Navigating the Launch & Growth of Your Protocol Utility Token with Volpex
A Guide to Secondary Market Listing and Token Liquidity Management
With your protocol firmly on the development roadmap, fundraising completed, product testing underway, and a legion of eager fans and early adopters clamoring for the next stage, now is the time to give your in-game token a life of its own and proceed to list it on a secondary market, either decentralized (DEX), centralized (CEX), or a combination of both.
This crucial stage of a Web3 project´s lifecycle is far too often taken for granted or carried out in a disjointed manner. After all, you have a great product, everybody will know about your protocol, and they will want to get involved by investing in you, right? Maybe not. Any oversights or missed opportunities at the launch stage can, at best, be a costly learning experience or, at worst, cause the project to lose momentum and community confidence, leading to a spiral of negative knock-on effects that can be hard to remedy. That’s why obtaining sound and granular advice is so important to help you navigate the many moving parts involved in creating and managing a secondary market for your utility token. An experienced partner such as Volpex can ensure that you have the best possible framework for making the most of the momentum at launch, providing value for your early backers, enabling liquid and healthy markets for your user base and traders, and growing your treasury while driving further adoption and awareness. Here, we outline some of the important factors to consider when getting ready to go to market.
Exchange Listings – The right exchanges at the right time for your community
Choosing the right venue for your initial listing is paramount and depends on your aims & objectives, your budget, meeting listing requirements, your geographical focus, and community demographics. As such, one of the key things to look at is the exchange connectivity of your liquidity service provider, their ability to integrate new venues, and how this matches your roadmap for listings.
As your liquidity services partner, Volpex is able to provide guidance and assistance with selecting the right venues, help with exchange introductions, review your listing proposals to ensure you are getting the best possible deal, and connect to your markets in a timely and efficient manner.
Preparing for Launch – Token launch management
Where, when, and how you launch your in-game token is a highly important decision with a lot of variables depending on your specific circumstances. This process involves streamlining announcements, marketing campaigns, airdrops, product releases, choosing the right launchpads (if any), the venue/s to list, the most suitable trading pairs, fulfilling exchange liquidity requirements, API end-point rate limits, and much more.
From a trading perspective, every strategy deployed should consider the available circulating supply, anticipate demand or selling pressure, and enable price discovery across the applicable markets.
Ahead of the launch, be cautious of promotional campaigns in exchange for your tokens, as these will, in all likelihood, end up the first on the sell side of the order book. You will also likely be contacted by an array of scammers, impersonating exchange or launchpad staff, so be very careful out there and always double-check before sending any payments.
Market Making – Enabling efficient trading conditions
Most reputable CEX venues require each token team to secure market-making support prior to approving the token’s listing. Even if this is not a strict requirement, going it alone can prove very costly and send the wrong signals to the market and community. Likewise, ethical and robust approaches are essential to ensure token liquidity and trading volumes are real and verifiable.
This is fundamental to the long-term health of the token and to fostering the trust and confidence of your community, user base, and investors. You should not be misled by unscrupulous operators offering guarantees of high volumes and token prices. Order-book building should always be done algorithmically to ensure consistently tight spreads and sufficient market depth to minimize price volatility, even during high-volume trading activity or unexpected market dynamics.
Investor Token Liquidation Services – Enhanced market maintenance
Vesting of investor tokens can often provide a catalyst for price volatility & depreciation as various stakeholders offload a part of their positions and de-risk their investments. In times of uncertainty, a flurry of sell orders can quickly escalate to a “dump” in the absence of robust liquidity and safeguards in place. As a way of mitigating the chances of this happening, many token teams choose to channel large transactions through their market maker to ensure price stability, whether accumulating or liquidating a position. Volpex provides a full suite of options for OTC trades and programmatic trade execution. This approach ensures better yields for your early backers & traders with minimal market impact.
Securing Cash-flow – Additional revenue for your treasury
It is imperative to ensure sustainable cash flow to build & grow your treasury. A lack of sufficient financial runway is certain to set back your development goals. In some instances, you may wish to monetize a part of treasury tokens in the most market-efficient manner. Your market maker may also decide to invest directly in your project by having an option to buy your tokens, provided certain milestones are met. This can translate into considerable extra revenue for your treasury.
Volpex assists in making sure you have all key aspects covered for pre-launch, during the launch itself, and the crucial first hours, days, and weeks following the go-live of your token. As an experienced market maker, Volpex will have the technology and connectivity to ensure that even large market orders are filled quickly and efficiently at a fair price.
Volpex assists in making sure you have all key aspects covered for pre-launch, during the launch itself, and the crucial first hours, days, and weeks following the go-live of your token. As an experienced market maker, Volpex will have the technology and connectivity to ensure that even large market orders are filled quickly and efficiently at a fair price.
Contact Volpex for a consultation or discovery call to find out more.
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