Exchanges

Exchanges are naturally a topic of discussion and interest of the community, and prior to this week, we did not have enough information to make an accurate enough of an assessment of the “Top 7” exchange situation — but now we do. In early June, we had a mutual agreement with a consistently top 5/top 6 exchange with large maincoin volume, to list in Late June, Early July. In late June, we were notified that the guaranteed listing date will need to be postponed to August for reasons that are unclear. Come the last week of June, we were also sent a new contract with an adjusted price of close to two times that of the original with no clear reason other than to “fit market rate”.

In early July we obtained advisory from our institutional investors and friends and partners from the blockchain space on this matter, and came to the conclusion that this particular exchange typically does not bring much additional volume to altcoins, as the main userbase, being institutions and professional traders, do not focus on coins below the top 15 ranking in market cap. Hence taking into consideration the combination of the particular unfavorable deal at hand and minimal value add in terms of potential volume, we were advised to move on and save the funds for community and ecosystem growth to build up organic demand.

Indeed, the vast majority of volume for any “altcoin” project is brought from the community, and of course, the exchange can help or increase the probability and magnitude in which each and every community member trades on that exchange. But in most cases, users of an exchange are unlikely upon every new coin listing go and pour funds in and start trading the coin. The only 100% positive correlation is between volume and community size and coverage.

Having said that, we are continuing to have conversations with exchanges and to discover pros and cons of each, and to advance cooperation if we deem suitable — it’s apparent that the exchange space is changing fast and it’s hard to say who are the incumbents, leaders, and rising stars within 4–6 months time. In the most short-run, we’ll see how the trading competition on Bit-Z goes.