Account Abstraction is paving the way for Web3 adoption.

In recent years, we have witnessed the flourishing and evolution of Web3 applications such as DeFi (decentralized finance), NFTs (non-fungible tokens), DAOs (decentralized autonomous organizations), and GameFi (game finance). These developments reveal a trend: each stage of Web3 development engages a broader user group, extending from finance and technology to culture and art, games and entertainment, social organizations, and other fields.

In 2023, the focus of the crypto industry has shifted towards realizing large-scale adoption of Web3. Consequently, lowering the entry barriers to Web3 has become an urgent issue that developers need to address. In the Web2 era, users only needed to register an account to access any platform. However, in the Web3 world, high gas fees, obscure industry terminology, poor user experience, and relentless security issues all increase the cost for users entering Web3. For example, transferring transactions, which are relatively simple in Web2, require users to learn how to create an encrypted "wallet" and securely store mnemonic phrases and private keys in Web3. Creating a wallet is just the beginning; navigating the crypto world with a wallet is even more dangerous and complex. Simply figuring out how to send USDC from one address to another can be frustrating, and more complex needs involve switching and interacting between various DApps or protocols. On-chain interaction carries inherent risks, and transitioning between different applications further increases the likelihood of being attacked.

Thankfully, account abstraction is transforming the way users interact with Web3. Account abstraction is a new feature in Ethereum (implemented via EIP-4337) that allows users to execute transactions and engage with the blockchain in an experience reminiscent of Web2. By introducing a Web2-like user experience to Web3, account abstraction revolutionizes the crypto industry, simplifying the onboarding process for new users and making it easier for them to access and utilize Web3 services.

Several crypto projects are leveraging account abstraction to bring the Web2 experience to the public, with the decentralized derivatives exchange MUFEX being one notable example. By integrating account abstraction, platforms like MUFEX can help accelerate the mass adoption of Web3, ultimately bridging the gap between traditional internet users and the decentralized world of blockchain technology.

Introducing MUFEX: A User-Friendly Decentralized Perpetual Contract Exchange

MUFEX is a decentralized perpetual contract exchange that aims to provide users with a simple and user-friendly experience, similar to that of centralized exchanges (CEXs). The name itself, MUFEX, stands for the "Most User-Friendly EXchange," highlighting the platform's goal of reducing entry barriers to the cryptocurrency market.

In April of this year, MUFEX introduced its testnet alpha as a closed beta version. Following this, on May 15th, MUFEX launched its test network and incorporated multi-chain support. As of June 12, approximately 4,900 users participated in the testnet, boasting an open interest of over $70 million and a total transaction volume exceeding $92 billion. According to official announcements, MUFEX is set to officially launch its mainnet on the Arbitrum blockchain on June 15th.

By focusing on a user-friendly experience and bridging the gap between centralized and decentralized exchanges, MUFEX has the potential to attract a broader user base and promote the adoption of decentralized finance within the cryptocurrency market.

MUFEX's Core Mechanism

MUFEX leverages advanced technologies, such as account abstraction and ZK-Rollup, adopts a hybrid model that combines order books and liquidity pools, and offers leverage of up to 150 times. This approach provides users with a simpler, more efficient, and cost-effective trading experience.

Web3 requires a breakthrough, not just competition within its existing ecosystem. The growth rate of users is slow, primarily focusing on competing for the attention of current users. To quickly break through and reach a broader Web2 audience, it is crucial to lower the entry barriers of Web3.

Account abstraction is the ideal solution for connecting Web2 and Web3 digital identities and is essential for large-scale Web3 applications. Ethereum features two types of accounts: Externally Owned Accounts (EOAs) and Contract Accounts (CAs). EOAs are controlled by the user's private key, while CAs are controlled by contract code stored in the smart contract account. Account abstraction is a proposal that elevates contract accounts to the same "top-level" status as external accounts, allowing users to interact directly with the blockchain in the same way as Web2, without managing mnemonic phrases or private keys. Simultaneously, it enables features like multi-signature security, social wallet-based recovery, payment limits, address black/white lists, and free meta-transactions.

Utilizing account abstraction technology, MUFEX lowers the barrier for trading cryptocurrencies while offering a more straightforward and user-friendly account system. Users can choose to connect their existing crypto wallets to log in or use traditional Web2 methods such as email or Google accounts.

on Decentralized ExchangesOne of the significant challenges that decentralized exchanges (DEXs) face is providing sufficient liquidity. Various platforms offer solutions in different directions to improve liquidity in the on-chain derivatives trading market. This article will explore some representative examples and introduce a hybrid transaction model that combines an Order Book and a liquidity pool to enhance liquidity on decentralized exchanges.

The Examples:

- dYdX: dYdX adopts the traditional Order Book system and provides liquidity through market makers instead of the Automated Market Maker (AMM) model. Market makers provide liquidity by buying when the market is oversupplied and selling when the market is undersupplied.

- Perpetual: Perpetual Protocol (PERP) uses a Virtual Automated Market Maker (vAMM) model to improve liquidity. PERP allows users to trade in virtual liquidity pools using USDC, which achieves more convenient liquidity entry and exit while avoiding impermanent losses. PERP also uses capital pool leverage to increase liquidity, which further improves liquidity.

- GMX: GMX introduces the GLP (Governance LP) index token to provide liquidity through a liquidity pool composed of ETH, WBTC, USDC, USDT, and other basic assets in a certain proportion. The liquidity pool on the GMX platform can be regarded as a fund, and GLP is the share of the fund. When users deposit GMX-backed underlying assets, these assets become liquidity providers for counterparties across the GMX platform.

- Rage Trade: Rage Trade uses a mechanism called "full chain recyclable liquidity" to integrate liquidity on the chain. It allows all existing liquidity in other agreements to enter the project's ETH perpetual contract liquidity pool, including AMM, Money Market, and ETH-USD LP in derivatives agreements.

The above strategies have their advantages and potential risks. MUFEX's hybrid transaction model combines the benefits of an Order Book and a liquidity pool. It aggregates multi-chain assets while supporting MLP passive market making and market maker active market making at the same time. MUFEX balances the interest relationship between traders and LPs, allowing liquidity contributors to get more returns. MUFEX also introduces more insurance pools to reduce liquidity providers' risks under extreme market conditions and provides multi-chain support, which enriches the access channels of liquidity providers and improves the utilization of multi-chain assets.

MUFEX's trading system adopts off-chain contracts and matching engines to improve user trading experience. The platform offers high leverage and low gas fees, which provides traders with more trading options while reducing transaction costs.

MUFEX's matching engine can process up to 100,000 transactions per second (TPS), with a P99 latency of less than 10 milliseconds. This high-efficiency engine reduces latency and enables instant order execution, which significantly improves the user trading experience.

MUFEX supports leverage of up to 150 times, which is a significant advantage for most derivatives traders. Typically, DEX platforms struggle to provide high-leverage products due to the price delay of the oracle machine, which limits the trading options for users. With MUFEX's high-leverage support, traders can engage in more diverse trading strategies and potentially increase their profits.

MUFEX uses ZK-Rollup technology to achieve high throughput and low gas fees. With ZK-Rollup, user transactions are batched off-chain by MUFEX, attested by the ZK service, and then sent on-chain. This process ensures 100% transparency and verifiability of user transactions while significantly reducing stress on the Ethereum network. As a result, users can save on transaction costs and enjoy a more affordable trading experience.

Ensuring User Asset Security with Multiple Protection Mechanisms on MUFEX

MUFEX places a high priority on user asset security and has implemented various protection mechanisms to safeguard user accounts, data, smart contracts, and organizational internal security risks. This article will discuss how MUFEX ensures the security of user assets through multiple security protection mechanisms.

MUFEX integrates various security products to protect user account security, including two-factor authentication, offline account risk control, single login, anti-replay attack, and anti-malicious email attack measures. Additionally, MUFEX does not store or record information related to the user's private key at any stage, and all sensitive data is encrypted and signed before storage. User-related data is highly confidential, and unauthorized access triggers an alarm. These protection mechanisms reduce the risk of malicious registration and user login credential theft.

MUFEX places a strong emphasis on smart contract security. All MUFEX smart contracts and their security audit results are open to users. Real-time smart contract security monitoring scan results will also be made public to users in the future. MUFEX has invited multiple security vendors to conduct security audits and only deploys smart contracts that pass the security audit and have no security risks. MUFEX also uses smart contracts on the chain to monitor security products, enabling real-time risk identification during smart contract transactions. The platform's Bug Bounty program encourages users to report potential security risks.

MUFEX recognizes that internal risks can also pose a significant threat to user assets. Therefore, the platform has strengthened its internal risk control management by regularly conducting security awareness training for employees and ensuring that they meet endpoint security standards before entering the workspace. The MUFEX team comprises experienced developers and security personnel, and the platform prioritizes transparency and identity verification to increase user confidence in the platform.

MUFEX Roadmap

MUFEX plans to conduct a Dunkirk asset recovery test in mid-July, providing an opportunity to identify and recover lost assets. Additionally, at the end of July, MUFEX will launch asset certification on the mainnet, allowing users to certify their assets on the blockchain, ensuring their ownership and authenticity. MUFEX is also introducing one-click transactions in Lite mode, providing a seamless transaction experience for users and increasing efficiency. The platform will also launch multi-pool mining via MLP, allowing users to mine multiple cryptocurrencies simultaneously and earn rewards from multiple pools.\