🗣️ Preamble:

GTM Priority 1: Solving the chicken-and-egg problem faced by new crypto exchanges

• Professional market makers (MMs) and institutional funds require a steady flow of retail traders to provide liquidity and profit from spreads or price volatility. MMs have limited capital that must be deployed where the return on investment (ROI) is highest. Until an exchange shows promise (via retail or algo trading flow), MMs are often reluctant to allocate significant resources.
• Conversely, retail and algo traders need a deep, liquid order book with tight spreads and minimal slippage, which only professional market makers can provide effectively.
• This creates a cyclical dependency: each side needs the other to participate, but neither wants to commit first without guarantees of the other's presence.
• To solve this chicken-and-egg problem, we'll execute a tactical sequential points campaign and focus on a segment largely untapped by DEXes: algo traders.
  • We'll first prove retail and algo trader demand with a pre-launch campaign consisting of a waitlist, followed by a sophisticated paper trading competition. We'll leverage these as proof points to attract initial market makers.
  • Unlike AMMs that focus on retail manual traders executing few trades daily, we'll target algo traders. These traders often generate much larger trade volumes than retail traders. Even with low retail participation, bot traders can produce significant volume (exploiting arbitrage and spreads), giving our exchange an active appearance.
  • This activity is crucial for attracting retail traders, who gauge liquidity based on visible volume and activity. This, in turn, helps us attract retail flow, which then draws more MMs.
  • To further entice MMs, we'll offer aggressive maker fee rebates initially and align incentives through strategic investment.

GTM Priority 2: Getting maximum validation with the least amount of time. Be Scrappy!

To achieve maximum validation with minimal engineering effort and build-out time, we've devised a phased approach:

• Phase 0: Waitlist Campaign (Q4 2024)
  • Launch a pre-registration waitlist to gauge interest and collect early user data.
• Phase 1: Paper Trading Competition + Staking (Late Q4 2024 / Early Q1 2025)
  • Deploy a simulated trading environment using real market data.
  • Algo traders: Allow users to test API integrations and trading strategies.
  • Manual traders: Allow users to test trading UI/UX.
• Phase 2: Base/Binance Smart Chain (BSC) DEX MVP (Late Q1 2025)
  • Launch a minimal viable product on Base or BSC to test core DEX functionalities, including margin trading. Build up MM liquidity.
  • Simulated “native” asset support.
  • Bootstrap functionality by integrating with other DeFI protocols on Base / Binance Smart Chain. (eg. Pre-existing money markets)
• Phase 3: Full Appchain Implementation (H2 2025)
  • Truly “native” asset support.
  • Built-in money markets for margin.
  • Even wider asset support.
  • CEX-like performance

This phased approach allows us to validate our concept, build a user base & momentum early on, and start iterating quickly based on user feedback, all while minimizing initial engineering overhead and time-to-market.

More details below on the phased approach: 🚀Sequential Releases / Points Campaign - In Detail

The Importance of the Asian Trading Market

• According to The Block (Link: https://www.theblock.co/data/crypto-markets/spot), Asia-based spot trading volumes dominate North American + Europe- based spot volumes 3:1 - 7:1 (depending on the month)
• In our view, in the North American trading market, the continued growth of the ETFs will also put downward pressure on the desire to trade the spot markets with the underlying assets as retail flows in NA go towards ETFs instead.
• This underscores the importance and size of the Asia-based trading market relative to the western one.
• As we act on the GTM outlined below, we must be intentional about targeting Asian traders:
  • We'll need boots on the ground, and I think that starts with ourselves being boots on the ground there (SG) for large parts of the year moving forward (especially after the initial Waitlist phase)
  • Tony has family ties there, can speak the language (Both Mandarin / Cantonese - although his crypto-specific Chinese needs brushing up!)
  • Being in Asia also allows us to be co-located with the largest MMs in the space, which will be some of the most important relationships we'll have from a BD perspective.
  • We'll need to hire an Asia Growth Lead who has experience growing a CEX / DEX in that region. Initially as a consultant before moving full-time.