On Jan. 19, 2022, Nasdex announced its MVP launch with full live functionality for actual usage and testing by the community. Nasdex is a decentralized exchange (DEX) for trading tokenized equities on the blockchain and is designed to serve as a bridge between the crypto and equity worlds. The team behind Nasdex believes the on-chain adoption of the equity asset class will deliver increased accessibility with improved capabilities for both crypto and equity investors.
MVP will allow users full access to the Nasdex platform where they can begin minting, swapping and farming synthetic assets through the Web3 portal. The initial rollout will selectively focus on a few stocks, with the inclusion of additional stocks in the future. Over time, Nasdex will be tapping into the total addressable market of the entire equity asset class, which is about $100 trillion in market capitalization — a market more than 60 times the size of the current total crypto market cap. The successful tokenization and on-chain trading of the equity asset class open the gate for further tokenization of additional off-chain assets such as commodities, bonds, real estate and more.
MVP marks another major milestone in Nasdex’s short history. In 2021, Nasdex successfully completed fundraising for their strategic round, which raised $1.2 million and was oversubscribed multiple times. Subsequently, Nasdex underwent an initial DEX offering that was fully sold out within hours of launch. Its native token, NSDX, is now traded on multiple DEXs and centralized exchanges.
Nasdex is supported by Chainlink and Band Protocol, the two leading oracles globally, to ensure that price feeds are both secure and efficient. Oracles are responsible for the important task of bridging real-world stock prices to the blockchain in the form of tokenized stocks.
Synchronization between on-chain and real-world prices is extremely crucial in the creation of tokenized assets. The security, speed and efficiency of the data source is of paramount importance to the operations of a DEX that processes both on-chain and off-chain price feeds. The asset tokenization and swap mechanism requires a powerful oracle protocol in order to enable the integration of off-chain data, such as stock market price feeds, on the blockchain.
Target market TAM
In the initial stages, Nasdex will target a large, under-served market niche: tokenized Asian equities trading for Asian investors. The total market cap of Asian equities is currently about $30 trillion and is entirely absent in the tokenized space. Given that, Nasdex plans to bring household Asian names onto the blockchain and become the premier exchange for the trading of tokenized equities. The initial draw of tokenized Asian equities satisfies a missing tool for investors and is designed to trigger a positive feedback loop with increasing liquidity and user engagement on the Nasdex platform. As an exchange, Nasdex’s success and monetization are based on volume traded, which will be heavily dependent on robust user engagement.
To encourage user engagement, in the later stages, the community and Nasdex tokenholders will have control over the DEX. The community will be the key decision-makers who decide whether or not to add additional markets, stocks and features. The total addressable market (TAM) could further expand to include equity markets globally, which have a total market cap of $100 trillion. Essentially, every off-chain asset could potentially be tokenized and traded through Nasdex, subject to the approval of the community.
Innovation is key
Ultimately, as an innovator, Nasdex seeks to address some of the pain points of the traditional equity investing experience as well as add new features native to decentralized finance and crypto. In addition to the 24/7 trading and fractionalized token trading common to crypto, Nasdex will enable seamless rebalancing between users’ exposure to tokenized equities and crypto — without the need to inefficiently convert users’ crypto portfolios into fiat and then into equity. The ability to conduct portfolio rebalances efficiently and quickly will be crucial for any trading platform, given the increased volatility of the investment landscape.
In addition to improved user experience, Nasdex also promises to deliver increased returns for users as well. Users could elect to stake their tokenized equities on the Nasdex platform to participate in yield farming and liquidity-providing rewards, resulting in additional potentially double-digit returns for Nasdex users. In a world where bond yields are stuck near zero and the average equity dividends are minuscule, an additional double-digit return should be an extremely attractive feature on Nasdex.
Nasdex is the premiere decentralized exchange enabling the trading of Asian stocks on-chain. It is designed to serve as a bridge between the crypto and equity worlds. Its core benefits and differentiation include stock yield enhancement through liquidity mining and a special focus on Asian stocks. Its product offering includes exchange-traded funds, indices, and additional asset classes and derivatives as well. It serves as a user-friendly platform where investors can buy and sell tokenized equities as easily as crypto with 24/7 trading, fractionalized-share buying and yield farming.