for quite some time now. Switcheo works fine, but I think that there is room for competition. Firstly, there is room for improving the UI and functionality of the platform. I, and probably many with me, would prefer a brighter UI than what Switcheo offers, which is something Nash is providing. Also, Switcheo does not have many high volume cryptos available. Yes, there are quite a lot of pairs but most of the cryptos available are quite obscure. A majority of the top 25 coins by market cap are not available, for example. Also, even if Nash does not end up being as good as Switcheo, they have shown to be great at marketing, and that alone could drive the exchange volume.
But probably the most important part is the native token of the exchange. Switcheo has its Switch tokens but they merely reduce trading fees. Nash's native token NEX are used to share the fees of the exchange. This will drive volume to the exchange. As NEX has good token economics, and a clear value in receiving a share of the fees generated by Nash, people will want to hold NEX and thus also want to use the exchange as their fees are paid back to them. The more trades you make on the exchange, the more money you will receive from your NEX tokens! these kinds of tokens tend to build loyalty with customers and holders.
NEX can be staked with a lock-in period of between 1 and 24 months. The longer the lock-in period, the higher share of fees you will receive:
1 month: 25% of fees
12 months: 50% of fees
18 months: 67.5% of fees
24 months: 75% of fees
The fee-split is paid out monthly, meaning that your share of the fees will be transferred to to your account every month for as long as you stake. You will receive your fee-split in the currencies that the fees are paid in. This means that the the higher the volume of a crypto on the exchange, the more of that crypto you will receive in your share of the fees. What this does is that it will build a volume weighted index for you. The reason being that you will receive crypto relative to the volume traded on Nash.
This may be hard to get your head around, so let's make an example. Let’s say the only cryptos traded on Nash is BTC, ETH and NEX. One month BTC constitutes 60% of the trade volume on the exchange, ETH 25% and NEX 15%. As each trading fee is paid in the traded currency, your fee-split would also be received as 60% BTC, 25% ETH and 15% NEX. This volume weighted index would be a good part in any crypto portfolio.
These monthly payouts makes NEX a security in many countries. However, this is something that the team is aware of and, in their own words, "Nash aims to be maximally compliant". NEX is actually registered as a security with the European Securities and Markets Authority (ESMA), making NEX the first crypto fully registered as a security in Europe. Although this means that there will be more KYC and other regulations imposed on the exchange, it also takes away many regulatory risks. I believe that in the long term, all crypto exchanges will become more regulated as the market grows. There is now way governments will just let billions of dollars in assets be traded without any regulation. Nash going through these hurdles now will prove to be very beneficial, in my opinion.
Nash is actually more than just an exchange. They offer portfolio tracking, wallets, payment gateways, a browser extension and more. But to not make this article infinietly long I have chosen to just focus on the exchange part here, as it is the exchange fees that is shared with NEX token holders. I will do a follow-up on Nash when the project has come further. Then I will discuss the other aspects of Nash.
To sum it up, Nash is a legally compliant dex, with a token, built on NEO, that gives your share of up to 75% of the fees generated on the exchange. If the team can deliver, and they list many top coins I believe Nash can be one of the top decentralized exchanges in the future. If this is the case, NEX will pay hefty dividends and, followingly, the price of the token should shoot up. If you want to learn more about why productive income generating assets are so good for your returns you can read my other article here: thedecrypter.com
Always remember though, this is IF they deliver. Nothing is for certain.
Thanks for reading, and don't forget to support us and take your chance to win a bunch of Bitcoin and NEX with our referral link: https://nash.io/referrals?code=3542rd
/Alex - The Decrypter.
Note: Invest at your own risk and always make sure to research your investments thoroughly.