A comprehensive analysis on DEX liquidity aggregators’ performance

After accounting for gas costs, 7 out of 10 times 0x API offers better prices than 1inch, Dex Ag, Paraswap and Uniswap.

TL;DR

  • 7 out of 10 times 0x API offers better adjusted prices than 1inch, Dex Ag, Paraswap and Uniswap. That is, the price after transaction fees are paid.
  • 0x API v1 delivers market-leading gas efficiency. With a custom, highly-optimized architecture, accessing Uniswap’s liquidity through 0x API is now as cheap and often cheaper than going to Uniswap directly.
  • Aggregators exist to remove the mental hurdle of finding the right platform to trade by guaranteeing that you get the best the ecosystem has to offer. However, not all aggregators are created equal: they have different levels of performance in terms of pricing, quoted price accuracy, gas usage, revert rates and response times.
  • The best quoted price doesn’t always result in the best adjusted price. Just like buying an airline ticket, you need to be careful about hidden fees/costs. While the base ticket might be cheaper, when you price in all of the add-ons (baggage fees, preferred boarding, seat assignments, etc.), you might end up paying more.
  • 0x API and Matcha — which uses 0x API under the hood — are two products launched by 0x Labs to offer DeFi developers and traders a simple way to buy and sell assets at the best price possible across all DEX liquidity sources.

DEX liquidity wars and the rise of aggregation

In the past few weeks, there has been a surge of new liquidity sources, with over $4Bn capital spread across more than 15 sources and new ones coming up every week. As a result, DEX liquidity has become more fragmented than ever, making it more complex for DeFi users to find the best price for a given trade.

This in turn has led to the rise of ...

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0x Blog - Medium

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