Pantera Partner: Interpretation of decentralized derivatives exchange Aevo

Author: Paul Veradittakit, Partner at Pantera Capital; Translation: 0xjs@金财经

Key Points:

Pantera recently invested in Aevo, a company focused on options and perpetual A decentralized derivatives trading platform for trading. Previous investors include Paradigm, Dragonfly Capital and Coinbase Ventures.

Aevo runs on Aevo L2, a custom Ethereum Rollup built using the Optimism stack.

Aevo’s main products offered on the exchange are perpetual futures, options and pre-release tokens.

Introduction

Aevo is a decentralized derivatives trading platform focusing on options and perpetual trading. It runs on Aevo L2, a custom Ethereum rollup built using the Optimism stack. This enables Aevo to support more than 5,000 transactions per second and has processed more than $30 billion in transaction volume to date.

The exchange uses a hybrid model - an off-chain centralized limit order book for matching trades, combined with on-chain settlement using smart contracts on Ethereum L2 for actual trades. This enables Aevo to provide a high-performance, low-latency trading experience similar to that of a centralized exchange, while maintaining the security and transparency of decentralized settlement.

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Aevo currently offers three main products:

1. Perpetual contracts – allowing users to go long or short on crypto assets with up to 20x leverage. Aevo supports multiple cryptocurrency perpetual contracts, including BTC, ETH, SOL, AVAX, and more.

2. Options - Provides an on-chain options order book where users can buy and sell call/put options on cryptoassets with various execution prices and expiration dates.

This includes ETH and BTC options with weekly, bi-weekly and monthly expirations.

3. Pre-Launch Token Futures - Aevo provides a futures market for tokens that have not yet been issued. Once the token launches on CEX, Pre-Launch futures convert to regular perpetual futures.

They have special parameters such as 50% initial margin, no index price and no financing payments. Prices are entirely speculative and based on market demand.

Aevo is now the top choice for the Pre-Launch market, earning the title “The Coingecko/Coinmarketcap of Pre-Launch tokens”. Recent successful pre-launches include Jupiter and Starknet.  

The transition from Ribbon Finance to Aevo

Aevo was created by the same team behind Ribbon Finance, a groundbreaking DeFi options protocol that has been automated The options vault handles over $10 billion in options volume. Ribbon's options vault holds an all-time high TVL of over $350 million and has earned savers over $50 million in option premiums.

In late 2023, the Ribbon team decided to expand from an options vault to a mature decentralized options and perpetual contract exchange. This led to the creation and launch of Aevo.

The Ribbon team brings their extensive experience and track record in DeFi options to Aevo. The exchange quickly gained traction, with over $30 billion in trading volume within just a few months of its launch. Aevo aims to build on the success of Ribbon to create the leading decentralized derivatives exchange.

The team behind the innovation

Ribbon Finance co-founders Julian Koh and Ken Chan bring extensive experience and academic backgrounds from their time at Coinbase. Julian is a Cornell University alumnus who worked on cryptocurrency integration, custody and staking at Coinbase and contributed to Metastable Capital through research and due diligence. Ken’s experience includes key roles at Coinbase focusing on custody, prime brokerage and asset appreciation, and time at Zilliqa as a research engineer where he sharpened his blockchain development skills.

Their combined expertise and history in the cryptocurrency space makes them a formidable team in the DeFi space.

Conclusion

Aevo is a fast-growing decentralized derivatives exchange that has quickly become a major player in the DeFi derivatives space. By combining the performance and user experience of a centralized exchange with the security and transparency of decentralized settlement, Aevo provides a compelling platform for on-chain cryptocurrency derivatives trading.

The exchange’s core products—perpetual contracts, options, and Pre-Launch token futures—have all seen widespread adoption, with total trading volume exceeding 300 in less than a year after launch. One hundred million U.S. dollars.  

Aevo was created by the team behind Ribbon Finance, a groundbreaking DeFi options protocol that has processed over $10 billion in options volume. The team’s deep expertise in DeFi options informed the design and development of Aevo, which builds on Ribbon’s success in creating a more comprehensive derivatives exchange.

Looking ahead, Aevo is poised to continue growing rapidly as more users and assets migrate to decentralized trading platforms. With its innovative products, high-performance infrastructure and experienced team, Aevo aims to become the leading destination for crypto derivatives trading in DeFi.