Market balances refer to the outstanding amount of tokens or coins after a trade has been made on a decentralized exchange (DEX).
Market balances refer to the outstanding amount of tokens or coins after a trade has been made on a decentralized exchange (DEX)
In traditional finance, market orders
are fulfilled at the best available current price and are some of the most common order types filled in the market requiring an intermediary, such as a broker or trading exchange/app to fulfill them. They occur at an asset's current bid price for sell orders and the current ask price for buy orders.
In decentralized finance (DeFI)
, this can be done without a middleman via a DEX, through liquidity pools
either on chain or via automated market makers (AMMs)
, significantly reducing intermediary fees.
Users and traders simply need to connect their digital wallets (such as MetaMask
) to the decentralized exchange, input the amount of an asset (i.e. $USDC) they wish to trade for another asset (for example, $RIN), approve the transaction, and pay a small liquidity provider
and gas fee and receive the amount of $RIN dictated by the market price.
For example, if the market price was currently at $2 per $RIN, a market order of 100 USDC at the same time would give the trader approximately 50 $RIN tokens, excluding transaction and liquidity provider fees.
Once the market order is processed, the $50 RIN tokens would appear under market balances in the DEX, requiring the user to settle
any outstanding balances or funds and claim them back into their digital wallet.
Hisham Khan comes from a decade-long background in managing and building robust and innovative financial and enterprise technology. With an extensive career at Bloomberg and based in New York, Hisham has worked as a project manager with some of the world’s top engineers. It was here where he discovered the transformative impact of cryptocurrencies, and has since left Bloomberg to build comprehensive and accessible trading tools through Aldrin. His core mission is to make advanced crypto trading and strategy development available for everyone