Initiate discussions around token listing in Tier-1 exchanges.
While the topic of exchange listing has been heavily asked (or/and wanted to be discussed), this has been shun until the launch of authoritative DAO for legitimate reasons. As such, now is the good time to initiate this discussion.
There are obvious pros and cons of getting listed in Tier 1 exchanges, as applicable for many other projects. To save time and space, I will highlight the two most critical issues faced by and relevant to API3 token: it’s accessibility and a lack of liquidity issues.
- Accessibility: API3 is currently listed in Okex, Huobi, Kucoin, and a few DEXs (Decentralised Exchanges). It is fair to say that the go-to exchange for a majority of users is Binance, Coinbase, (FTX, Kraken, Bitstamp, etc), and I’ve rarely come across average users holding KYCed accounts in the above Chinese exchanges nor favor DEXs (Decentralised Exchanges) due to their costs/complexities. Having to sign-up additional accounts (KYC, sending funds, writing private codes, etc, waiting for account approval, etc) create a big barriers of entry and friction for average users, which represent a large user base in the space.
In normal start-ups, it’s similar to having a high drop-out rates in the sign-up phase of a product due to complexities (interested users in API3 become discouraged in sign-up phase due to many unnecessary frictions) or similar to us not being listed in iOS Appstore and Google Store.
- A lack of liquidity: From here (API3 price, chart, market cap and info | CoinGecko), we can see that API3 has a poor liquidity. $20,000 purchase from an exchange will move the market by 2% and if we look at the likes of Band and Link, it has a 6 and 7 figure liquidity. Having a weak liquidity could result in a few large sellers (or buyers) to drastically move the pricing, making it difficult for sophisticated investors to deploy capital into API3 token (both entry/exit risk). Having more exchanges and diversified liquidity resolves this issue and presumably, Tier 1 exchanges require higher liquidity and orderbook depth, so combined with the accessibility issue, I consider exploring Tier-1 exchanges to be adequate (rather than increasing market maker liquidity in Okex/Huobi).
The current bear market timing is also great for us to negotiate on the fees associated with an exchange listing. Despite Coinbase being the most favored exchange, they have higher requirements which API3 does not seem to meet at this stage so i suggest we target for Binance listing by Q4/21 with the leg work being started in Q3/21. (These dates are just example timelines from me to brainstorm which is likely to be different in reality).
Comment and share your thoughts so we can proceed to an official proposal in the near future.