Alpha5, a new derivatives exchange launching this summer, and already backed by Polychain Capital, has secured a new round of funding led by industry incumbents FBG Capital, CMT Digital, Altonomy, SNZ Holding, Nima Capital, Migration Capital, and the Bollinger Investment Group as well as a followon investment from Polychain.
“This is a strong vote of confidence in our conviction of the dormant opportunity still present in crypto derivatives, and I’m glad that belief resonates with our partners” said Vishal Shah, Founder of Alpha5.
Brad Koeppen, Head of Trading at CMT Digital added, “CMT Digital is excited to be partnering with Alpha5, a next generation crypto exchange, to participate in a new wave of product and exchange innovations.”
Alpha5 is preparing to launch spread trading with implied orderbooks as its v1 product, in the belief that it’ll naturally anchor and offer liquidity in contracts that were otherwise difficult to trade. “2/3 of derivatives liquidity in the most liquid crypto, BTC, still clears in the perpetual swap. Think about that. The market is clearly telling you everything outside the front-end is suspect; this is a huge bottleneck for lending desks, bond products, and development of fixed income in general. This ecosystem can’t proliferate on a single crutch. Implieds are key, because in terms of liquidity, it really means 1+1 =3, or some number greater than 2 in all instances. It’s intrinsic, synergistic, and beautiful. It’s also not the easiest lift, but we’ve got it, and are looking forward to being a firstmover.”
Plans for other novel products, including exotic options are also progressing well in the pipeline. Investors are equally confident. “How to design and offer option related products is a key competitive advantage for a derivative exchange to succeed. Alpha5 has a strong and passionate team to re-innovate in this area that we are willing to work with going forward,” said Jingcheng Li, Head of Trading at FBG Capital.
At the core of the ecosystem, and the primary vehicle driving value is the A5T Token, a new breed of exchange token that is laying the groundwork to bringing distributed governance and increased value to token holders of CeFi infrastructure. “We have seen the recent rise of value-add governance tokens and their effect on incentivising adoption. A5T token's unique emission schedule will be great to attract initial liquidity and kick off the project,” added Ricky Li, Co-Founder of crypto trading powerhouse Altonomy.
The exchange is expected to be live this summer. For more info, visit www.alpha5.io