Index Chain

IDEX is the native token of IDEX, a decentralized exchange that combines an order-book model with an automated market maker. Order books, popular on centralized exchanges like Binance and Coinbase, match buyers with sellers, while automated market makers, such as Uniswap, facilitate token swaps from huge reserves of tokens.

The IDEX token was released in 2019 at a price of 3.4 cents. The price rose to 18 cents in April 2021, just as the crypto market hit its first peak of the year. IDEX rose again in September 2021, when tokens of decentralized finance (DeFi) platforms climbed sharply and two months before bitcoin hit its all-time high of $68,789.63.

In the four days starting on Sept. 4, 2021, IDEX surged from 6 cents to a high of 97 cents. The token then fell to 30 cents by the end of the month. IDEX continued to fall for the rest of the year and into 2022, when a crypto winter iced over the majority of the crypto market. The token sank to lows of 3 cents in May 2022.

IDEX launched with a supply of 1 billion. Of that, 40% was earmarked for incentives, the team kept 50%, and 10% was reserved for “future use,” according to its 2019 white paper.

IDEX is a “hybrid liquidity DEX” (decentralized exchange). It combines an order-book and matching engine with an automated market maker.

Order books are tables of buyers and sellers. If someone places a transaction to, say, buy $10 worth of bitcoin (BTC), a matching engine adds it to an order book and pairs it with someone willing to sell $10 of BTC.

Automated market makers maintain vast reserves of tokens provided by their users. When someone wants to buy $10 of BTC for U.S. dollar-based stablecoin USDC, an AMM takes funds out of a liquidity pool that holds both BTC and USDC (it can also reroute the trade across several liquidity pools, but the principle remains the same). The pool, now $10 richer in USDC and proportionately poorer in BTC, will adjust the prices of funds in the pools, making USDC ever so slightly cheaper until someone else rebalances the pool.

Liquidity pools tend to be deeper, but order books can be faster. IDEX combines both of these models, wildly different though they are, and offers traders the cheaper option. Raydium, a decentralized exchange native to the Solana blockchain, does something similar; it combines its AMM pools with an order book-based DEX on Solana called Serum.

IDEX used to control a sizable share of the market for decentralized exchanges. In October 2019, Decrypt reported that IDEX executed over 40% of all transactions on decentralized exchanges. That control soon slipped away. As of June 2022, IDEX has a total value locked (TVL) of $34 million. By comparison, Curve, the largest DEX, has a TVL of $7.89 billion.

The IDEX token is used for staking, liquidity mining and governance. IDEX stakers earn 50% of trading fees collected by the network.

IDEX used to be called Aurora. Aurora issued AURA tokens in 2018, which since 2019 could be swapped for IDEX tokens after IDEX consolidated with Aurora. There isn’t a deadline for the swap.

IDEX was founded by brothers Alex and Phil Wearn in 2016. Alex Wearn is the project’s CEO. and Phil Wearn is its chief operating officer. Jason Ahmad is the chief technology officer.

The platform is native to the Ethereum blockchain, and it launched on Polkadot and BNB Smart Chain in December 2020.

In May 2022, the team started work on IDEX v4, which introduces decentralized perpetual swaps.