Developing a Currency Trading Exchange for Market Making

This chapter extends the idea of a decentralized exchange from the previous chapter and shows you how to build a market maker. Market makers are intermediaries that facilitate cross-border and cross-currency transactions, by allowing remittors to convert the remitting amount into a different currency. Let's say you are working in Europe and want to remit money back to your family in India: a market maker will convert the remitting amount into Indian Rupees (INR) from Euros (EUR). Market makers are interesting, in the context of decentralized payment and remittance networks (such as Stellar and Ripple), because these networks gather the exchange rates from all the market makers on the network and allow the remittor to view them in a single platform. This platform is called the distributed exchange. This promotes competitive...