So I finally got around to seeing what the state of affairs is for decentralized exchanges. I took a look at BarterDex. And before I get started here, I'm not trying to knock their project. Really, I'm not. I applaud their efforts and we badly need decentralized exchanges. However... To say that the orderbooks are thin would be an understatement. There were 4 bids and asks for BTC, 1 bid and 1 ask for BCH, and basically nothing for anything else.

So basically, no liquidity. All but unusable.

I also noticed that the base pair for everything is Komodo. Or Komodo Coin. Whatever its called. I guess that is how they give value to their coin -- because it will have utility on this decentralized exchange.

Now, on the surface that sounds like a pretty cool idea.

But then I started wondering about how can we get more traction here. How can we build up liquidity? I thought maybe there would be an incentive for people (maybe even me) to come on board and become market makers.

Yeah, I could start putting a bunch of bids and asks and help provide liquidity to anyone who wants to trade. Obviously i'll make a big spread at first and profit that way. That's the natural economic incentive there. But wait... How would I even know what to bid to ask if everything is priced in Komodo? I'd have to convert it. And then i'd have to deal with the instability and volatility of such a relatively insignificant coin.