In the world of cryptocurrency, decentralized exchanges (DEX) are gradually becoming the preferred platform for investors and traders. Among many DEXs, Aevo stands out with its unique innovation and efficient trading mechanism. This article will take an in-depth look at Aevo’s core features, operating mechanisms, token economics, and its future prospects.
What is Aevo?
Aevo is a decentralized exchange focusing on derivatives trading, covering a variety of financial products such as options and perpetual contracts. Since its launch in April 2023, Aevo has quickly attracted a large number of users and has exceeded $10 billion in transaction volume, relying on its customized Layer 2 solution that combines the security of Ethereum with the efficiency of off-chain order matching.
One of Aevo’s most innovative products is “Pre-Launch Token Futures,” allowing traders to speculate on a token before its official launch. This feature not only provides traders with pre-market valuation opportunities before token issuance, but also provides investors with a new investment perspective.
How Aevo works
Aevo's design concept is to combine decentralized finance (DeFi) technology with an advanced trading framework to create a safe and efficient derivatives trading platform. The core of its technical architecture includes the following aspects:
1. Off-chain order book and risk engine: Aevo uses off-chain order books for fast order matching. This design effectively prevents blockchain congestion problems. The risk engine evaluates orders based on portfolio margin to ensure traders maintain sufficient collateral, thereby enhancing the security of the platform.
2. On-chain settlement: After the order is matched outside the chain, Aevo performs on-chain settlement through smart contracts. This approach combines the speed of off-chain processing with the transparency and security of blockchain settlement, providing users with a smoother trading experience.
3. Second-layer architecture: Aevo uses a custom second-layer convolution based on OP stacking, convolved to Ethereum. This solution not only enables high throughput and low-latency transactions, but also takes full advantage of Ethereum’s security.
4. Liquidation mechanism: Aevo’s liquidation procedure protects the health of the system and traders’ positions. If a trader's portfolio cannot meet margin requirements, the liquidation engine will gradually reduce positions to restore the balance, and the insurance fund will also be used if necessary. This mechanism effectively reduces transaction risks.
Pre-launch futures operations
Aevo’s “pre-release token futures” are another highlight, allowing users to predict the value of tokens before they are officially listed. The product particularly caters to speculators interested in new projects, providing early access.
1. Initial margin and leverage: Traders must provide 50% of the initial margin, and the leverage ratio can be up to 2 times. This feature helps manage the speculative risks associated with pre-launch tokens.
2. Maintenance margin: The maintenance margin is set at 48% to ensure that traders can still maintain their positions when the market fluctuates, reducing the risk of sudden liquidation.
3. Contract features: These futures do not rely on index prices or fund payments, emphasizing their speculative nature and suitable for investors who are confident in the future value of the token.
4. Fees and Settlement: The contract charges a 25 basis point offtake fee, a 10 basis point market maker rebate and a 5% clearing fee to encourage liquidity. Once the token is listed on external exchanges such as Binance, it will be settled in USDC, aligning speculative trading with market value.
Aevo Token Economics
Aevo’s token economy is centered around the $AEVO token, a renamed version of the previous $RBN token that adheres to the RGP-33 governance proposal. Its issuance strategy focuses on increasing platform growth, liquidity and community participation.
Reward mechanism: 16% of $AEVO is used for rewards, aiming to increase user participation through airdrops and marketing activities, and is managed by the Growth and Marketing Committee.
Liquidity guarantee: 9% is used to ensure stable liquidity on decentralized and centralized exchanges.
Community Development: 5% goes toward community events and incentives to encourage active participation.
Reserved part: 16% is reserved for future DAO needs, and 2% is allocated to Aevo project contributors each year.
With the launch of $AEVO, the platform will also conduct a series of reward activities to enhance community activity and participation.
Aevo’s founding team
Aevo was founded by Julian Koh and Ken Chan, whose vision is backed by top cryptocurrency investors such as Paradigm, Dragonfly Capital, and Coinbase Ventures. The development team consists of experts from leading companies such as Coinbase, Kraken and Goldman Sachs, as well as alumni from prestigious universities such as Stanford University, MIT and Cornell University. This diverse professional background ensures that Aevo remains at the forefront of DeFi innovation.
in conclusion
Aevo, a leading decentralized exchange, offers users a unique combination of speed, security and early market access with its advanced Layer 2 technology and pre-launch token futures. As the DeFi space continues to grow, Aevo will continue to attract more traders looking to take advantage of the future of decentralized finance and become a leader in the industry.