DEX perps with a web2-like UX - Made possible with Account Abstraction!
December 15, 2023
The adoption for centralised exchanges is still much higher than decentralised exchanges. Most normie traders, and even degens, prefer CEXs for a variety of reasons. But the chief reason is the complicated 'web3 UX' associated with DEX platforms. Dealing with wallets, managing gas, Metamask wallet pop-ups after every action, changing networks, using bridges.. all in all the UX is a big bottleneck for users to use DEXs.
But now, thanks to Account Abstraction, DEX platforms are able to offer the best of both worlds - Decentralised with self-custody AND Simple intuitive web2-like UX of CEXs!
UX pain points on DEX platforms vs centralised exchanges
There are 3 big UX pain points because of which users prefer a centralised exchange over a decentralised platform:
1. Constant annoying Metamask pop-ups to sign every tx
2. Paying gas for every tx with different tokens on each chain
3. Primitive trading accounts (EOA) with restricted capabilities
These aren’t just annoying UX. These points also act as major roadblocks to onboard the masses to DEXs. Normies who are used to the web2-like UX of centralised exchanges will get intimidated with such an experience. Moreover, there's an overwhelming feeling that 'they will mess something up' and lose their money.
Without abstracting these UX pain points, DEX perp platforms can not get mainstream adoption. Thankfully, Biconomy’s account abstraction kit is here!
By leveraging Biconomy’s Account Abstraction infra, DEX perps can offer 1-click trading by enabling signless UX with sessions, abstracting gas with paymaster & multi-chain gas tank, and providing trader-friendly features with smart accounts.
DEX UX pain points solved by Biconomy Account Abstraction kit
Sign-less UX with sessions module
Gas Abstraction with Paymaster & multi-chain gas tank
Smart Accounts with trader-friendly features
Let's look at them one by one, along with live examples.
1. Sign-less UX with Sessions Module
User doesn’t need to sign Metamask pop-ups after every action
One of the biggest differences between DEXs and CEXs is the need to sign a transaction pop-up after every action. This is one of the biggest UX pain points faced by a decentralised platform. Constant necessity to sign Metamask pop-ups is just bad & annoying UX.
Moreover, 80% of crypto traders are not used to this concept of signing a pop-up with ‘gibberish’ in it. Thus, this necessity to sign pop-ups is a major roadblock for DEXs to onboard the masses.
Biconomy’s solution - Session Keys Module!
By integrating Biconomy’s session keys module, DEX perps can enable ‘sessions’ for their users. It's basically like logging into a DEX. When you login with a signature, it starts a session. That’s the only time you need to sign a Metamask transaction. As long as the session is active, you don't need to sign any other transaction. So no constant annoying pop-ups to sign every transaction! The UX becomes as seamless as a web2 like CEX platform.
And this idea is not hypothetical. It’s live and gaining adoption. You can experience signless UX with sessions on Rage Trade & Kwenta.
Rage Trade They have enabled Biconomy’s sessions module to enable a session for their user that lasts for 7 days. Once a user creates a session, they won’t need to sign any other action for the next 7 days!
In fact, this session is created on multiple chains (Optimism & Arbitrum) with a single click! By leveraging our multi-chain validation module, Rage Trade allows the users to click just once to
a. Deploy a smart account on all supported chains
b. Delegate UserOp execution
c. Authorise sessions keys to create a session
Kwenta Another live example of sessions is Kwenta. The user can choose how long they want the session to last & enable that from this easy UI.
Gas Abstraction with Paymaster
Sponsor user’s gas or let them pay automatically via multi-chain gas tank
The other big difference between DEXs and CEXs is the necessity to pay gas on every transaction. It’s a big UX pain point that’s been Biconomy’s arch nemesis for 3+ years. With DEX perps usually aggregating on multiple chains, it means that users need to buy, bridge, and manage gas tokens on all these chains.
Moreover, once again normie traders are not used to the concept of gas. For a new trader trying a DEX perp who wants to initiate a trade on Avalanche, it can mean understanding & doing the whole process of bridging funds to Avalanche, acquiring AVAX for gas & then paying gas for the trade.
Thus, necessity to pay gas is another UX roadblock for DEXs to onboard the masses.
Biconomy’s solution - Paymasters
DEX perps can leverage Biconomy’s Account Abstraction stack in multiple ways to abstract gas:
Sponsor all transactions
They can use Paymaster service to sponsor all the gas for their users. Or selectively sponsor certain users or transactions.
Such a gasless experience completely removes all gas complexities for the user.
Enable a ‘multi-chain gas tank’
With a multi-chain gas tank, a user tops up their gas tank on ONE chain with ONE token. And then when they perform an action on any chain, gas is automatically deducted from their multi-chain gas tank!
Thus, the user doesn’t need to maintain gas tokens on multiple chains. All the swapping & bridging is abstracted from the user!
DEX perps can enable either of these options to abstract gas UX pain points & make their UX as seamless as a web2 like CEX platform.
We have seen different projects abstract gas in slightly different ways, but all of them have a common benefit - no pop-up to pay gas at every step!
Deperp is a DEX perp on Base that has leveraged Biconomy Paymaster to make their entire experience completely gasless! No pop-ups to pay for gas.
Rage Trade uses the concept of a multi-chain gas tank. A user can deposit ETH or stablecoins into the gas tank from any chain. The gas is auto-deducted from this tank when they perform actions on any chain. No more pop-ups to pay for gas.
Kwenta deploys a gas tank on Optimism by leveraging Biconomy. The users can create and fund their ‘1 click trading’ or 1ct account, which is powered by Biconomy Smart Account. Then when they use this account to open a trade, gas is automatically deducted.
Perpie is a telegram bot focussed on Perps. They leverage Biconomy Paymaster to let user’s pay gas in the token of their choice! For example, if a user is transacting with USDC, they can pay gas in USDC itself.
Smart Accounts with trader friendly capabilities
Users enjoy a customised UX with smart trading accounts
Another big difference between DEXs & CEXs is the trading account. Centralised platforms can provide tons of features on their accounts, while DEXs rely on the old & restrictive EOAs. It means that even if DEX perps want to add certain features on their platform, they will likely be restricted by the user’s EOA capabilities.
Biconomy’s solution - Modular Smart Accounts!
First things first, the signless UX with sessions is not possible without smart accounts!
But the beauty of smart trading accounts is that enabling modules can enable many more amazing features:
1. Easy Onboarding with social login, passkeys (bio-metrics) & more!
2. Batching multiple transactions into a single click
3. Trader friendly features such as sub-accounts, limits, loyalty perks etc.
The best part is that Biconomy smart accounts can be endlessly customised and upgraded with modules to create the perfect trading account as per the DEX platform’s needs. If there is a certain feature idea, the platform can easily develop it as a module and plug it in the Biconomy Smart Account! And there is also the upcoming module store, where certain trader friendly modules will be created by third parties that can also be easily plugged in by any DEX platform!
Perpie deploys smart trading accounts for their users on which actions are triggered by using a Telegram bot ‘interface’! It would have been extremely challenging to bring a Telegram bot based DEX perp without smart accounts.
Moreover, they also batch up multiple transactions into one click using Biconomy to enable an intent-centric UX! Thus, users don’t need to deal with multiple approvals & transactions.
Deperp is one of the DEX perps that uses social login.
Going forward, we believe all DEXs will leverage Account Abstraction to enable a web2-like experience.
And Biconomy will play a big part in propelling mainstream DEX adoption.
If you want to enable a similar seamless experience on your DeFi app, talk to us!
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