After a recent successful raise of US$12M led by some of the most prominent names in the crypto VC space, XY Finance is ready to start setting benchmarks in the DeFi and Metaverse space with their cross-chain mechanism. We speak to XY Finance founder Wilson Huang about his ambitious startup.
Q. Please introduce yourself and what you do at XY Finance, thanks.
I am Wilson, the founder of XY Finance. I’ve been involved in Bitcoin since early 2014, and with seven years of solid experience in the crypto industry, I became the advisor of various protocols.
Q. Congrats on your recent US$12 million raise. How did you manage that?
Thanks. Regarding the latest funding round, we have raised $12 million from Circle (Circle Internet Financial), Infinity Ventures Crypto, Mechanism Capital, Morningstar Ventures, YGG (Yield Guild Games), and Animoca Brands. Besides, we are honored to see investors across core pillars in the industry: exchanges, venture funds, research firms, GameFi DAOs, and game developers, such as MEXC Global, TRON Foundation, gCC (gumi Cryptos Capital), Lemniscap, Evernew Capital, PANONY, Axia8, Looksrare.vc and more.
At first, we identified who would be our strongest partners in the long-term scope and presented the idea of XY Finance to numerous investors during pitches. We select investors from various backgrounds and entities as we want our project to be as decentralized as possible, ensuring that our community calls the shots when it comes to decision making. Our commitment to building the best one-stop cross-chain aggregator for DeFi & Metaverse remains unchanged. We are thrilled to have a strong community, diversified blockchain experts, and resourceful investors to support us.
Q. I see that you also had a number of individual investors. Was there stronger interest overall from institutional investors or retail/individual investors and why?
Institutional investors or retail/individual investors are all quite confident with us. The fundraising attests to growing institutional confidence in the network and its immense value to the crypto trading market. We aim to leverage the proceeds to enable a long-term vision that will accelerate and uplift the cross-chain industry as a whole.
Q. What is the central concept behind XY Finance?
Our central concept would be creating the best one-stop cross-chain aggregator for DeFi and Metaverse. We have built an efficient and user-friendly cross-chain swap for DeFi & Metaverse and single-token liquidity provision service through X Swap and Y Pool. Of them, X Swap caters to users’ cross-chain needs between multiple chains, and the newly launched Y Pool can reimburse swapping fees and token rewards for liquidity providers.
Q. So your main value proposition is your cross-chain feature, how do your cross-chain capabilities compare with your competition?
The most significant advantage of XY Finance is that we have our unique cross-chain bridge – Y Pool. By providing liquidity on our own, we can improve the slow and costly cross-chain transactions caused by unstable liquidity and unreasonable fees. So, it allows users to complete transactions smoothly and seamlessly through our one-stop service.
With the help of Y Pool, XY Finance features the following five outstanding advantages:
- Instant cross-chain transfers (only two transaction IDs needed)
- Incentivized rebalance system (prevents liquidity pool from drying up)
- Earn a share of all transaction fees based on users’ provided USDT liquidity
- No impermanent loss thanks to our single-asset liquidity pools
- Highest composability thanks to many tokens being swappable on XY Finance
Moreover, the XY ecosystem not only focuses on DeFi but also includes GameFi and NFT. Our NFT & GameFi project GalaXY Kats allows holders to enter our future Play-To-Earn blockchain game. Depending on the fraction of minted NFTs, it will provide special utilities such as APY boosts, swap fee discounts, token airdrops, and more via XY Finance services.
XY Finance, together with our unique GalaXY Kat utilities and play-to-earn feature, who said you couldn’t have the best of both worlds? In the near future, we will provide users with a one-stop-shop for services related to the cross-chain exchange or unchain assets such as tokens, NFTs, and GameFi equipment, and more to be revealed.
Q. Tell us more about your tokenomics.
Regarding XY Finance’s tokenomics in the Y Pool, it would be easier to understand it with the image below.
In addition to the XY liquidity bonus, we allocate 80% of the swapping fees from X Swap to liquidity providers and another 20% to the DAO vault. Besides, of the fees allocated to the DAO vault and royalty income from the GalaXY Kats (our NFT + GameFi project), 60% of them are used to repurchase XY Tokens from the secondary market, and 50% of the repurchased XY Tokens will be burned. This helps us to form a virtuous cycle.
After locking XY in the staking pool, XYers can gain governance power to propose, vote, or change system parameters in real-time, as well as start new Y Pools, etc. In addition, a portion of the swap fee will be allocated to XY Finance and the XY DAO as a security fund.
Q. What trends do you see developing in this industry?
The background of how I came up with XY Finance’s idea is that the past year has seen significant adoption in decentralized smart contract-powered blockchains, such as Ethereum, Polygon, BSC, Fantom, Cronos, Ronin, Solana, and Avalanche. As such, demand for swapping and transferring digital assets from chain to chain has skyrocketed too. This has created the need for a cross-chain swap application that provides a fast, secure, and decentralized way to perform cross-chain transactions and staking.
Also, the daily cross-chain volume has surpassed $100M due to multichain ecosystem growth. As DApps and infrastructure continue to mature, and DeFi yield becomes everywhere on multiple chains, we know that cross-chain swap needs will continue to grow. This is why we’re creating our next-generation protocol, XY Finance, to help users seamlessly and optimally transfer and swap assets from chain to chain without any disruption.
About XY Finance
XY Finance is a one-stop cross-chain aggregator for DeFi and Metaverse. Our mission is to facilitate the seamless and secure transfer of on-chain assets, including tokens, NFTs, and more, across all blockchains. The protocol has built a one-click swap aggregator with the highest interoperability that allows crypto users to trade all on-chain assets.
XY Finance consists of the following major components working in conjunction:
- X Swap & Y Pool (DeFi): XY Finance provides a one-stop swap aggregator to provide the fastest, simplest, and most economical cross-chain swap service with a seamless experience and highest interoperability. Meanwhile, liquidity providers can earn yields in Y Pool without impermanent loss.
- GalaXY Kats (GameFi): GalaXY Kats is a collection of 10,000 unique meerkat NFTs and a play-to-earn blockchain game where players can explore the lore of GalaXY universe and help GalaXY Kats revive humanity by challenging bosses and completing quests. Moreover, GalaXY Kats features DeFi utilities on X Swap & Y Pool.
- NFT Satellite (NFT): To satisfy the booming NFT trading demand and follow the fast-developing multichain NFT ecosystem, XY Finance introduces a one-click NFT liquidity aggregator to allow users to buy, sell, and NFTs on different chains in one transaction.