In this episode of Blockchain Banter, I sat down one-on-one with Dr. Mark Richardson, Project Lead at Bancor. Usually, my Tuesday trading call focuses mainly on Bitcoin, the liquidity book, and tools and strategies for traders using centralized exchanges, but today, we’re diving into onchain trading, and what Bancor and Carbon DeFi have to offer.I titled my call “Bringing the CEX Trading Edge Onchain” because I wanted to explore how Bancor’s tools make that possible. But after today’s call, it’s clear that what Carbon DeFi offers doesn’t just match CEXs– it goes beyond them.
The Evolution of Trading Onchain
It started with a recent tweet from Bancor that caught my attention. Someone pointed out that Base, a major Layer 2 blockchain, doesn’t have limit orders– something standard in centralized exchanges. Velocimeter DEX quickly responded, highlighting its limit order functionality through Graphene, a licensed deployment of Carbon DeFi.
https://x.com/Bancor/status/1896604268016304446
DeFi trading has traditionally been associated with automated market makers (AMMs), where users provide liquidity and earn fees. However, Carbon DeFi takes a different approach– it’s designed for those that are profit driven– traders, not liquidity providers. Instead of relying on liquidity pools, Carbon DeFi functions more like an order book-style system.
Mark broke down three key order types traders can use:
Limit Orders: Set a specific price at which you want to buy or sell an asset. Unlike AMMs, where you must accept the market price, Carbon DeFi lets traders place limit orders similar to traditional order books.
Range Orders: A powerful tool unique to Carbon DeFi, allowing traders to scale in and out of positions over a chosen price range, similar to laddering orders.
Recurring Orders: Automates the process of selling high and buying back low, executing trades in a continuous cycle without requiring constant monitoring.
These tools allow traders to pre-set trades, automate execution, and maintain full control over their orders– something not typically associated with onchain trading.
Scaling In and Out with Range Orders
One of the biggest mistakes traders make is going all-in at a single price point. Mark explained how successful traders don’t operate this way. Instead, they scale into and out of positions strategically.
Range orders on Carbon DeFi allow traders to set a range of prices over which they will buy or sell an asset. This method mirrors how professional traders ladder their orders, helping them manage risk by avoiding a single entry or exit point. For example, if a trader wants to sell Bitcoin between $87,000 and $95,000 instead of setting one target price, Carbon DeFi automatically distributes the sell orders across that range.
Automating Trades with Recurring Orders
Another unique aspect of Carbon DeFi is recurring orders. Mark explained that traders don’t just buy an asset once and hold it forever– they continuously buy low and sell high.
Recurring orders automate this process. Instead of manually placing new orders after every trade, Carbon DeFi allows traders to set up a strategy where one order automatically funds the next.
For example:
Buy Bitcoin when it dips to $75,000.
Sell it when it rises to $85,000.
Use the proceeds to buy more Bitcoin when it dips again.
Repeat indefinitely.
This removes the need for manual trade execution, eliminates slippage, and prevents traders from missing opportunities.
Debunking the Myth: DeFi vs. Centralized Exchanges
A common misconception is that DeFi cannot compete with centralized exchanges in terms of trading efficiency, order execution, and available tools. This perception, however, is entirely outdated.
As Mark points out:
“The stuff that you find onchain, Carbon DeFi included, is already offering tools and services that really embarrass conventional centralized exchanges. People often ask, “When will DeFi be able to hold its own against centralized exchanges?” But the reality is, DeFi has already left CEXs in the dust.”
The tools available on Carbon DeFi are more advanced than what centralized exchanges offer, and they function with greater efficiency, automation, and customization. Features like range orders and recurring orders provide an unparalleled trading experience, one that doesn’t exist on CEXs.
While some argue that blockchain transaction fees can be a downside, Carbon DeFi operates on networks like Sei and Celo, where executing a trade is already cheaper than setting up a single limit order on Binance or Coinbase. The notion that DeFi is lagging behind is nothing more than a myth– one that fails to recognize how far decentralized trading has come.
If DeFi is already offering superior trading tools, why do some still hesitate to switch from CEXs? One commonly cited reason is fragmented liquidity– an issue Mark firmly challenges.
The Fragmented Liquidity Myth
A common argument against DeFi is liquidity fragmentation– the idea that liquidity is scattered across various platforms, making it difficult to execute large trades efficiently. Mark pushed back against this notion, explaining that Carbon DeFi doesn’t rely on its own liquidity. Instead, it aggregates liquidity from across an entire blockchain.
“Ethereum mainnet has been more liquid than any centralized exchange for years,” Mark explained. “But people misunderstand liquidity because they look at individual DeFi protocols instead of the entire blockchain.”
When makers create an order on Carbon DeFi, they’re tapping into liquidity from Uniswap, Curve, Balancer, and other protocols. This means better execution, deeper liquidity, and improved trading efficiency– making DeFi, especially Carbon DeFi, an even more powerful alternative.
How to Use Carbon DeFi
To help demystify the process, Mark demonstrated how to create different orders on Carbon DeFi:
Limit Orders: Select a price and fund the trade. When the market reaches that price, the order executes automatically.
Range Orders: Define a price range and fund the order. The platform distributes the order size across the range, executing trades as the market moves.
Recurring Orders: Link a buy order with a sell order, enabling automatic re-entry into trades without needing to manually reset them.
What’s Next for Bancor and Carbon DeFi?
Bancor has a history of pioneering DeFi innovations. In 2017, it introduced the first constant product Automated Market Maker (AMM). In 2020, it invented Concentrated Liquidity. In 2022, it developed Asymmetric Liquidity and Carbon DeFi. So what’s next?
Mark couldn’t share specific details but confirmed that Bancor is always developing new features. As with past innovations, anything new will be fully audited before release.
Final Thoughts
If you’ve ever doubted whether onchain trading could match the sophistication of CEXs, it’s time to reconsider. Trading onchain has evolved far beyond simple swaps on AMMs, and the myth that DeFi is behind CEXs in trading technology has been thoroughly debunked.
In reality, platforms like Carbon DeFi are pushing the boundaries, providing traders with more control, better execution, and automated strategies that simply don’t exist in centralized trading. DeFi isn’t just catching up– it’s leading the way.
One last final thought: Don’t be a sucker like I was.
Blockchain BanterBlockchain Banter is a live, unscripted discussion series where industry experts, builders, and thought leaders come together to share knowledge, challenge ideas, and explore the evolving landscape of DeFi and blockchain. Tune in weekly to join the discussion!🎙️ Follow me on X at x.com/Here2DeFi and tune in weekly:Tuesday Trading at 3PM UTCWednesday Debates at 3PM UTC
