Jack Dorsey, co-founder and CEO of both Square and Twitter, released a white newspaper Friday detailing plans for Square's decentralized Bitcoin (BTC) commutation tbDEX. Unlike about decentralized exchanges, or DEXs, tbDEX will not employ a trustless model, and therefore volition not feature its own governance token. Instead, it is a message protocol designed to facilitate trust relationships without relying on a federation to control access.

The tbDEX also intends to include many features that make information technology far less decentralized than a DEX in the truest sense of the discussion. For starters, the protocol requires that all participants pass background and Know Your Customer, or KYC, checks to comply with relevant regulations, depending on a user'due south region. Users can only and so connect their wallets to the exchange and swap coins with one another.

Furthermore, the white paper chosen for the deployment of blockchain analytic solutions, either congenital-in to the DEX or through a third political party, to track transactions on the platform. Such a class of blockchain forensic solutions is potentially a controversial topic. Such a system would probable enable regime to cross-reference payment IDs and public wallet addresses with KYC information to unveil personal identities behind transacting parties. However, supporters merits that such means of monitoring are necessary to prevent illicit activities.

But centralized features of the tbDEX could too win support from crypto enthusiasts. One distinguishing aspect discussed in the white paper is that of chargebacks, which doesn't exist on most DEXs. If implemented, the ability for Square to opposite transactions on the tbDEX could potentially stop irreversible loss suffered by investors during decentralized finance rug pulls. Square is currently encouraging feedback on the white newspaper on a newly-created Twitter business relationship.