KTX: New "GMX" with $4 million in funding

Author: Rhythm BlockBeats

On July 12, the decentralized derivatives trading platform KTX.Finance on the BNB Chain ecosystem announced the completion of a $4 million seed round financing, led by Hashed, with participation from a number of VCs including AlphaLab Capital, CRIT Ventures, 100&100 Ventures, Trinito Corporation / Morpheus, GSG Asset, Lapin Digital, KuCoin Ventures, and Sky9 Capital.

From the official launch of the mainnet to the announcement of the $4 million financing, KTX.Finance took only 43 days.

What is KTX.Finance?

KTX.Finance is an on-chain decentralized derivatives trading protocol operated by Alphamesh and incubated by Singapore's Web 3 infrastructure and venture capital firm ByteTrade Lab. KTX.Finance aims to provide traders with a trading experience similar to centralized exchanges (CEX) while benefiting from the permissionless nature of decentralized finance (DeFi).

Currently, the KTX.Finance platform allows traders to use up to 50x leverage, offering only three perpetual contract trading pairs: BTC/USD, ETH/USD, and BNB/USD. The swap function supports five cryptocurrencies: BTC (BTCB), ETH, BNB, USDT, and BUSD.

According to data from the KTX.Finance official website, during the testnet phase, the platform attracted a total of 15,500 trader users for testing. After officially launching the mainnet, KTX.Finance accumulated 1,346 trader users within 45 days, with a total trading volume of $41.74 million and an open contract volume of $290,000.

Emerging things always attract attempts from SmartMoney. Although the platform is still in a very early stage, perhaps the goal of catching up with GMX is not as far-fetched as it seems (the image below is from Dune).

From the perspective of the entire BSC network, although the network currently has a TVL of $4.8 billion, there is a lack of derivatives trading platform projects at the top of the ecosystem. For BSC, the derivatives trading platform track is not crowded, and KTX.Finance has seen this opportunity.

Image source: DeFiLlama

Token Economics

According to official information, we can see the project vision through the token economic system architecture familiar to KTX.Finance—"to become GMX on the BSC ecosystem."

Like GMX, KTX.Finance adopts a dual-token model in its token architecture, consisting of the LP token KLP and the governance token KTC.

KLP

KLP acts as a "liquidity proof" receipt with unlimited supply in the token architecture. By minting KLP, LPs provide liquidity to a single liquidity pool, which consists of 50% stablecoins (BUSD and USDT) and 50% blue-chip assets (ETH, BTC, and BNB).

KLP is minted with the underlying assets in the pool and redeemed when destroyed. A certain fee will be charged during minting/destroying, with 70% of the platform's fees rewarded to KLP holders (paid in BNB).

KTC

The total supply cap of KTC is set at 100 million tokens. Minting tokens beyond the maximum supply will be subject to a 28-day lock-up period, which will only be considered when launching more products and needing to increase liquidity mining. In addition, whenever KTX.Finance wishes to make any changes, it will call on token holders to use KTC for governance voting to ensure community participation and consensus on these decisions.

As the governance and utility token of the KTX.Finance platform, KTC stakers can receive an additional 30% of the protocol's trading fees, also paid in BNB.

When users stake KTC, they will earn multiplier points at a fixed 50% APR. Points can be staked using the "Compound" button on the "Earn" page to earn fee rewards. Each multiplier point can earn the same amount of BNB rewards as normal KTC tokens. This means long-term holders can receive more BNB rewards over time.

However, when users decide to unstake, all earned multiplier points will also be reset to zero.

The project team currently has the following allocation plan for the 100 million KTC:

• 10 million KTC for providing liquidity for trading pairs on PancakeSwap
• 30 million KTC to support the ecosystem
• 10 million KTC allocated to early investors
• 20 million KTC allocated by the project team
• 30 million KTC for paying esKTC rewards

esKTC

In addition, users staking KTC and KLP will receive esKTC tokens. The number of KTC or KLP tokens required for staking depends on the amount of esKTC the user wishes to obtain and the average staking amount on the platform.

According to an example provided in the official documents, if a user has 100 KTC tokens and earns 10 esKTC tokens within a month, to convert these 10 esKTC tokens back to 10 KTC tokens, they need to stake 100 KTC tokens along with 10 esKTC tokens. (The actual ratio depends on the account's average staking amount and the rewards earned.)

The use cases for esKTC tokens on KTX.Finance include:

• Staking Pool: esKTC can be staked to earn rewards, including KTC tokens, esKTC tokens, and multiplier points. By staking esKTC, users can compound rewards and earn the same rewards as staking KTC tokens.

• Lock-up: KTC stakers can convert KTC to esKTC tokens, which cannot be sold, and once converted, will be automatically locked for one year. The process of converting back from esKTC to KTC will occur linearly over one year, gradually unlocking over time.

Conclusion

According to data from KTX.Finance's official website, there are currently only 1.45 million KTC in circulation, with 36% of KTC staked, and the market cap of KTC tokens is only about $1.197 million.

At the same time, the project team has also showcased the project vision in the product roadmap. KTX.Finance is currently launched on the BNB chain but will focus on implementing cross-chain compatibility in the future to meet the needs of all traders.

Although investors can currently only obtain KTC assets through PancakeSwap, the presence of KuCoin Ventures in the list of investors may suggest that KuCoin will be one of the first CEXs to support KTC trading. Looking further ahead, we believe that "listing on Binance" is the ultimate goal for all excellent projects in the BSC ecosystem. DYOR