About Hanji

What is Hanji?

Hanji is a fully on-chain order book exchange on Etherlink. All orders are placed and matched on-chain, making it fully decentralized, transparent, and composable.

Hanji will initially launch as a spot decentralized order book exchange on Etherlink. Later, perpetual trading will be introduced, and LP tokens will be launched to enable passive liquidity provisioning.

Why Hanji?

While the on-chain DEX market is dominated by AMMs, we believe that the CLOB model is superior. This is because it offers price-time priority for orders, which creates competition between liquidity providers and allows CLOB DEXes to offer tighter spreads compared to AMMs.

There are two main reasons CLOBs are not widely used on-chain yet: first, most widely known matching algorithms are not suitable for on-chain execution as they have linear complexity and can breach gas limits per block or per contract call. The second reason is that gas fees are still quite expensive on most chains.

Hanji's matching algorithm addresses the first issue by having logarithmic complexity in the number of orders, effectively allowing matching in a fixed number of steps. The second issue is mostly addressed with advancements in blockchain infrastructure. For instance, gas costs on Etherlink would allow transaction costs of below 0.2 cents on Hanji.