Exclusive: Born from Crash, EMDX Is Bringing TradFi to On-Chain Derivative Market

Born from Market Crash

Berni started to dip his toes in Bitcoin as early as 2012, and founded his first blockchain company three years later. As an Argentinian, when doing business with companies around the globe, he found that emerging markets had a lot of difficulties.

"Cumbersome access for private investors, lack of continuous price outside of standard market hours and inability to provide hedging tools." He said, "so I realized that Web3 could be very useful and helpful on that side of things."

This is why Berni co-founded EMDX in 2021, which "focuses on bridging the rails between traditional assets and the DeFi world." After testnet, in June 2022, which was shortly after the Terra crash, EMDX went live on the Avalanche mainnet despite the challenging market conditions. So far, EMDX has reached almost $550 million in accumulated volume, with revenues increasing by ten times. Considering that the crypto space suffered a lot in the past year, this is an inspiring achievement.

"We have had a really good performance so far, with proven execution, zero downtimes and no security incidents. We also have a really exciting and vibrant community. We have about 50K followers on Discord, 600 weekly active users. Even when it was a really tough time." Berni said with pride.

A Different Path than GMX

The derivative market on Avalanche is largely dominated by GMX, so EMDX chose a different niche market. Berni said,

"We want to offer a more institutional service. Of course, we are going to offer crypto assets as well, but we are going to focus on traditional assets and onboarding traditional investors to trade in a very safe way. Because when you start working with traditional and institutional investors, family offices, hedge funds, and so on, the most important thing is that you have to be compliant with a truly trusted infrastructure. So we think that the next wave of crypto will be institutional adoption, within the DeFi environment. So that will be our advantage in relation to GMX and other possible competitors like dYdX and Perpetual Protocol."

EMDX started the partnership with Matba Rofex from its very early days, which is the largest commodities derivatives exchange in Latin America. The collaboration enabled EMDX to launch its most important product, USDC/Argentinian Peso, which is the first ever perpetual FX on a Latam currency. "Thanks to this Web3 version of FX product, people are able to trade in a Web3 environment and in a free way in Argentina, a product which is really needed to hedge their currency exposure." Berni said.

Upcoming Milestones

Due to the Terra crash, EMDX had to postpone TGE originally scheduled for last summer, and to run the protocol without a token for nine months. It was a joint decision by many parties. "We had to recalibrate our TGE time because it made no sense to launch our TGE under those tough conditions. Token prices would have been unrealistic. The community and investors recommended so, and it was general consensus and everyone wanted to postpone."

Luckily, it's finally coming. EMDX TGE will start on April 20th, and you can read the details here. The team will develop a mechanism to incentivize stakeholders, and offer the token as trading rewards. However, EMDX will not adopt liquidity mining. The utilities of the token will be announced in the near future.

Meanwhile, EMDX is raising funds in the second investment round. "We can allocate much more funds to marketing actions and community programs. That is something that we have never done. The users that we have now, or the trading volume, all these metrics are fully organic. We have never paid $1 on marketing."

Expansion Both On-chain and Off-chain

The partnership with Matba Rofex is crucial for EMDX. Like Berni said, "it opens up a path to replicate this model of integrating with big traditional markets or exchanges in our and other regions. We are planning to expand this model with different markets from Latam, then Southern Asia and Europe."

"Our approach is to offer a suite of derivative products, specifically tailored for emerging markets, while also onboarding TradFi operators to expand access to traditional liquidity." He added.

Besides Matba Rofex, EMDX has some other important partners across TradFi, the commodities industry, brokerage, and Web3, including Grupo América, Chainlink, MRM Analytics and Ava Labs, and it's onboarding more.

Next, EMDX plans to deploy a new exchange on the Fuji subnet before Q3 to offer traditional option products in collaboration with some big players in TradFi. It will be CLOB (central limit order book) based, instead of the vAMM mechanism EMDX is currently using. In addition, more FX products like Turkish Lira and Brazilian Real are on the horizon as well.

"Our long-term goal is to become the investment grade DeFi solution to trade emerging markets assets worldwide." To achieve that, EMDX plans to go not only multi-region, but also multi-chain. According to Berni, the potential stages could be BNB Chain, Polygon, and Arbitrum.