On Thursday, August 8th, Switcheo participated in NEO Global Development’s (NGD) recently launched NEO LIVE series. NEO LIVE is an Ask Me Anything (AMA) style community event that takes place on the official NEO Telegram channel. The first NEO LIVE hosted Travala, and the second hosted Guardian Circle.
Switcheo representatives that answered questions in the AMA included:
- Ivan Poon, CEO of Switcheo
- Jack Yeu, COO of Switcheo
- John Peterson (aka Intsol), Switcheo developer
The full transcript can be found below:
Yanyu Shen (director of NEO EcoFund): Hi, everyone. Welcome to the third NEO LIVE on Telegram. This is Yanyu Shen, Director of NEO ECO Fund. We’re very happy to have you guys here. I will be your host tonight. So, Jack, feel free to start your sharing.
Jack: Hey all, for those who are new to Switcheo, Switcheo is the first decentralized cryptocurrency exchange on the NEO blockchain which now allows trading of EOS, Ethereum and NEO tokens.
Our goal is to achieve a DEX network with cross-chain swapping capabilities across multiple blockchains, with a focus on delivering a world-class trading experience in a fully trustless and decentralized environment.
Yanyu: Great. Decentralized finance has been making waves over the last several months following the surge in platforms and products offering DeFi services. Many DeFi applications take this into account by offering hybrid digital asset financial services. What’s Switcheo’s product strategies?
Jack: Switcheo’s core product is our DEX – which is fundamentally a DeFi product – our product strategy is to work on interoperability between multiple blockchains.
Yanyu: What’s your view on later 2019 and Switcheo’s corresponding milestone for this year?
Jack: It seems like the blockchain space is evolving a lot with more products reaching maturity and launching their promised products; we’ve seen a lot of new blockchain launches this year, namely Zilliqa, Cosmos, etc. And, many other projects working on top of these newly launched blockchains – we’ve been working on our own chain (Switcheo Chain) that would allow us to connect to these new blockchains easily.
Songping Que (NGD marketing): It seems that the questions have rolled in. Let’s start the open question session now.
To make it easy for the team to trace the question, please kindly number your questions, starting from 1. eg. A raise question starting with Q1, then B raises questions starting with Q2. Please keep the questions about NEO and Switcheo, we will remain the right to select the questions. Also, the team won’t make comments on the token price.
Q1: Will there be an announcement at the end of this session?
Jack: Announcement from Switcheo? No.
Q2: Will SWTH adopt a staking model?
Jack: We will launch a new token model with Switcheo Chain with a staking/validator system.
Switcheo Chain is our own side-chain. Our objective is to create a truly decentralized exchange through on-chain order matching with a decentralized governance system, which would allow for a listing process governed through validators on our blockchain. We have decided to instead build trustless gateways to execute such swaps, allowing for any projects to create Switcheo Chain assets through these gateways instead, thereby reducing our reliance on centralized counter-parties to ensure the safety of their funds.
You can read more about this in The Switcheo Token article:
Q3: What made your team start to create the wallet for users?
Jack: I assume you’re referring to Switcheo Account – we wanted an easy way for users to manage their wallets across the different blockchains we support on our exchange.
Q4: How does your exchange ensure the safety of users’ assets?
Intsol: User’s assets a kept safe through the exchange being non-custodial. You are always in control of the tokens via your keys. The team has no access to your assets in the exchange contracts. Additionally, we are always researching the newest security developments.
Q5: What are your next products and market expansion plans? What is your market target?
Intsol: Our major upcoming development is the Switcheo Chain, which will facilitate the addition of new blockchains and additional exchange features through the more flexible smart contracts on Switcheo Chain.
Ivan: We’re looking at liquidity pooling and margin trading in the mid term. In the near term we are planning a portfolio comparison feature as well as a potential collaboration with NEO EcoBoost.
Q6: What kind of background checks is Switcheo is doing for new tokens and assets before these are listed on exchange?
Jack: We’ve got a listing team that ensures the legitimacy of the team through stringent KYC processes and due diligence checks on the project.
Q7: What better user experience features do Switcheo offer than centralized exchanges?
Jack: We have an intuitive user interface that users are clear on the movements on their funds through every transaction that is made – such as withdrawals and deposits from the exchange’s smart contract to the user’s wallets.
Q8: When will you move from NEO to your own chain?
Ivan: We aren’t moving from NEO. Switcheo chain is a sidechain to scale trade transactions to thousands of transactions per second (TPS) without spamming the NEO network. We still rely on NEO to secure funds.
Q9: Is there a timeline or a roadmap when you plan to migrate fully from NEO to Switcheo chain?
Jack: As Ivan mentioned, we’re not moving from NEO – we plan to launch Switcheo Chain later this year (Quarter 3 or 4 of 2019).
Q10: Can you describe your economic model? I think DEX is not a technical issue, nor a traffic problem, but an economic model problem. As can be seen from the DEX of Binance, the transaction depth is not enough, even though Binance has a lot of users.
Jack: We’re working on a way where users can contribute to a liquidity pool to automatically fund market making on our exchange and to ensure a liquid order book.
Ivan: We’ve learnt a lot from the wider ecosystem. We plan to use ideas similar to Uniswap’s automated market making which can pool and improve liquidity tremendously.
Q11: What is Switcheo’s policy towards tokens that hold strong privacy toward digital transactions (like Zcash) in the case that an institutional operators asks Switcheo not to support these kind of assets in Switcheo’s services. Will Switcheo try to offer these kind of assets for its users or will Switcheo co-op with institutional enterprises and their regulations?
Jack: Currently, we’re only on three different blockchains. While we would want to work with newer blockchains in the future, we would always comply with regulations and are open to co-operate with institutional enterprises.
Ivan: In order to avoid KYC requirements it will likely only be added when we have succeeded in building a truly decentralized and unstoppable DEX. Otherwise as a company we are bound by regulations, as Jack mentioned.
Q12: Is there a plan of integrating BTC swap in near future?
Ivan: Yes we are looking at something innovative regarding BTC support.
Q13: What are the plans for attracting more users, since NEX makes most of your exchange trade volume and they will be launching soon?
Jack: We plan to have a more community inclusive model through our liquidity pooling system.
Q14: Please elaborate on staking, what is the requirement of being a validator and what would the yield be for an everyday investor?
Jack: We will release more details on the requirements on being a validator closer to the launch of Switcheo Chain.
Q15: How will Switcheo increase volume?
Jack: We plan to introduce liquidity pooling to increase order book depth, which reduces slippage when making a trade thereby increasing organic volume.
Q16: Do you have plan for mobile ends?
Intsol: The Switcheo WebApp is fully responsive for mobile and the exchange can also accessed as a dApp via various Mobile Wallet Apps (e.g. O3 for NEO).
Jack: We currently have a mobile site where users are able to connect through their Switcheo Account or multiple supported wallets.
Q17: Have you considered doing an IEO for some projects, if there is any interest for it?
Intsol: Perhaps. We did our initial ICO (IEO) on our own platform and we’re looking into how we can do it in a transparent and fair way.
Q18: ETH and EOS trading volumes have been lagging far behind the more established decentralized exchanges such as IDEX and Newdex. How will Switcheo boost its exposure in those ecosystems and capture a significant portion of the trading market share?
Ivan: We’ve actually been steadily growing our Ethereum user base and are looking at EOS next. There’s been a few ongoing campaigns targeting these users. We expect to become dominant in these chains as we are in NEO very soon.
Q19: How can users be ensured they are in control of their assets?
Jack: As the nature of the exchange is non-custodial, users are always in control of their assets – we do not have access to your funds in the contract.
Ivan: Our smart contracts are open source on Github for verification!
Q20: Could you explain the state-of-the-art encryption in non-technical aspect? And how can it back the safety?
Ivan: Put simply, we secure funds using NEO smart contracts. No private data is ever sent to Switcheo.
Q21: How about hiring a professional marketing team to gain traction?
Jack: We already have a professional marketing team. Our marketing team has been working hard on pushing out our newest products like our Switcheo Discovery series.
Ivan: We have also engaged a world leading company to spearhead something exciting. However, now is not the time to reveal details.
Q22: How big of a threat is IDEX to you? They will offer more blockchains like NEO in the near future according to their plan.
Ivan: IDEX is actually only focused on Ethereum. With their KYC requirements, they may actually lose users. In either case we are confident of continuing to retain our NEO audience.
Jack: While IDEX is currently leading in the Ethereum space, we’re looking to establish our market dominance on multiple other blockchains, as we have with NEO.
Q23: If I own 1M tokens, does that make me a 51% share owner? Can I perform a hostile takeover?
Ivan: There is no way to steal users funds in any case regardless of token holding, if that’s what you are asking.
Q24: Can you share some thoughts on which blockchains or types of blockchains you guys are looking to add next?
Ivan: We were looking at Ontology due to their similarities to NEO. However there are many other blockchains that could be worth integrating and allowing swaps / trading with NEO.
Note: Some edits have been made for formatting and readability. The full conversation can be found at https://t.me/NEO_EN.