Ten Things You Should Ask Switcheo or Any DEX Before Using it
What is a DEX? There has been much debate on what constitutes a DEX and the degree of decentralization is often a tradeoff for the speed of the exchange. From the early days of EtherDelta, where trades are all done on-chain, to its successors like Switcheo and IDEX that rely on off-chain order matching to allow for trades to be executed much faster, we will be talking about a few DEXs that the crypto community seem to be most excited about in this piece
• EtherDelta, debatably the first DEX ever
• Switcheo: a DEX on both NEO and Ethereum, with atomic swap features
• IDEX: the most popular DEX on Ethereum currently
• Nash (previously known as NEX): a security exchange + DEX
• Aphelion: a DEX on NEO
• Binance DEX: the newest addition to the Binance exchange family
I have used DEX’s for several years and have noticed the good and bad about them. I like what the Switcheo team is doing, and I think it is time for all DEX’s to be held to a higher standard if we want to see mass adoption to them. As this article is pretty long, I’m going to post it in two parts. If you have questions, comments or something you look for in a DEX, let me know and I’ll try to incorporate it into the second part.
What options do you offer to log in?
This is an important question for the security of your funds. The safest login option will always be Ledger/Trezor, where your private keys never leave the device. If a DEX doesn’t have a Ledger/Trezor login option, you should really hesitate to use them.
Metamask, JSON file, and encrypted key & paraphrase are the other most common DEX login options but aren’t as safe as using your private keys. DEX’s do not store your keys, but if your computer or browser were to get infected, you could lose all your funds. If you are like me, you don’t want to risk it, even if there’s only a small chance of it happening. Switcheo has both Ledger and Trezor logins. If the DEX you are planning on using doesn’t have these options, you should ask them why?
Here are some pictures of the login options that Switcheo offers:
Along with Switcheo, I know IDEX and Aphelion both have Ledger options to login with, but the new NASH exchange will not have it from the beginning.
Can I still retrieve my funds if you were to shut down?
What happens if the DEX you are using one day decides to shut down, and the website goes offline, are you able to retrieve your funds? If not, I’d seriously hesitate on using that DEX. I asked Switcheo admin this exact question and they said “yes, you can still withdraw funds from the contract even if we were to shut down,” and they provided me with the instructions on how to do a manual withdraw from the contract. You can view the instructions here: manual withdraw)
This is something that is very important, and I would not trade on a DEX that doesn’t have manual withdraws from the contract. The DEX you are using should also have a manual in place for this process. While there’s only a small chance the DEX you are using will shut down, you don’t want to lose all your funds if it does happen.
If there’s a problem, do you offer any kind of customer support?
We’ve all been on a DEX before and had a question or can’t quite figure out how to do something. I remember the first time I had a question on Ether Delta, I wondered, “Why do I keep wasting gas on orders that don’t complete?” It was my first time using it and I didn’t realize the order I was trying to buy was already sold. The problem was there was no one to ask. Even though these exchanges are DEX’s , they are still collecting fees and making a profit, so there should always be someone to ask if you have an issue.
Switcheo has 24/7, 365 days telegram support where there is always an admin on duty to quickly answer any questions or help you with an issue that you may have. They also have a Reddit channel where they answer questions, a customer support email, and an intercom channel where you can speak with a customer support person live. As someone who has sent emails to an exchange and waited over a week for a response, I love this! All DEX’s should follow Switcheo’s model for customer support.
I do not know if the new Binance and Nash DEX’s will have a customer support system or not, or which options, but I was able to find that IDEX has a Discord channel and Freshchat, which is much like Intercom, that you can speak with a customer support specialist one on one. Aphelion has a telegram channel for their support, however, their support seems to be very unresponsive with only 1 active admin in their channel.
It is very important in my opinion for a DEX to have good customer support. Everyone using your DEX should feel comfortable that if they have a question or problem that it can be answered quickly. If this isn’t the case, people will leave and never return.
Do you have guides, videos, etc. that show how to trade on the exchange?
To drive the adoption of dApps to users, it is important for dApps, especially DEXs to have a great user experience. Part of having a great user experience is sufficient onboarding guides, which explain the many steps a user must take to trade on a DEX, as this experience varies greatly from using a centralized exchange. I believe most DEX’s have guides on how to use the exchange, but I asked Switcheo if they could provide me with one, nonetheless. Here is their trading guide that shows how to login, buy, sell, withdraw, etc.: Trading Guide
If an exchange doesn’t have trading guides and videos, how can they expect to draw users from CEX’s that they already know how to use to a DEX they are unfamiliar with?
Is the exchange contract code public?
This allows for DEX users to verify that the trades are truly trustless and to prove that the DEX does not have custody of the user’s funds, it is important for the exchange code to be made public. Aphelion has only recently made their code public after taking their exchange down to fix possible contract vulnerabilities that allowed malicious actors to withdraw user’s funds from their exchange contract.
It is important that exchanges in this space be transparent. If a DEX’s code isn’t public, you should ask why before using it.
Thank you for viewing the first part of my “Ten Things You Should Ask Switcheo or Any DEX Before Using it.” I am still making the finishing touches on the second part, so if there’s something you’d like me to add, just put it in the comments and I’ll do my best to add it. Always do your own research and ask questions before using an exchange.