# RSK-based DeFi protocol launches innovative decentralized exchange concept

DeFi protocol Money on Chain, a lending platform and stablecoin issuer based on Bitcoin (BTC) sidechain RSK, announced Wednesday the launch of TEX, an automated token swap platform based on an order book with a unique twist.

Instead of being available instantaneously, orders are processed in batches according to a slightly variable interval of a few minutes. Each execution, called a tick, matches the orders submitted to the blockchain.

Each trade occurring in a given tick is performed at the same average price between all orders submitted by traders. Limit orders submitted by users indicate the maximum or minimum acceptable price. For example, a limit order to sell Bitcoin for $18,000 will not be triggered if the average price is $17,900.

As Max Carjuzaa, CEO of Money on Chain, explained to Cointelegraph that the system also uses an oracle system for more fine-tuned control. With so-called market maker orders, traders express a price with a certain percentage offset from the reference rate obtained by the oracle. This ensures that the orders will track the changes in price occurring between ticks.

The design of the system was inspired by the London Spot Fix, a pricing mechanism for gold where a committee decides on the price of gold two times per day.

Automated market makers like Uniswap are often seen as a necessity in light of the slow performance of blockchain-based systems. When asked if these concerns drove the design of TEX, Carjuzaa replied:

“No, the primary reason it was adopted is fair price discovery. The method used in the TEX is a way to avoid front-running and ensure fair price discovery, even at low volume.”

Front-running and price discovery are often considered major issues in AMM exchanges, but Carjuzaa also believes the system “needs much less liquidity to operate.” For the same liquidity, he claims AMMs will have more slippage compared to TEX. This benefit is “especially important in a new network, and enables organic liquidity growth.”