Rubicon is a decentralized exchange protocol for digital assets on the Ethereum blockchain. People all across the world can use Rubicon to trade crypto assets 24/7. Presently, financial markets are riddled with networks of intermediaries behind the scenes. All of these intermediaries take their share, whether it be with vampiric fees or selling user data, and at the end of the day consumers simply looking to participate in the financial system come out as the biggest losers of the entire process. Rubicon replaces these intermediaries with immutable code, allowing any asset on the Ethereum blockchain to trade on an open order book marketplace. If you want to learn more about Rubicon and our mission, check out our whitepaper.
How do I use Rubicon?
To trade on Rubicon you will first need an Ethereum wallet. Once you have a wallet, you will need to get some ETH. You can purchase ETH in our app by clicking "Buy Crypto" and using Ramp. If Ramp is not available in your jurisdiction, check out the Ethereum Foundation's guide to buying ETH.
PSA: If you are buying ETH to use on Rubicon, you will want to connect your wallet to the Optimism network. If you have assets on Ethereum mainnet (layer 1) that you want to trade on Rubicon, you will have to deposit your assets onto layer 2 using a bridge.
How do I get my assets onto layer 2?
To get tokens from your Ethereum wallet onto a layer 2 solution, you use a bridge. Bridges fall into one of two categories: Native Token Bridges that are built into the layer 2 solution by the core developers (ex. Optimism Gateway), or General Token Bridges that are built by third-party developers (ex. Hop Exchange). A native bridge is subject to the withdrawal wait times of its layer 2 solution, while a general bridge might offer immediate withdrawals in exchange for a fee. We encourage you to do your own research on the different bridge options before bridging your tokens onto layer 2.
What is layer 2 (L2)?
The best definition for layer 2 scaling comes from the Ethereum Foundation's official page. At a high level, layer 2 refers to scaling solutions for Ethereum that remove transaction execution off of the Ethereum main chain (layer 1) onto a second layer (layer 2). Layer 2 transactions are batched together and their output data is sent back to Ethereum layer 1, so the finality of all L2 transactions is still dependent on the Ethereum main chain. These solutions are able to significantly reduce transaction costs and increase transaction throughput while still using the security of layer 1 Ethereum. Layer 2 solutions effectively take applications on Ethereum from operating on dial-up internet to high-speed broadband! Rubicon will be on multiple layer 2 solutions, starting with Optimism.
What is a decentralized exchange?
A decentralized exchange (DEX) is a protocol that allows users to trade assets on a peer-to-peer basis. There is no trusted third party like a bank playing a role in the exchange of assets. Centralized crypto exchanges are often hacked, have their servers crash on volatile trading days, have long withdrawal periods for users, and have full control of user funds at all times. Decentralized exchanges like Rubicon are built on smart contracts, so the exchange protocol never crashes and users always retain full control of their funds.
At its core, Rubicon is a series of smart contracts built on Ethereum. These contracts house the key two elements of the protocol: the Rubicon order books and Rubicon Pools. To read a more technical explanation, go to the Contracts section of these docs or check out the protocol for yourself on Github. The Rubicon team also built our web application so you can easily interact with the protocol rather than manually interacting with smart contracts.
Rubicon uses an open order book, meaning all prices are determined by a two-sided marketplace of buyers and sellers. When a user wants to buy an asset, they have two choices. If they simply want to buy or sell the asset at the current market price and want immediate execution, they can submit a market order. A market order will fill the user’s buy or sell order ASAP at the best possible price on the Rubicon order book. If a user has a specific price in mind for buying or selling an asset, they can submit a limit order, where they can specify the price for their order execution, but the order will not be executed unless the market price meets their set price. When looking at our order book, you can see the highest bid (highest price someone is willing to pay for an asset) and lowest ask (lowest price someone is willing to sell an asset). When a bid and an ask meet at the same price, a trade is executed.
USDC or USD Coin is a stable coin backed 1:1 by US dollars from the Centre consortium. USDC is constantly monitored and audited to ensure that every USDC is backed by a dollar. At Rubicon, we see USDC as one of the best and most secure means of representing a dollar on-chain. This security and reliability led our team to focus on USDC as one of the primary quote currencies for Rubicon. If you want to acquire USDC, you can purchase it in our app through our integrated fiat on-ramp, powered by Ramp.
Ethereum has transaction fees (gas fees) for sending a transaction on the network. These fees are paid in units of ether commonly referred to as “gwei”. To view current gas prices you can check out ETH Gas Station. On Rubicon, these gas costs are greatly reduced by using layer 2 solutions. We encourage you to read more on your own about gas so you have an understanding of these fees, but this article is a good starting point. Additionally, Rubicon has variable protocol fees, currently set to zero fees on maker trades and a 0.2% fee on taker trades. The fee is taken in whatever asset the user is trading. If you are still having trouble with your transaction, please send a message in the Support channel on our Discord server.
Every transaction on Ethereum must be hashed by miners in order to be completed (on Optimism, your transaction must be processed by the Sequencer). If your transaction is stuck, there is a good chance it has to do with the gas price associated with the transaction. Gas prices may have quickly shifted from the time when you submitted your transaction, and your transaction will not get hashed until either the gas prices come back down, you submit a transaction to speed it up, or you submit an order to cancel. Here is a well-written explanation on how to speed up or cancel your transaction using the MetaMask wallet. Make sure you fully understand how to set your transaction gas price before submitting any orders.
The Rubicon protocol is permissionless, so it is compatible with any ERC-20 token. At launch, our application will support high volume, popular token pairs as we build a long-term solution to support the ever-growing number of permissionless assets that does not make sacrifices in user experience or security. We will continue to improve the breadth of our offerings, but our goal is to first establish core features with what we see as the most important pairs. In the interim, send suggestions to [email protected] or tweet at us to let us know what our next pair should be!