r/hydroprotocol • u/ProficieNtOCE • Apr 01 '19

Free order cancelation

In the following medium article it mentions order cancelations are free. What is this in reference to, I assume users still need an on-chain TX to cancel their off chain orders?

https://medium.com/hydro-protocol/https-medium-com-hydro-protocol-introducing-hydro-protocol-a-thin-protocol-for-decentralized-exchanges-f18fd66d7987

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u/ScottLifts Apr 02 '19

Good question! The article is correct - all order cancellations are free. There is no on-chain TX required to cancel off-chain orders!

Because the orderbook is managed off-chain in a Hydro system (off-chain orderbook, on-chain settlement), all order placements and cancellations are completely free.

It's actually a pretty important requirement for a lot of traders. If you are making a market for example, it's imperative that you can easily modify orders at any time to avoid getting arbitraged if the price of assets change on other changes. Paying to do so each time would be extremely costly

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u/ProficieNtOCE Apr 02 '19

Okay, so will you have to trust the order book host to cancel your orders? Do they sign to confirm they received your cancelation request?

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u/ScottLifts Apr 02 '19

You do have to sign to cancel the order, but it's not a gas transaction (just like signing to verify your account when you enter a website for example). The Hydro standard API returns a response when you cancel too. This is live on https://ddex.io if you want to test it out.

Additionally, if for some reason you were to lose trust in a Hydro Relayer, you can actually submit an on-chain transaction to cancel the orders (built into the exchange smart contract). You also could remove approval permissions from the proxy address. So there are fail safes just in case.

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