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DeFi
Arbitrum DEX Vertex Protocol Secures Wintermute Investment
Trading volumes on decentralized exchanges hit $131 billion in the quarter through March 2023.
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Arbitrum-based decentralized crypto exchange (DEX) Vertex Protocol announced it had nabbed a strategic investment from Wintermute Ventures – the venture capital (VC) arm of the namesake digital asset liquidity provider. Since it launched its platform in April 2023, Vertex experienced strong demand and is now among the top 20 global DEXs.
Vertex Saw Over $1 Billion in Trading Volume Since April Launch
Vertex Protocol, a digital asset spot and derivatives trading decentralized exchange, said on Wednesday it had secured a strategic investment from Wintermute Ventures. The move is expected to reinforce the relationship between the two firms and provide Vertex with the necessary liquidity to continue developing its platform, the DEX noted in the press release.
“Wintermute is a leader in our industry, and we are excited to be working with them. Their expertise and reputation are a great compliment to the other partners we have lined up and show that there is still great demand for DEXs.”
– said Darius Tabatabai, co-founder of Vertex Protocol.
The fundraising comes less than two months since Vertex Protocol launched on the rapidly-growing Arbitrum – a layer 2 scaling solution for Ethereum. Since then, Vertex has seen more than $1 billion in total trading volume, propelling it into the top 20 DEXs in the world.
“Vertex Protocol meets the market’s growing demand for noncustodial trading solutions while also possessing the efficiency of centralized exchanges.”
– Tim Wu, head of DeFi at Wintermute.
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Trading Volume on DEXs Surged in Q1 2023
The launch of the Vertex Protocol and the subsequent Wintermute investment emphasizes the growing demand for decentralized digital asset exchanges. In March 2023, trading volumes on DEXs exceeded $131 billion, marking the third straight monthly increase, according to DefilLama.
In addition, a recent survey conducted by Uniswap revealed that almost 30% of investors who did not trade on decentralized platforms are more likely to start using them this year following a series of collapses in the industry in 2022. Also, “as Ethereum continues to scale and L2s see greater adoption,” DEXs could become increasingly economically accessible for price-sensitive traders, the research report found.
Although trading volumes on decentralized exchanges slumped after March, it should not be surprising if such platforms reignite investor interest, particularly after the regulatory crackdown on the world’s largest centralized crypto exchanges (CEXs) earlier this month.
Would decentralized exchanges become the mainstream option if regulators continue cracking down on CEXs? Let us know in the comments below.
Tim Fries
Tim Fries is the cofounder of The Tokenist. He has a B. Sc. in Mechanical Engineering from the University of Michigan, and an MBA from the University of Chicago Booth School of Business. Tim served as a Senior Associate on the investment team at RW Baird's US Private Equity division, and is also the co-founder of Protective Technologies Capital, an investment firm specializing in sensing, protection and control solutions.
