DLOBex

A Central Limit Order Book Implementation for Hedera showcasing Limit and Market Orders, Trades and Atomic Settlement. Support for HSM for Signing.

Comment

Inspiration

I was inspired by building something that did not exist in traditional DeFi while learning Solidity as well as Hedera's Java SDK. CLOBs can be quite complex and many rules can be coded in the smart contract, but showing the basics was my first goal.

What it does

DLOBex is an implementation of a CLOBs with the ability to:

  • Start/Stop trading by an operator
  • Whitelist participants
  • Each participant can add market and limit orders
  • Some of those orders can result in trades where the smart contract performs a swap on-the-behalf of
  • Each DLOBex can be instantiated with any ERC20 token address

How I built it

  • The Solidity code was built with Visual Studio Code IDE and Hardhat
  • The Java code was built with OpenJDK 17 and IntelliJ IDE using Hedera's Java SDK
  • The HSM used was Cysec's

Challenges I ran into

I faced a fairly steep learning curve working with Solidity - and the code shows! Lots of optimisations are still required.
The second challenge was the decoding of native solidity payloads using Web3J (another Web3J learning curve).
Finally, the interaction with the chain, using Java was challenging but several examples provided in GitHub. proved to be very helpful.

Accomplishments that I am proud of

  • Learning Solidity
  • Learning Hedera's SDK
  • Ability to use a Hardware Security Module to generate addresses and sign payloads

What I learned

I enjoy learning about Hedera, Solidity and Web3J as well as the integration with a Hardware Security Module for the key generation and payload signing.

What's next for DLOBex

I will be adding when time permits more business rules to orders such as fees handling, penalty for misbehavior, time-based orders, price difference enforcement to increase liquidity, writing the trading rule book, and so on.

Note on prior work

Since I became aware of Hedera (years ago) - I also thought about CLOBs on Hedera. My first implementation was done with the Swirlds SDK (https://www.swirlds.com/) running locally a couple of years ago. I have also in my pastime before H22 looked a how CLOBs would work in Solidity and Solana Rust and how to interact with the Test Network using Java.

Built With

Share this project:

Updates