OAX is a decentralized platform that is based out of Hong Kong, and they have been working on innovations that will help to promote both themselves and the crypto industry alike. In a new announcement on Friday, the platform announced that they will be able to process 1,000 transactions per second (tps), based on a scaling protocol that is presently in the testnet stage. Overall, this project geared towards DEX usability, but the implementation could make it possible to promote widespread adoptions.

The Director of Technology for the OAX Foundation, Wayland Chan, has said that one of the difficulties that traders used as a reason to refrain from using DEXs has been scalability. The majority of these DEXs work on the blockchain, which means that the performance is not as broad as it could be.

In a phone interview, Chan said,

“Our internal research team found that pretty much all DEXs had the same offering. [But] the feature and functionality were limited by the blockchain.”

Developers sought to offer a better solution through the performance improvements, starting with state channels. The transactions would be settled between two parties off the chain, which will be posted later. The trades will be performed quickly and cheaply, and the network will not have the same strain, which means that all users will benefit from the performance.

However, this concept was unproven a month ago, and Chan has noted that bringing it to light has required “a lot” of research and development in the process. By December, the company was able to test out the protocol on a network and met their goals. Overall, the setup for the scalability will increase with additional nodes.

Chan said,

“We have designed the system to scale horizontally and although increases won’t be linear – 10 nodes doesn’t necessarily mean 10,000 tps – this was still a huge breakthrough.”

As the protocol is now implemented on the testnet, the next goal is to check for and eliminate bugs, while seeking out business partners. There are several unnamed centralized exchanges that Chan has commented that the platform is working with that may ultimately use OAX as their platform.

The appeal of decentralized exchanges is that users have complete control over what they do, which is contrary to a centralized option. Exchange wallets, minimum deposits, and prohibitions over withdrawals do not even exist, and each user has to maintain responsibility for their cryptocurrencies. With these factors considered, users have a greater defense against the potential for hacking attempts.

The largest DEX right now is IDEX, which accounts for about 57% of DEX-based transactions that happened in the last week alone. However, with the size of other trading volumes, these numbers are almost irrelevant. OKEx, for example, accounted for $430 million in trading volume, and Binance handled $490 million in trading volume.

Overall, there is more work that needs to happen. However, the two-layer protocol helps to eliminate something that presently is stopping decentralized exchanges from being adopted on a mass level. More scalability is necessary for users to increase, and the added liquidity makes the experience even better. If this protocol is victorious, this may be the go-to option for DEXs in the same way that the Lightning Network has succeeded.