Lucas Huang on Tokenlon, a decentralized exchange built on 0x

0:01i'm ashton addison from eventchain for investmentpitch media and fintech news network and today on blockchain interviews we have lucas huang the head of growth at tokenlawn lucas welcome to the show and thanks for taking the time to be here yeah sure thanks ashton to be glad to be here you're very welcome i'd love to start briefly with getting a little bit of

0:20your background in digital assets and how that led you to token lawn yeah for sure um so the first time i learned about crypto was in 2013 but i didn't pay much attention to it until 2016 when i was learning uh learn well when i learned about ethereum while i was in school studying computer science at the university of chicago and after some research uh the crypto uh

0:47became a rabbit hole for me and i spent most of my free time on it so right after i graduate i joined kyber network which is a team building a decentralized exchange protocol and after spending two years there i came to learn that several friends at i'm token which is a popular wallet they are building a next generation decentral exchange

1:15called tokulum uh which solves some of the challenges we face uh in the deck space so i was really excited and joined them so here uh today i'm here leading the groups and the business photographer that's great and yeah kyber network is a really interesting exchange but now you have token lawn which is a newer decentralized exchange based on 0x and we can we could talk about that

1:39can can you just give a brief overview of what is token law and what's their instant exchange and what makes the platform unique yeah sure um so token is a fast and secure ethereum decentralized exchange powered by xerx protocol and we're using a unique uh rfq which is a request for quotation system uh to bring uh the best user experience to to our users

2:05um and we are constantly ranked as a top five decks by both volume and users and from users perspective there are several things make us pretty unique the first one is the competitive rates uh because thanks to our architecture we are aggregating uh quotes from professional market makers often so uh all of them they can market pretty

2:34efficiently and make very good quotes so we are able to aggregate those codes and offer the best one to our users and the second one is the uh this very smooth user experience we offer it's very easy for them users only need to uh do a few clicks and they can complete the transaction and they always get the number um of token uh in their quotes which

3:02which is we call it what you see is what you get it's not really that always the case for some popular decks like unisof those kind of uh automatic uh multimaker x because they are architectures yeah now go ahead yeah the decentralized exchanges have come a long way since they first you know became a little bit popular in the blockchain industry and

3:26back when i had been using ether delta maybe three years or so now ago it was very clunky it was slow and you know there wasn't any volume the order books were hard to fill but more importantly it was hard for people to even get access to it because the user experience was really bad and i think that's one of the keys to adoption and that's probably partially why

3:49uh tokenline is doing so well and you know being in the top five in terms of dapps can you talk about the user experience part and how does your team approach that in a growth perspective and how do you retain customers and make sure that they're attracted to something that's decentralized sure um we believe offering a good user experience is uh probably one

4:10of the most important thing in terms of bringing crypto product to the mainstream just like what you mentioned so we spend a lot of time doing user research and interviewing our users especially the users from i'm token wallets which is currently most of our users coming from so we provide a very good mobile uh trading experience we started our conversion funnel uh

4:38very carefully and very regularly and it will try to optimize every uh every single step there so probably i can make an example here um many of our uh our tokens first time users they are not really familiar with some concepts like uh israeli gas cost or their token authorization but those are things that that is required for

5:04decentral exchange but many of them they only used central exchange before they didn't expect those of things so when we looked at conversion funnel we saw that many of users they dropped out at the step when they have to authorize the token for transaction and also at times when they when they don't have any ether for uh guest cost

5:33so um we provide a solution so right now if are you using token in the um i'm token wallet uh you can trade without awareness you are doing token authorization and you don't even need to have ether as gas and the the way we achieve it is we combining the trading and token authorization transaction into one single one from user's perspective and if the user

6:03does not have ether for guests we actually send a little bit of ether from our wallets to their wallets so we will have enough gas to do the token authorization and complete the trade so there are many of these little stuff we did to improve the conversion that's great and that is a huge hindrance for a lot of traders that don't want to have to pay gas fees for for

6:31example you're trading an erc20 token and you only have that token you you also need ether just to pay to move that token right and that's one of the sort of disadvantages of ethereum right now but combining that actually is is very uh that's it's that's a very good of your company to do that so actually i really like that and i haven't heard of that before so yeah yeah exactly we saw

6:54many users say i would show usdt from central exchange and wanted to participate in uh either to do trade on token or to participate in uh like yield farming but they will need to need easier so by doing it's uh this our way they were able to participate in those without having ether well that's probably one of the keys that's attributed to

7:21the success of token lawn so far i was looking into the numbers and token lawn has generated or is generating 22 million of annualized revenue for a dap that is you know in the top five of all the dapps um so huge congratulations to your team for that do you have any details on you know what is attributed to that success so far and also how do you

7:46continue to grow to become in the top three in the top one dap yep thanks for that um so i would say um the key from my personal perspective the key is that to be um always taking or talking to your users to iterate your products and being creative about the ways you can do to improve the experience for them so for example for the uh

8:13for the improvement i just mentioned uh we call it gasless transaction uh it's not uh it uh we will call it a workaround for our users if they don't have this um don't have either but we saw good results like the conversion rate was up 20 because of that single improvement wow and once you your products um has an excellent conversion rate and

8:39retention rates then i think it would be a good time for you to invest in bringing more users or the traffic to your debt because your debt can retain it yeah and i really like what you said there about the customer experience and jeff bezos from amazon says the same thing and that's attributed to the success of now multi-trillion dollar company that he was always focused on customer

9:02first and customer experience and and even cz from binance says the same we just they just build what their customers want right and if you understand the customer demand properly and you can fulfill that then i guess the growth will just come yeah exactly yeah so also token lawn is planning now on launching their own governance token uh the lawn token can

9:25you talk about what the lawn token means for the decentralized finance community and also just a little bit uh more about you know the use of governance tokens in a decentralized economy for people that aren't fully familiar with it sure so we announced our loan token about three weeks ago and kicked off a law mining program so our loan token is uniquely designed

9:49to incentive order net network participants of token loan so for the loan money program that we are currently running it incentivize traders and the referrers of token loan so if you are trading on token and paying a fee or if you are referring and bringing your friends to token you will receive some loan token in reward and in the next phases we are going to

10:18incentivize like developers and market makers as well so like so like i mentioned we already plan to incentivize uh for participants but it's not really the case in the space that for example um some taxes like unisop they are also running a liquidity mining but they are only incentivizing our liquidity providers at the moment

10:45so we believe building a truly truly community on decks is very important to our long-term success other participants they are equally important to to our success so that's why we distribute our loan token to uh all kinds of participants that's great and you know tokenlon has had a lot of growth really quickly and as i mentioned back in 2017 there

11:15was such thing as decentralized exchanges so they have been around for a few years now but it seems that 2020 has been the year of explosive growth so far i guess in part to do with the new market making protocols that they've came out with and providing more liquidity better user experience and you know more knowledge in the industry what is your perspective on you know how far along is

11:38this decentralized finance industry and maybe you know do you see explosive growth continuing like it has throughout the summer of 2020 throughout 2021 and beyond sure so i think i think everybody can see that already showing the sign of promising adoption this year especially uh this summer and in the deck space i think it's still extremely early uh

12:06given that there are still billions of users they are still sticking with the centralized finance infrastructure so i believe the number of the users in d5 will continue to grow and probably at least tripled next year but it also depends on their market condition because we saw that one of the key driven factor for this past summer uh was that some defy tokens are

12:32gaining a lot of price action in a positive way so it draws a lot of attention from users and we're seeing many new d5 products uh securing funds this year and so many uh i think next year will be a very exciting year uh be able to see many of them come to life and bring in more users to the space

13:00yeah i agree and you're right there has been some price action by some of the major coins and you know having those major defy coins listed on major centralized exchanges as well like binance i think brought a lot of attention to the decentralized space which is great so but at the same time that price action also brings in people that sometimes come in and and then get

13:23out quickly as well and of course nothing goes up in a straight line you need to have retracements as well for sustainable growth um so i think that overall the the long-term perspective in the next coming years is up but that doesn't mean that it's going to go up in a straight line right right yeah so uh one last question or maybe two last questions first of all about

13:47the security of the platform and the user's funds normally in decentralized exchanges users are holding their own funds and can even access it from a hardware wallet or from a non-custodial wallet where token tokenland doesn't hold the funds is that the case with tokenlon right now and if that's not a risk on your half behalf to be holding users funds

14:13are there other security risks in the platform that you need to manage as the platform grows sure that's a pretty good question and you know as a decentralized exchange we don't hold users funds and the key is that users hold always keep the custody of their own fonts and they can trade directly from wallets so for tokolo it's saying that there's no

14:37counterparty risk there but just like many other depths or the default applications there will always be a small contract risk so uh like we all know that uh code probably can be perfect and there could be bugs and we saw uh we saw bugs in some taxes before and there were some incidents so what we do is we always keep so there are two things we do basically

15:07first one is we always make sure our contracts codes they are fully audited by the top security firm before release and second one is we always uh try to build on top of the uh most battle tested protocol existing protocol out there so in our case uh then it's the 0x protocol that have been out for a long time and battle tested and we decided to build on top of

15:35it yeah 0x is a great protocol so i think that's the right decision there and we're running out of time lucas but uh if the viewers are looking to learn more about token lawn or the lawn token or the xerox protocol base layer what's the best way for them to learn more about the platform yeah sure so if you haven't tried out soak along you're welcome to

15:55try it out and visit our site at tokolone.in and if you have any questions for me or you want to reach out for any partnership discussion feel free to send the email to me at lucas lucastoken.in sounds great lucas i will leave those links in the description box below for the viewers thanks so much for your time i really appreciate it all the best with token

16:17lawn moving forward and let's follow up in the near future thanks aston uh thanks for having me really appreciate your time