NFT
A new NFT decentralized crypto exchange (DEX) co-founded by an industry angel investor whose resume includes stints at Coinbase and CoinMarketCap is hitting Ethereum’s mainnet today.
Spencer Yang has become the public face behind Collection.XYZ. Yang, who also co-founded Singapore-based NFT infrastructure startup Gomu, told Blockworks in an exclusive interview that the Collection.XYZ’s operations and trading setup has already been audited externally.
Institutional and retail interest in decentralized platforms to trade cryptoassets has been on the uptick so far in 2023, bolstered in the US by a series of CFTC and SEC crackdowns that have amped up the pressure on centralized counterparts, including Binance, Kraken and Coinbase.
Crypto natives have been stepping in with what they view as viable alternatives to industry drawbacks, including DEX setups.
“A key drawback of current orderbook-based platforms is the inefficiency of price discovery and trading,” a Collection.XYZ statement said. “The launch of Collection.xyz solves these inefficiencies within the decentralized NFT finance space by enabling automated, highly customized trading options.”
Automated market makers (AMMs) are a key innovation in the development of decentralized exchanges, and they enable the buying and selling of assets without intermediaries.
There are four total co-founders, including Yang, and the team is keeping the remaining trio anonymous, at least for now.
Between them, and according to Collection.XYZ, the resumes of the four co-founders include Chainlink, multi-strategy hedge fund behemoth Millennium Management and San Francisco-based software as a service company Zendesk. Yang and his team have been touting their resumes in meetings with potential institutional partners for the DEX, two sources with knowledge of the matter said.
There’s no shortage of crypto-native competition for Collection.XYZ, even with digital asset markets still largely reeling from a series of regulatory events and a tough macro outlook for the US and other major world economies.
Asked what Collection.XYZ’s core differentiators are, Yang said its tech stack and team, as well as its progressing partnerships, would offer a viable and cost-effective alternative to solutions that have been on the market for years — including DEX counterparts.
“Why is it unique?” Yang said. “We built it. We bring something unique to the table, differentiate ourselves from folks like SudoSwap, allow creators to earn royalties, specify what NFTs they actually want to collect…all [adding up to] a very sound solution that is…what the market needs right now.”
Here’s how Collection.XYZ, which relies on automated market maker technology to create digital collectible liquidity, works.
- Traders and users hunting for Ethereum ecosystem digital collectibles are given the ‘technological keys’ to create their own liquidity pools with both ether (ETH) and NFTs they own.
- The AMM setup is designed to power the DEX, allowing users to freely trade between the digital asset pools without relying on a centralized intermediary — an alternative to centralized crypto trading platforms that have come under US regulatory fire in recent months.
- Collection.XYZ users set pool restrictions around which Ethereum-based tokens a given pool will accept, which the statement referred to as “enabling automated, highly customized trading options.”
- The DEX has a vault feature that supports both ERC-20 tokens and NFTs, and that is designed as an incentive for providing liquidity on Collection.XYZ. The vault is intended to win over top NFT creators and convince them to jump from rival and long established platforms. Yang points to the likes of OpenSea and Rarible as continuing to offer stiff competition for Collection.XYZ and other would-be competitors, despite the limitations of both platforms.
Collection.XYZ does not impose protocol-level fees and is designed to “provide liquidity for any collection,” per a statement. The DEX supports tokenized digital collectible ownership of the digital asset pools it facilitates.
Supported ERC-20 based tokens at the DEX’s mainnet launch, per the statement: Ethereum (ETH), Wrapped Ethereum (WETH), Dai (DAI), USD Coin (USDC), Tether (USDT) and ApeCoin (APE).
Collection.XYZ passed an audit undertaken by ADBK Consulting. The statement from the DEX said the crypto auditing specialist “counts Uniswap, GMX, ZKSpace, CitaDAO and Sudoswap” as some of its clients.
