Altcoin Report - January 2021

Note: this report is accurate as of its publication but some details will change over time. Please check the posted date above.

Crypto exchanges have two big problems.

1. Users need to trust an exchange with their personal information, financial data, and funds. And, they need to remember passwords, pass KYC, and sometimes spend a lot of time signing up for multiple exchanges to access the altcoins they want to buy and sell. As a result, the experience is complicated, expensive, and not secure.

2. Cryptocurrency teams have to pay a lot of money to get listed on the best exchanges.

Decentralized exchanges solve these problems.

Because DEXs use open, permissionless protocols, DeFi projects and DAOs can leverage them for “liquidity,” a fancy term for “a supply of tokens that’s big enough to support whatever you’re trying to do.”

Token holders can deposit their tokens into liquidity pools in exchange for rewards. Users can tap into DEXs to swap tokens and build collateral for lending. New projects can quickly find buyers instead of paying sometimes exorbitant fees to list on top crypto exchanges.

To date, there are dozens of DEXs, including my July recommendation.

Today’s recommendation may not offer the potential 1,000x gains of its smaller competitors, but it’s the big dog and first-mover in the space, with strong network effects, VC-backing, and a big user base.

Some say it will put Coinbase out of business, but let’s not get ahead of ourselves. It’ll need better UI, UX, and cost structure before it can compete with Coinbase—not because the tech is worse (it’s better), but because Coinbase makes it so easy for people to buy, sell, send, and receive crypto that they’ll pay a premium for the convenience and won’t care that they’re getting a smaller selection of altcoins.

If anything, this DEX will crush small, shitty exchanges that use fraudulent volume to scam people out of their money. The best projects have started to launch on this platform to avoid steep listing fees to shady bottom-feeders who will probably wash-trade their tokens into oblivion. Why bother when you can get your tokens in the hands of buyers directly?

Thought it already handles more daily volume than all but a handful of traditional crypto exchanges, it has plenty of room to grow, with a token that will capture value from that growth. During this altcoin bull run, it may even grow into the best-known, most-used exchange (period) for Ethereum tokens.

More importantly, if you have some time to learn how to use it, you can simplify the process of buying/hodling altcoins and also access to new projects before they hit the top-tier exchanges like Binance and Coinbase.

For that reason, I included a video tutorial about how to use it, below.

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