---
title: "Decentralized Exchange (x/dex)"
sidebarTitle: "Interchain Exchange"
icon: "coins"
tag: "x/dex"
description: "Cross-chain trading through IBC Interchain Accounts with DID-based authorization"
---

import { Card, CardGrid } from '@/components/mdx'
import { Tabs, Tab } from '@/components/mdx'
import { Accordion, AccordionItem } from '@/components/mdx'
import { CodeGroup } from '@/components/mdx'
import { Info } from '@/components/mdx'

# Sonr DEX Module

The Sonr Decentralized Exchange (DEX) module provides a powerful cross-chain trading infrastructure that enables seamless, secure, and self-sovereign trading across the Cosmos ecosystem.

## Overview

<CardGrid>
  <Card title="Cross-Chain Trading" icon="swap">
    Execute swaps on remote DEX chains via Interchain Accounts (ICA)
  </Card>
  <Card title="Liquidity Management" icon="wallet">
    Add and remove liquidity from pools across chains
  </Card>
  <Card title="DID-Controlled Accounts" icon="key">
    All operations authorized through Sonr DIDs
  </Card>
  <Card title="Multi-DEX Support" icon="globe">
    Connect to multiple DEX chains simultaneously
  </Card>
</CardGrid>

## Core Concepts

<Accordion>
  <AccordionItem title="Interchain Accounts (ICA)">
    The module leverages IBC's Interchain Accounts to create controlled accounts on remote DEX chains. Each account is linked to a Sonr DID and managed through ICA transactions.
  </AccordionItem>
  
  <AccordionItem title="DID-Based Authorization">
    All DEX operations require authorization from a valid Sonr DID, ensuring that only authenticated users can perform trading operations.
  </AccordionItem>
  
  <AccordionItem title="UCAN Tokens">
    User-Controlled Authorization Network (UCAN) tokens provide delegated authority for specific operations, enabling secure third-party integrations.
  </AccordionItem>
</Accordion>

## Trading Operations

<Tabs>
  <Tab title="Swaps">
    <CodeGroup>
      ```bash
      # Execute a swap on Osmosis
      snrd tx dex swap \
        --did did:sonr:alice \
        --connection connection-0 \
        --source-denom uosmo \
        --target-denom uatom \
        --amount 1000000 \
        --min-amount-out 950000 \
        --ucan-token "eyJ0eXAiOi..." \
        --from alice
      ```
    </CodeGroup>
    
    <Info>
      Swap operations are protected against slippage with `min-amount-out` parameter.
    </Info>
  </Tab>
  
  <Tab title="Liquidity">
    <CodeGroup>
      ```bash
      # Provide liquidity to a pool
      snrd tx dex provide-liquidity \
        --did did:sonr:alice \
        --connection connection-0 \
        --pool-id 1 \
        --assets 1000000uosmo,500000uatom \
        --min-shares 100000 \
        --ucan-token "eyJ0eXAiOi..." \
        --from alice
      ```
    </CodeGroup>
    
    <Info>
      Liquidity providers receive LP tokens proportional to their contribution.
    </Info>
  </Tab>
  
  <Tab title="Orders">
    <CodeGroup>
      ```bash
      # Create a limit order
      snrd tx dex create-order \
        --did did:sonr:alice \
        --connection connection-0 \
        --sell-denom uosmo \
        --buy-denom uatom \
        --amount 1000000 \
        --price 1.2 \
        --expiration "2024-12-31T23:59:59Z" \
        --ucan-token "eyJ0eXAiOi..." \
        --from alice
      ```
    </CodeGroup>
    
    <Info>
      Limit orders can be created with precise price and expiration settings.
    </Info>
  </Tab>
</Tabs>

## Security and Performance

<CardGrid>
  <Card title="DID Authentication" icon="shield">
    All operations require valid DID signatures
  </Card>
  <Card title="Rate Limiting" icon="lock">
    Protects against spam and DoS attacks
  </Card>
  <Card title="UCAN Authorization" icon="key">
    Fine-grained permissions prevent unauthorized operations
  </Card>
  <Card title="Batch Operations" icon="rocket">
    Multiple operations can be executed in a single transaction
  </Card>
</CardGrid>

## Supported DEX Chains

### Currently Supported
- **Osmosis**: Full swap, liquidity, and order support
- **Crescent**: Swap and liquidity operations
- **Neutron**: Astroport DEX integration

### Planned Support
- **Kujira**: FIN orderbook integration
- **Injective**: Derivatives and spot trading
- **Sei**: High-frequency trading support

## Future Enhancements

<Accordion>
  <AccordionItem title="Advanced Trading Features">
    - Advanced Order Types (stop-loss, trailing stops)
    - Cross-Chain Arbitrage
    - Portfolio Management
    - Yield Farming Integration
  </AccordionItem>
  
  <AccordionItem title="DeFi Innovations">
    - Derivatives Trading
    - MEV Protection
    - Analytics Dashboard
    - Social Trading Features
  </AccordionItem>
</Accordion>

## Technical Details

<Tabs>
  <Tab title="Protobuf Definitions">
    ```protobuf
    message MsgExecuteSwap {
      string did = 1;                  // DID initiating the swap
      string connection_id = 2;        // IBC connection to DEX chain
      string source_denom = 3;         // Token to swap from
      string target_denom = 4;         // Token to swap to
      string amount = 5;                // Amount to swap
      string min_amount_out = 6;       // Minimum amount out (slippage protection)
    }
    ```
  </Tab>
  
  <Tab title="Rate Limiting">
    ```go
    // Per-block rate limiting
    if opsThisBlock >= params.RateLimits.MaxOpsPerBlock {
        return errorsmod.Wrap(ErrRateLimited, "max operations per block exceeded")
    }
    ```
  </Tab>
</Tabs>

## Getting Started

### Integration Guide

1. **Account Setup**: Register ICA accounts for target DEX chains
2. **Permission Management**: Issue UCAN tokens for specific operations
3. **Execute Trades**: Use the module's messages to perform DEX operations
4. **Monitor Activity**: Subscribe to events for real-time updates
5. **Query State**: Use queries to display balances and history

## Development

<CodeGroup>
  ```bash
  # Run unit tests
  make test-dex

  # Run integration tests with IBC
  make test-dex-ibc

  # Start local chain with ICA enabled
  make localnet-dex
  ```
</CodeGroup>