Education
Learn about RUJI Trade and why it is a powerful addition to the Rujira ecosystem.
Team Rujira
5
min read
·
Jun 4, 2025
TABLE OF CONTENTS
INTRODUCTION
THORChain has rolled out chain upgrade v3.6.0, paving the way for Rujira, THORChain’s application layer, to kick off. At Rujira, we are extremely excited to ship one of our core products: RUJI Trade. RUJI Trade boasts a variety of exciting features, however, at its core, it’s a decentralized fully on-chain orderbook exchange that allows users to buy and sell crypto assets in a variety of ways.
We have already released RUJI Swap, an application allowing users to swap between various native crypto assets using market orders. RUJI Trade offers a more advanced counterpart to RUJI Swap, providing more control and opportunities to build custom strategies. Trade offers not only market orders but also more advanced order types including limit and oracle orders. RUJI Trade’s more advanced order types give users greater flexibility to cut down on trading fees and customize various aspects of the trading process. We will break down these different types of orders later on.
WHAT IS RUJI TRADE
RUJI Trade is a decentralized orderbook exchange that allows users to buy and sell their crypto assets in a variety of convenient, strategic, and customizable ways. Before we can get further into the weeds, it is necessary to explain what an orderbook actually is and how it works.
WHAT IS AN ORDERBOOK AND HOW TO USE IT
To provide some important context: a decentralized orderbook is a trading mechanism that uses its underlying smart contracts to facilitate peer-to-peer trading that doesn’t rely on a centralized server. Furthermore, smart contracts are self-executing agreements written in code that automatically enforces the terms of the trade.
A fully on-chain decentralized orderbook (like RUJI Trade) allows users to place buy and sell orders directly on a blockchain. The orderbook matches these orders based on price and quantity. When a matching buy and sell order is found, the smart contract automatically transfers the assets between the buyer and seller (for a small fee), ensuring a secure and transparent transaction.
Decentralized systems have no central authority. Therefore, users are able to maintain custody over their funds, audit orderbook transactions on the blockchain (after the fact), and crucially avoid manipulation of orderflow. In traditional finance, because most systems are centralized, for the sake of convenience and longevity—through backdoor deals–large ‘trusted’ market makers always have special early access to order flow. These market makers are able to use this information to predict local trading movements in advance and actively trade against incoming orders to profit from price movements on both the buy and sell side.
Decentralized exchanges make trading fairer for everyone by allowing for direct trading (without the need for ‘trusted’ centralized intermediaries) for a small percentage of every trade executed on them. RUJI Trade in particular is open-source and fully on-chain, unlike other decentralized exchanges that purport to increase efficiency by converting part of their orderflow off-chain. Users can track every transaction between any parties on any trading pair on the exchange at any time.
As a recap, RUJI Trade is a peer-to-peer decentralized marketplace for users that want to buy or sell various cryptocurrencies to each other. Users are able to choose between three different types of orders and customize various aspects of the trading process for a small fee on every trade. Once created, users orders are then matched based on asset type, price, and quantity.
ORDERBOOK LIQUIDITY
We will explain liquidity more in depth in our RUJI Pools article, but here is a brief primer to help illustrate how orderbooks work. In general, an asset’s market liquidity refers to how easy it is to buy or sell that asset at a fair value (i.e. without incurring large price movements). Prospective buyers want to buy assets as cheap as possible and prospective sellers want to sell assets as high priced as possible. In a liquid orderbook market, this eventually results in a middle ground where the lowest sell orders (ask price) are priced close to the highest buy orders (bid price).
In general, markets are made up of makers and takers. Makers create buying or selling orders of assets at specific quantities and prices that are not carried out immediately (for example, “sell 0.5 BTC when the price hits $115,783” or “buy $2000 worth of BTC when the BTC price touches $104,359”). A grouping of many such buy and sell orders for the same assets in one place creates orderbook liquidity–making it easier to instantly buy and sell BTC when the conditions (of any of the orders) are met. Market players that buy or sell instantly (into existing orderbook liquidity) are called ‘takers’--takers ‘take’ liquidity away from the orderbook by filling the orders created by the makers. Orderbooks benefit more from liquidity so RUJI Trade charges lower trading fees on orders that add liquidity.
The important lesson here is that anyone can add liquidity to an orderbook at any price and quantity–but removing liquidity from an orderbook only happens when buy and sell orders are matched together at the same prices (although the overall asset amounts of those orders can differ), or when a user retracts the order.
HOW RUJI TRADE SOURCES LIQUIDITY
In decentralized finance, it is common for automated market makers (AMMs), bots, and other entities to create liquidity for trading pairs to keep markets liquid. However, it is rare for decentralized exchanges to rely on more than one source of liquidity. RUJI Trade provides a sleek user experience precisely by doing this. Trade pulls liquidity from a variety of sources and seamlessly combines it all in one place directly accessible via our chic user interface.
RUJI Trade sources liquidity in two different ways:
Manual Method
Humans/AI manually place limit or oracle orders in the RUJI Trade orderbook. This is similar to what we outlined above. In this case, there is organic demand for or supply of an asset at various prices from a group of people/AI agents.
AMM Method
A) RUJI Pools–Rujira’s AMM–creates orders based on systematic underlying rules for each trading pair that are detailed in its smart contract. RUJI Pools allows users to create a variety of precise strategies to add liquidity in various ways to RUJI Trade pairs (for the purpose of making profit). We explain this in more detail in the RUJI Pools article.
B) RUJI Trade also sources liquidity from THORChain’s base layer via a custom AMM strategy using ultra short-term borrowing (1 block = ~6 second) and an arbitrage mechanism to virtualize the liquidity of the base layer pools. This means RUJI Trade can tap into the liquidity that THORChain itself sources from all of the connected chains. We explain this further in our RUJI Pools article.
DIFFERENT ORDER TYPES
One of the conveniences of RUJI Trade as a decentralized exchange is that it allows for different types of trading orders depending on user preference. These three types of orders each have their own advantages and weaknesses. Mastering the differences between the three order types will allow you to make the most of reducing trading fees, trading assets at better prices, and offering greater flexibility.
MARKET ORDER
The first type of order RUJI Trade enables is called a market order. Market orders allow users to instantly buy or sell assets at the best available price (i.e. the ask or bid price). They are executed based on the existing liquidity in an orderbook (i.e. buy or sell orders at various prices and amounts).
Market orders are executed in full right away. This means that if the amount requested (to be sold or bought) by a market order exceeds the existing liquidity (being bought or sold) at the lowest or highest available price, then after filling part of the order at those best available prices, it will then move on the next best priced order and fill as much of it as possible, and continue onwards from there to the next order (and so on) if the market order still has not been fully filled.
Market orders are convenient when the priority is getting an order filled quickly rather than achieving a better price. Since market orders remove orderbook liquidity, RUJI Trade charges higher fees on market orders (a 0.15% “taker” fee). Furthermore, executed prices depend on existing orderbook liquidity, so they should only be used to buy or sell as quickly as possible, regardless of price and fees.
Example A: Alice wants to buy $10,000 of BTC. The orderbook has existing sell orders for BTC from Bob of $4,000 BTC at $100,000, from Carlos of $5,000 BTC at $100,500, and from Darren of $2,000 BTC at $101,000 (plus other higher sell orders that aren’t relevant to this example.
Say Alice decides to do a market buy for that $10,000 of BTC. The best price to buy BTC in the market comes from Bob’s order, so Alice purchases $4,000 of Bob’s order at a rate of $100,000 per BTC–however, Alice still has $6,000 left to spend on her market order, so the order continues. Next, Alice purchases $5,000 of Carlos’s order at a rate of $100,500 per BTC–she still has some money leftover. Finally, Alice purchases $1,000 (i.e. half) of Darren’s $2,000 BTC order at $101,000.
So Alice manages to buy 0.04 BTC from Bob for $4,000, 0.04975 BTC from Carlos for $5,000, and 0.0099 BTC from Darren for $1,000, spending $10,000 for 0.09965 BTC overall before the 15 bps taker fee (0.000149475 BTC). Net of fees, Alice received ~0.09950 BTC at an average net execution price of ~$100,502.
Explanation: For the sake of filling her order as quickly as possible Alice chose to pay slightly higher fees on her transaction and fill part of her buy order at prices above the lowest current available market price. However, in preparing for the case that Bitcoin may suddenly see price movements to the upside–Alice can rest assured that she has already secured her BTC in advance before any new developments have been accounted for.
RUJI Trade maintains fairness for all users regardless of the size of their pockets. All orders at a certain price are filled in proportionally at the same time. Here is an example of how this works.
Example B: Alice wants to buy $10,000 of BTC. The orderbook has existing sell orders for BTC from Bob of $5,000 BTC at $100,000, from Carlos of $7,000 BTC at $100,000, and from Darren of $200 BTC at $100,000 (plus other higher sell orders that aren’t relevant to this example).
Say Alice decides to execute a market buy for that $10,000 of BTC. The RUJI Trade orderbook for the BTC/USDC pair would then have 3 orders (with an aggregate sum of over $10,000 worth of BTC to buy into) coming from 3 different people. How does the RUJI Trade exchange decide how much of each person’s order gets filled when executing Alice’s market order? Unique to RUJI Trade, each existing order at a certain price gets filled at the same relative proportion.
In the above example, the orders of Bob, Carlos, and Darren total together to $12,200 in BTC being sold at $100,000 per BTC. Alice wants to only buy $10,000 worth of BTC. So each order will be filled at a relative amount proportional to 10,000/12,200 of their total or approximately 81.967%. So Alice buys $5,000*81.967% = $4,098.3607 of Bob’s $5,000 sell order, $7,000*81.967% = $5,737.7049 of Carl’s $7,000 sell order, and $200*81.967% = $163.9344 of Carl’s $200 sell order as RUJI trade executes her $10,000 BTC market buy order.
Explanation: In this scenario, all existing orders in the orderbook that were created at the same price are able to sell (or fill) the same proportional amount of their overall quantity. RUJI Trade boasts this exclusive mechanism which ensures that, at a given price level, everyone gets filled fairly, without any discrimination based on size or speed of execution.
LIMIT ORDER
The second type of order RUJI Trade offers is called a limit order. Limit orders are orders placed on an orderbook with a specific ‘limit price’ that you choose. Limit orders are only executed if (and when) the market price reaches your limit price (or higher for a sell order / lower for a buy order). Limit orders are useful for more patient buyers or sellers who hope to buy assets at a lower price or sell assets at a higher price than the current market price.
Unless the orderbook already has existing (liquidity with) orders at sufficient price and quantity to fill the limit order, a limit order will not (fully) execute immediately and will (at least partially) add liquidity to the orderbook as a maker order (resulting in RUJI Trade charging lower fees of 0.075%).
Limit orders are useful when tracking the orderbook to find out exactly how much of an asset can be bought or sold and at what prices to do the equivalent of a market order OR to patiently place an order to buy or sell an asset below or above the current market price at a later time. Limit orders can be useful when you have information or insight into where a token price might move in the short or medium term (e.g. there is a planned token unlock in X weeks, so fear will lead to a lower price or e.g. Trump tariffs will be backtracked soon resulting in greed and higher asset prices). Maker orders (limit orders that don’t execute immediately) have the added benefit of lower fees and guaranteed price execution–although their downside is that they are conditional on the market actually reaching the stipulated price. In the worst case that the market never reaches that price and the asset either crazily rises or plunges before you are able to buy or sell–you will be stuck either having never bought or sold the asset.
Example: Alice and Bob each want to buy $10,000 of BTC below the current market price of $104,000 and Carl and Darren each want to sell 0.2 BTC at above the current market price. Alice wants to buy $10,000 of BTC at $100,000 since she thinks it’s a safe round number. Bob wants to buy $10,000 of BTC at $100,150 since he thinks it’s possible that the price of BTC might never reach $100,000–so investors hoping to buy BTC at $100,000 (and who fail to do so) experience fomo when the BTC price goes higher. Carl wants to sell 0.2 BTC at $108,000 since he is hoping for a small gain on his initial investment. Darren is more ambitious and wants to sell 0.2 BTC at $130,000 (but needs to sell his BTC in a month or so for cash to spend on necessary life expenses). The four of them create limit orders to buy those amounts of BTC at those prices.
Over the next few weeks BTC goes down from $104,000 per BTC to $102,000 to $100,100, and then rises from $100,100 to $129,000 per BTC, and finally down from $129,000 to $115,000 per BTC. In this scenario, Bob and Carl are happy because both of their orders are filled entirely at their desired prices (although Carl secretly wishes he waited a week or two longer to sell at a higher price). Meanwhile, Alice and Darren are frustrated. In Alice’s case, her limit order never filled because BTC never reached a price of $100,000 on its way down, and she experienced fomo at a price of $126,000 per BTC (cancelling her limit buy order and using a market buy order at that price for the $10,000 BTC) and now is experiencing a loss on paper and feeling regret that she didn’t just buy BTC manually at a price of $100,500 or $104,000 per BTC. In Darren’s case, he is forced to sell his Bitcoin a month after setting his original limit sell order at a final price of $115,000 per BTC. He is happy that he at least sold at a better price than the original $104,000 per BTC that he could have sold at, but frustrated that he watched the price of BTC tank from $129,000 down to $115,000 before manually cancelling his limit sell order and selling his Bitcoin via a limit sell order at a relatively lower final price.
Explanation: In this scenario, Bob comes out the winner (depending on what he did with the BTC he received after entirely filling his limit order at $100,150) because he has the most flexibility to take the BTC he managed to buy at a low price and sell it at whatever price he wants over the next few weeks when BTC proceeds to go to higher prices. Of course, the scenario could have resulted in vastly different outcomes for the four individuals had the BTC price not gone down at all, gone down lower than it did in the scenario before going back up, gone down without going back up, etc.
Limit orders are ultimately a method to anticipate market movements and profit off them. But the price and quantity they are created at carries part of an inherent risk/reward for accompanying strategy.
ORACLE ORDER
The third type of trade order exclusive to RUJI Trade is a special type of order / trading strategy that Trade automates for the user. Oracle orders allow users to buy or sell assets at a fixed discount/premium to the underlying asset’s oracle price. All oracle orders are maker orders (trade fees are 0.075%) because they add liquidity to the orderbook.
Oracle orders allow you to put assets to work and to quickly buy/sell assets in bulk without affecting asset prices. Arbitrageurs fill open oracle orders to take advantage of the discount/premium below/above the underlying oracle price to profit from the gap.
Case A: Put an unused asset to work
Example: Suppose you are a whale with a bunch of BTC just sitting around that you would like to do something productive with. In that case, you can place an oracle order to sell your Bitcoin at 0.5% above the current oracle price. What this means in practice is that at every block of the blockchain, RUJI Trade will look at the oracle price for BTC, attempt to sell BTC on RUJI Trade at 0.5% above that current BTC price, and as long as there is a buyer who places a sufficiently large buy order (which would move the price up by more than 0.5%) your oracle order will (at least partly) fill in the next block. RUJI Trade is crankless, so you can then turn around and use bots/AI to set up an automated strategy where the proceeds of your oracle order are used to market buy BTC at the current oracle price. Assuming the chart moves sideways, you are able to make a 0.5% profit on completion of the trade.
Explanation: Instead of passively clinging to BTC whose price moves sideways over the course of a few hours or days, you have managed to sell some Bitcoin at an average profit of 0.5% by relying on arbitrage. First, you sold the BTC at 0.5% above the current market price and then instantly bought it back at that same market price to achieve that overall profit. In this way, you are able to put your assets to work and earn money via a relatively low-risk strategy.
Case B: Buy (or sell) a large amount of an asset over time (without moving the price)
Example: Say you have $100,000 and want to buy RUJI over time at a small discount to the current market price without causing people to fomo into RUJI until you are done buying. Then you can place an oracle order at a 1% discount to buy RUJI with 100,000 USDC. The order would fill slowly over time anytime someone does a large enough RUJI market sell that the price falls by 1% within a block. This effectively allows the RUJI buyer to buy RUJI at all of the local wicks (troughs) on a trading chart.
Explanation: Using oracle orders, buyers are able to buy RUJI at the local lows while sellers are able to sell RUJI at the local highs caused by whales who execute large sell or buy market orders that move the price at least X% in one block (a percentage the oracle order creator selects when placing the order).
Case C: Buy (or sell) a large amount of an asset over time (without moving the price) at a tight margin that depends on the gap that can be safely arbitraged. This has the highest possible guarantee of order execution.
Example: Suppose you want to use an oracle order to sell a large amount of BTC at 0.30% above the oracle price. Let’s say the current BTC oracle price is Y. Arbitrageurs can then fill your profit and profit from this 0.30% gap by doing the following:
1) Arbitrageurs first sell BTC to USDC on RUJI Trade at Oracle + 0.30% (by filling the existing oracle order you have placed). After paying a 0.15% taker fee, they end up with Y x 1.003 x 0.9985 or ~ 1.0014955Y per BTC sold.
2) Arbitrageurs then buy back BTC with USDC via an instant swap on THORChain’s base layer pool (which is the source of the oracle) at oracle price plus a liquidity fee (of 0.1% minimum for a swap with two legs e.g. USDC <> RUNE <> BTC). The larger the size of the order relative to the size of the base layer pool, the higher the liquidity fee. Therefore, the size of the base layer pool determines what quantity can be arbitraged profitably in each block. Assuming the swap is appropriately sized to pay the minimum liquidity fee of 0.1%, the arbitrageur is left with Y x 1.0014955 x 0.9990 or ~ 1.000494Y per BTC sold. In this case, the arbitrageur ends up with a profit of approximately 0.5% per block.
3) Arbitrageurs then repeat this process each block until the oracle order is fully filled.
Explanation: One of the biggest benefits of oracle orders for takers is arbitrage. As long as you can guarantee the execution of a trade in a block or so, then by using bots and taking advantage of oracle orders there are many opportunities to make profits from arbitrage. In this way, arbitrage seekers provide a steady source of liquidity for oracle order makers to take advantage of to buy or sell assets quickly with minimal price impact. Because arbitrageurs are guaranteed to make profit as long as they execute the traders in the appropriate size within a block, this type of oracle order is essentially guaranteed to be filled by arbitrageurs of sufficient size.
UNDERSTANDING BASE PAIRS
Crypto trading pairs consist of two assets that can be traded with each other on an exchange and are used to quote one cryptocurrency against each other. In cryptocurrency pairs written first token / second token (e.g. RUJI / RUNE), the first token (e.g. RUJI) is called the base asset and the second token (e.g. RUNE) is called the quote asset. For example, RUJI / RUNE tracks (or quotes) the relative price of RUJI (the base asset) in terms of the price of RUNE (the quote asset). Over time, the RUJI / RUNE market tracks the ratio of the prices of RUJI to RUNE over time.
On RUJI Trade most pairs will be denominated in Token / USDC (one of the most reliable and widely used stablecoins) with limited exceptions for special types of pairs like RUJI / RUNE and pairs quoted in BTC for the projects/liquidity providers/traders that prefer BTC exposure over USDC. This means that trading pairs will track token prices in terms of the value of the US Dollar over time (with USDC as the quote asset) or BTC overtime (with BTC as the quote asset).
As a side note, RUJI Trade will be the only exchange where projects can get their token paired with native BTC, without reliance on any centralized issuer and/or third-party bridge, something we are very excited about. For projects and liquidity providers, this means it gives your token a chance to piggyback on the long term appreciation of BTC vs. the dollar, it makes a lot of sense if you believe BTC will continue to outperform the dollar in the long term. In addition, having a BTC pair alongside your USDC pair creates additional arbitrage routes resulting in more trading volumes and ultimately higher return for LPs, making providing liquidity for your token more attractive. Something worth considering for any project listed on RUJI Trade.
WHY IS RUJI TRADE ESSENTIAL?
As we mentioned above, RUJI Trade is an innovative 100% on-chain decentralized exchange with a variety of order types that empowers users to trade however they want whether focusing on speed, execution price, or strategy. By removing a central player in the process and automating Trade via audited open-sourced smart contracts–large market makers are unable to preemptively take advantage of order flows and trade against users. Meanwhile, everyone gets orders proportionally filled at the same rate and fee-level no matter how much or how little money you have.
The importance of RUJI Trade goes beyond making markets fairer, cleaner, and more transparent for our users. Trade is an essential building block that the rest of the Rujira ecosystem is built around. Much of decentralized finance depends on the fair exchange of assets as a base. Unique to Rujira, we are building all of our major products in-house. They are all tailor-made to maximize product integrations and enhance synergy with every application we have to offer. And because these products are decentralized–as mentioned above–they do not suffer from the manipulation that centralized versions of these same products experience.
Let us cover some of the other main strengths of RUJI Trade:
Scalable Performance: The order matching algorithm is theoretically optimal in terms of scalable performance. RUJI Trade handles large transaction volumes efficiently.
Multi-Source Liquidity: Ruji Trade has a unique robust architecture that allows the orderbook DEX to pull liquidity from multiple sources, including Rujira’s AMM (automated market maker) pools on the App Layer and THORChain’s liquidity pools on the Base Layer via a dedicated market making arbitrage strategy that virtualizes the liquidity in the Base Layer pools.
Oracle Orders: Oracle orders (a novel order type allowing users to buy or sell at a fixed discount/premium to the underlying asset’s oracle price) open up the design space for innovative trading and market making strategies.
Low Fees: Compared to other exchanges, RUJI Trade boasts highly competitive fees, making for a cost-effective trading experience. Expect low gas and low maker/taker fees (0.075%/0.15%).
RUJI Trade’s unique features catapult it into a position where it offers several advantages compared to traditional AMM decentralized exchanges:
Better Trade Execution: Orderbooks offer comparatively better pricing and capital efficiency. Traders can execute orders of any size without moving the price as long as there are willing counterparties on the other side of a trade.
Modular Architecture: Traditional AMM DEXes distributes asset prices over a single bonding curve. Large order sizes relative to liquidity pool size create a bigger price impact (% of price change) suffered by traders upon order execution. By separating the orderbook from the AMM and pulling liquidity from a variety of sources into a single combined orderbook–RUJI Trade enhances overall available liquidity, creating a superior trading experience.
Intuitive Interface: RUJI Trade uses a user-friendly design meant to appeal to both web 2 traders who are unfamiliar with decentralized finance and professional web 3 traders who know the ins and outs. RUJI Trade supports market orders, limit orders, and oracle orders to ensure a smooth trading experience, comparable to centralized exchanges.
By standing out from other decentralized options with comparable performance and ease of use to centralized exchanges, RUJI Trade paves the way for a new era of DeFi that is Omnichain. Every chain, every wallet, every asset, are all available to trade in one place–without the inherent manipulation of centralized competitors.
