Hybrid Crypto Exchange Ethfinex Announces They Are Decentralizing Their Coin Listing Process
The Ethfinex exchange has announced that they are teaming up with Kleros to decentralize its token listings using Kleros’ dispute resolution layer.
It's back! Introducing the new and improved Ethfinex Token Vote, including fee-sharing, decentralised curation with @Kleros_io and a host of additional features, making for a fairer, more transparent and fun experience.
— DeversiFi (@deversifi) March 7, 2019
Token listings on major exchanges are sometimes contentious, with allegations of vote-rigging and other underhand tactics by project teams and supporters eager to see their altcoin make the cut. Kleros and Ethfinex are optimistic that the solution they’ve pioneered will be more transparent and community-focused.
Previously, Ethfinex would simply put tokens up for a public vote, but now the decision is firmly in the hand of the exchange’s users:
“Until now, the Ethfinex listing process consisted of Ethfinex picking the best projects to put forward to a public vote, which was then carried out by users of the Ethfinex exchange. Voters would assign voting tokens (EVT) to the project they most wanted to be listed on both the Ethfinex and Bitfinex exchanges. At the end of the voting process, the top three tokens were listed. This process worked well for the most part but now, in the true spirit of cryptocurrency, it’s moving to a fully decentralized curated list backed by Kleros dispute resolution.”
How Does It Work?
The first step involves the user submitting a particular token which must adhere to Ethfinex’s listing guidelines. The user will have to pay a small deposit fee in ETH, which is returned if the submission goes unchallenged or is rejected by the Kleros jurors.
After this other users can challenge a particular submission if they believe the token is unworthy of listing because of a lack of trust in the token, if there’s missing information, or if they suspect malicious intent.
Challenges to submissions then go into arbitration. Arbitration occurs through the Kleros’ Athena Court Dapp, where jurors are selected after they have staked PNK tokens (the Kleros native currency). Once appointed, the jurors decide if the token meets the criteria and is a worthy inclusion, or if it violates any rules.
You can learn more about the listing process and more about the companies from their blog post.