What is 0x? (ZRX)

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The 0x protocol is a foundational building block in the decentralized finance (DeFi) ecosystem, enabling seamless and efficient exchange of Ethereum-based digital assets. By combining off-chain order relaying with on-chain settlement, 0x reduces transaction costs and improves trade execution—making it a go-to solution for developers and traders alike. Built on Ethereum and compatible EVM chains, 0x supports both ERC-20 tokens and non-fungible tokens (NFTs), offering a flexible infrastructure for decentralized trading.

At its core, 0x operates as a decentralized exchange (DEX) protocol, but unlike traditional DEXs that post every order directly to the blockchain, it uses a hybrid approach to optimize speed and cost. This makes it especially valuable in environments where gas fees are high or slippage can impact trade outcomes.

👉 Discover how decentralized trading platforms leverage 0x for better liquidity and lower fees.

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How Was 0x Developed?

Launched in 2016 by American entrepreneurs Will Warren and Amir Bandeali, 0x emerged from a vision to create an open standard for peer-to-peer asset exchange on the blockchain. Warren, who studied mechanical engineering and robotics, previously worked with blockchain startups like Basic Attention Token and Brave. Bandeali brought deep financial market experience from his time as a trader at Chopper Trading.

The duo released the 0x whitepaper in February 2017, outlining a new model for decentralized trading using off-chain order relaying and on-chain settlement. In August of that year, they conducted an initial coin offering (ICO), selling 500 million ZRX tokens and raising $24 million. Since then, the project has secured over $85 million in venture capital funding, including a major $70 million round led by Greylock in 2022.

Over the years, 0x has evolved significantly. A key milestone came in January 2023 when version 4 (v4) of the protocol was approved by more than 2,300 ZRX token holders through community governance. This update introduced advanced DEX aggregation capabilities, further enhancing liquidity sourcing and trade efficiency across multiple platforms.

How Does 0x Work?

The 0x protocol runs on audited smart contracts deployed across Ethereum, layer 2 solutions like Optimism, and other EVM-compatible blockchains such as Avalanche and Fantom. Its architecture is designed to minimize gas costs while maximizing trading performance.

Makers and Takers

Two primary roles define the 0x ecosystem:

This maker-taker model enables efficient price discovery without requiring constant on-chain activity.

Trade Execution: Off-Chain Relay, On-Chain Settlement

To reduce blockchain congestion and gas fees, 0x employs a system known as off-chain relay and on-chain settlement:

  1. A Maker creates an order off-chain, specifying what they want to trade and at what price.
  2. A Taker discovers this order through an API or interface like Matcha.
  3. If the terms match, the Taker submits the trade to the blockchain for final settlement.

Only the final transaction occurs on-chain, drastically cutting costs and improving scalability. Importantly, 0x aggregates liquidity from over 100 sources—including Uniswap and Curve—ensuring users get the best available prices with minimal slippage.

👉 See how developers integrate 0x’s Swap API for optimal cross-DEX trading performance.

The 0x Product Suite

0x offers a range of developer-focused tools that power decentralized applications across the Web3 landscape:

These tools have empowered builders to create everything from decentralized exchanges and wallets to derivatives platforms and NFT marketplaces.

How Is the ZRX Token Used?

ZRX is the native utility and governance token of the 0x protocol. It plays two critical roles:

  1. Governance: ZRX holders can propose and vote on upgrades, fee models, treasury allocations, and other protocol changes.
  2. Relayer Incentives: Although less prominent today due to evolving usage patterns, ZRX was originally used to reward relayers—entities that host and broadcast order books.

While direct rewards for relayers have diminished with newer versions of the protocol, governance remains a central function of ZRX, ensuring decentralized control over the protocol’s future.

Token Distribution

At launch, the total supply of ZRX was capped at 1 billion tokens:

This structured distribution helped ensure long-term sustainability while aligning incentives across stakeholders.

Frequently Asked Questions

What is the main advantage of using 0x over other DEX protocols?

0x stands out due to its hybrid off-chain/on-chain architecture, which reduces gas fees and minimizes slippage. Its robust liquidity aggregation from over 100 sources ensures users receive optimal pricing across trades.

Can I trade NFTs using the 0x protocol?

Yes. The NFT Swap SDK enables developers to build multi-chain NFT trading functionality into their applications, supporting secure peer-to-peer NFT exchanges.

Is ZRX used for paying transaction fees?

No. ZRX is not used to pay gas fees on Ethereum or other chains. Instead, it serves primarily as a governance token for voting on protocol improvements.

On which blockchains does 0x operate?

0x runs on Ethereum, multiple layer 2 networks (like Optimism and Arbitrum), and various EVM-compatible chains including Polygon, Avalanche, Fantom, and BNB Chain.

How does Matcha relate to 0x?

Matcha is a consumer-facing product built by the 0x team. It uses the protocol’s Swap API to offer users the best possible prices by routing trades across multiple DEXes.

Is 0x safe to use?

Yes. The protocol uses thoroughly audited smart contracts and has undergone numerous security reviews. Additionally, its open-source nature allows continuous community scrutiny.

0x Essentials

👉 Explore how top dApps use 0x for smarter, cheaper token swaps across chains.