Update for the Decred Community on improving DCR Liquidity

Ravi Doshi

By Ravi Doshi


From the i2 Trading Desk:

Greetings!  We appreciate all the support we’ve received over the last few weeks regarding the Decred liquidity project, and are excited to begin the  pilot! If you aren't aware of our proposal to improve Decred liquidity,  this blog post will serve as a recap, and will describe next steps in  the process.

What happened?

I2 Trading submitted a proposal on Decred's governance platform, Politeia, to improve liquidity on DCR with the support of the community. Our proposal was accepted and we will begin a 6 month pilot within three weeks.

What is liquidity and why is it important?

All asset classes benefit from deep liquidity. The Decred community's strong confidence in the project means that roughly 50 percent of outstanding tokens are staked at any given time, and thus unavailable for trading; the result is poor liquidity. Without deep markets, investors large and small are reluctant to invest into DCR, and suffer substantial slippage costs when they do. We are confident that by providing a tighter and deeper market, the DCR ecosystem can grow faster, and buyers and sellers will be able to transact with much greater ease.

Why are we the best people to execute this pilot?

Founded in 2016, Iterative Capital is an alternative investment manager with a focus on large-scale Decred and Bitcoin mining. In 2018 it launched i2 Trading, a wholesale cryptocurrency dealer with offices in New Jersey, London, and Hong Kong, which has grown to over $500M in monthly notional trading volume. The firm is noted in the DCR community for the Iterative Capital investment thesis, which provided new justification for Decred's dual-consensus design. In addition to providing liquidity in the OTC market, Iterative Capital operates the 4th-largest DCR Voting Service Provider and mining pool operator Megapool. In summary, the Iterative companies are the largest stakeholders in the DCR network and its infrastructure.

What is happening now?

We are testing our connectivity to exchanges and verifying that all messages we send are received and vice versa. We are also stress-testing our algorithms to ensure they are robust enough for a mission-critical production setting. So far things are running smoothly. Our next step is to start testing with larger sizes on the order books. Assuming all goes well, we will launch on October 1.

If you have any questions, please reach out to us at [email protected] We are looking forward to continued progress on the Decred network!