Definition ∞ Blockchain order books are decentralized records of buy and sell orders for digital assets, maintained directly on a blockchain. Unlike centralized exchange order books, these systems operate without a single intermediary, with orders submitted as transactions to a smart contract. They list the prices and quantities at which users are willing to trade specific cryptocurrencies or tokens. This structure offers transparency and censorship resistance, as all entries are publicly verifiable on the distributed ledger.
Context ∞ The performance and user experience of blockchain order books remain a central point of discussion, particularly concerning transaction speed and gas fees on congested networks. Many decentralized exchanges (DEXs) utilize various order book models, including automated market makers (AMMs), to address liquidity and efficiency challenges. Ongoing development focuses on scaling solutions and layer-2 protocols to improve the practicality of on-chain order book operations for active trading.
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