About Lambdaplex

What is Lambdaplex?

Lambdaplex is a Hedera-native onchain cryptocurrency exchange protocol, built for high throughput, low latency, and ultra low fees. The Lambdaplex protocol leverages Hiero Hooks for decentralized order placement, trade approvals, and self-custody. Lambdaplex Labs observes the blockstream and provides a matching service as an order book on the Hedera network.

Technical Overview

Lambdaplex is an order placement and authorization protocol built on the Hedera network. Lambdaplex orders may be filled or matched by any third party broker, encouraging competition on swap fees and latency. This is accomplished by allowing traders to approve allowances for outcomes rather than to a specific broker or smart contract; instead of approving a smart contract to transfer tokens, traders approve any entity to transfer tokens from their account as long as the trade conditions are fully met.

Traders are required to install the Lambdaplex hook to their accounts. The Lambdaplex hook acts as a smart contract on behalf of the installer. Any account on the network may invoke the hook, but only the installer may write to its storage slots. Traders store encoded order bytes to their installed hooks, and the hook decodes and authorizes valid trade proposals without any further signatures or input from the trader.

Here's an example: suppose Alice wants to trade 100 USDC for 100 HBAR. She writes an order to her Lambdaplex hook which encodes the tokens to be traded, trade direction, quantity, and exchange rate. If Bob sees this order and wishes to partially or fully fill Alice's order, he may do so himself, or he may join Alice with a counterparty that wants to trade HBAR for USDC at or better than her 1:1 exchange rate. If Bob attempts to give Alice less than 100 HBAR for her 100 USDC, the hook rejects the transfer and no tokens are traded.

Lambdaplex supports the following order types: limit, market, stop_limit, stop_market, take_profit_limit, and take_profit_market.

For stop and take_profit orders, the Lambdaplex hook reaches out to Hedera Smart Contract Service (HSCS) with oracle proof bytes args to get the current oracle price of asset pairs. The hook calculates whether the trigger price has been reached and approves or denies the trade accordingly.