Nekodex: Perp Protocol's Mobile-First Path to Retail

0:00 Welcome back to the permissionless podcast brought to you by the team at Guardian. And of course, as always, we're going deep with teams building on the forefront of DeFi and solving some of these hardest problems that is affecting DeFi at this time. And of course, we are living up to this standard today with really an insightful conversation with Shao from Perp Protocol.

0:26 And Perp Protocol is a team that's been building in the space for quite some time and building for a while with derivatives. And so it was very interesting to see how Shao's approach to derivatives and really the business model of DeFi in general has evolved over the years and what they've come to now, which is where they're trying to absorb retail users and get them into their product suite with a front-end product and have them start using per derivatives and leverage trading as a back-end product.

0:56 And so it was really insightful to see how a team that's been in in DeFi for quite some time is envisioning and working on user acquisition. So of course we'll we'll dive into that much much deeper and really a lot more in the discussion that follows. But first, of course, my name is Owen and over three and a half years ago, I founded Guardian based on the premise that DeFi would one day house trillions of dollars of assets and that we would need a stepwise increase in the level of security that we have available to us to be able to ship confidently in that environment.

1:31 And today, I'm happy to say that at Guardian, we have achieved this necessary standard. We use not one but two dedicated auditing teams on every scope accompanied by a world-renowned lead security researcher and a dedicated fuzzing engineer for the entire engagement. And we're able to gain so much confidence in this methodology that we're able to put up our own funds as a bounty on the contracts on behalf of the protocol team to show our confidence and be able to prove our model and its effectiveness.

2:05 So I mean really at this point it is just up to DeFi to catch up. And so now of course let us finally dive into this conversation with Shao from Perp Protocol. Excellent. Well I mean first of all welcome Shao and and thanks for taking the time to to join us. And I mean really I'd love to just start and and understand like how did you even find your way into into DeFi and derivatives in the first place?

2:36 Well, so we actually started at like 2018 but at the time we're doing another option protocol. we couldn't the pro liquidity problems but we kind of like at that time the market is crashing badly and we tried to find a way to oh stay in the ecos this crypto space we we we started to build a sus actually it's a crypto accounting until like 2019 that we found there at that time I remember is Uniswap is becoming more popular and we found auto am is super cool that maybe it's time that we can solve this good problem and it ends it becomes per and then that's probably the the a very quick journey on how how we enter DeFi space and crypto space.

3:19 Yeah. So I mean you guys were one of the first players in the per space. Is that right? yeah remember there are still a few but yeah we are probably one of the few that still alive. Yeah. Yeah that's definitely true. I mean and in DeFi that's like no small feat to be what is it like six years at this point for five to six years.

3:39 Yeah. I mean that that's really impressive for any DeFi protocol. And I mean what was it like the switch from trying to build like a accounting software for web two for web 3 which I assume is mostly like a web 2 endeavor. There's no like smart contracts necessarily involved in that to making the switch to building like a very heavily focused like smart contract derivatives protocol.

4:02 Did you have to do any like technical overhaul in terms of like I mean obviously solidity was like pretty new. what was that experience like? Actually we actually when we are doing this that option decentralized option protocol in 2018 we already start to build some smart contract we just didn't launch it in public but actually we do have some experience on that but and when we do this web two style crypto product it's more like we thought it's a good way to talk to more crypto company.

4:31 Yeah, that's the actually ends up most of the customer are account as we saw. Yeah. And and so was the was the accounting SAS was that aimed towards like Yeah. Yeah. So but we we just found when when there are more innovative crypto protocol like synthetics and Uniswap came out then we just found okay now it's time to go back to divine and learn from there.

4:55 Absolutely. And I I think I mean like you said Uniswap synthetics those were really big unlocks in terms of like what we could see was actually possible to build on chain and like what did the first iteration of Perp Protocol look like? Oh, in beginning we want to try to just see if we can apply this AM to future.

5:14 We the the first version of white paper is actually a a future with expired date but that we found per is more popular and actually it's easier to build. I mean based on our mechanism although our vi is not a good design but we just you know learned the lesson along the path along the way. Yeah. Yeah.

5:37 And then taking it to perp v2 which I think was a little bit after Uniswap v3 launched. Yeah. What and you take all the learnings from from perp v1. What was like the big transition? Obviously using unisoft v3 as a back end. What was that like? One of the key problem of v1 that this kind of like full range maker doesn't work.

5:58 Yeah. And we think maker need to have more control on the what the range is and I think we saw this a good fit but actually I think V2 is still I mean our per V2 doesn't still doesn't achieve our the performance we're expecting. I think we also have the same challenge as in swap. I think it's just too hard for LP to to manage the position.

6:20 Even it's already very similar to like order book. It's the arrange order is still it's still too hard for both retail and even like institutions. Yeah. And I mean it's just not even efficient. Half like the majority of the liquidity is just not even going to get used. And was that like the big bottleneck on the model?

6:41 Was that I mean obviously with per you've got to get the traders and you have to get the liquidity providers. Like was that the the bottleneck for you guys was the LP side? I think getting liquidity provider is okay. I think the problem is how build I think problem is how to keep them stay actually we we when we do when we build our when we run our V2 so actually we we try a lot of different strategy on top of V2 or V2 something like J maker or a maker that you will just instantly hedge on other spot market.

7:15 Yeah, but those are I mean trend by Uniswap the xyk it just make everything a lot complicated because it's not designed for this this strategy. So this why we iterate to our V3 to be more not it's not even XYK just a very modular design that we can just apply to any kind of mass that can build and not even for some like kind of kind of like a hybrid model that will touch like centralization routing all these areas of liquidity and like getting access one thing I thought was really cool about this is bringing access to centralized exchange liquidity into an onchain system and I was actually interested like how how do you even technically achieve something like that?

8:00 It we just make the the the maker I mean the the the maker more module that you just need to actually it's very similar to in swuah v4 so like a like the hook so you just have a yeah but like the hook without the xyk so even more like abstract away from those those math but I think technically it's not that hard we just need to sacrifice something else for for some could be like a permission vote M maker then you can do something that's super flexible ends up we found key challenge for for many of the perex I think it's it's it's still very hard to compete with centralized exchange absolutely we we always think one of the key advantage of DeFi I mean at least for perex composibility of course there's there's

8:52 Always privacy for every device that you don't need to do KYC and I think it's relative weak if we want to know go bigger than centralized exchange we found it's getting harder and harder when most of the liquidity are going kind of like CDI like order book and all or even moving to other chain then I think our assumption on the advantage of this composility become weaker and we actually are becoming more bearish on decentralized perpetual exchange I mean when we're thinking about how to compete with centralized exchange Yeah, I think a lot of PERPS teams are kind of in the same space that you are right now thinking about the order book model.

9:35 A lot of teams are transitioning to like an order book that just like settles on chain. So you have like a fully offchain order book matching engine and then you just settle the trades batch upload them to the chain and then like commit the state and then in that sense the chain just becomes like a proving ground to just like prove that this is the state of the application and then also allow for folks to be able to still permissionlessly like deposit and withdraw but all the trading is actually happening offchain.

10:05 Is that like a direction that you guys think that you'd head in the future? What's your take on this? Maybe could be the future but I think that's not the future we want to join and we want to contribute. I I personally thought there's no reason that oh once this kind of order book model becomes very big there's no reason that you will you will have some regul regulation issue and it's very easy to know regulate it.

10:34 Another example is like dYdX they become more decentralized after their V4. Yeah, the latest version or whatever. I'm not sure but everything goes becomes worse. I don't know. I'm actually not following this very closely but I feel like they have more downtime in the performance scale. Yeah, I think there just there is just always the trade-off that if you want to go if you want to be more decentralized actually don't know why I end up in ends up will become a centralized I just couldn't find the how you can compete when all of the perpetual tax will be regular exchange if they all the perpetual exchange will be regulated what's the advantage of Dex yeah there's no differentiation in that sense so I mean I guess Really the ideal would be how do we have

11:27 The market depth and the execution prices of CeFi and also the UX of CeFi but still have it be completely decentralized and onchain and I think I mean this is the ideal. How do you guys think that we could get there get where get to a more decentralized perex or to like CeFi competitive? I think Hyperliquid was like a it was a big step in that direction.

11:52 I mean, obviously they're still using like an order book, but like in terms of UX, I think they had like a massive step forward in in UX and a lot of teams are looking at that and starting to like, okay, we definitely need oneclick trading. We need all of this stuff. And then it sometimes it just comes down to latency with like a lot of these like oracle based settlements, it's like if you're going to use Pyth, there's like a number of seconds that you just have to have to wait.

12:17 I mean, there's Pyth Lazer. I don't know if you guys have checked out Pyth Laser at all, but it's supposed to be like super low latency, like hundreds of milliseconds pricing, which which is pretty cool. But yeah, I mean, what does So, I know you guys are you're in the works on like what what kind of features are you guys emphasizing to address that and try to get to UX parody with like a CeFi experience?

12:41 Okay. no. we think is more definitely more efficient than most of the other structure we have so far but we don't think it's suitable for blockchain. It's I mean when we talking about how do we compete with central exchange it's always a worse version of order book comparing to centralized exchange in all I mean in all dimension.

13:05 So we used to think okay there must be some kind of new structure that's not 100% order book but that's more suitable for blockchain because order book is this was designed in a different paradigm blockchain has different constraint there must be something that's more more suitable for for what we our environment is so we keep trying different different ideas and that's what we are working on for the v3 but I feel like the industry is not going this way.

13:32 Yeah. Yeah. And so and one of our the one of the key assumption is that we can leverage any other liquidity but there are I mean because we can compose them and then to provide a better solution that's even better than centralization because that's something they cannot offer. We don't want to compete with them on the same dimen dimension when they're already good at something like speed price.

13:53 I think yeah since the the industry is not going this way. So we are actually kind of like already post the development of the per our per v3 but focus on other strategy that want to leverage the the better infrastructure that could offer a better experience so we can acquire more retail that doing something that's not leverage trading but then once we acquire like a top of the funnel and then once we get that once we have them then we can pretend to use per even we don't think we don't think a per has significant compared to centralization but we try to focus on other thing that we can have advantage compared to centralized exchange.

14:33 Yeah, I see. So well first of all just kind kind of going orthogonal to what everybody's trying to move towards order book and they're trying to move towards like what is a CeFi experience and just saying we're going to have a completely different proposition. We're going to attack it from a a different a totally different way because yeah I mean I think you're totally right like you don't want to compete with Binance on like an order book.

14:54 I mean they have like like their orderbook API is like the standard API that everybody is like copying and everything. So yeah I mean they they have a massive advantage with liquidity with like product iteration and all of this stuff. So, I I think that's generally a good idea. And you mentioned like, hey, that's not even our front-end offer.

15:14 Like we want to have a front end that is acquiring retail users into the ecosystem and then you can give them the per experience on the back end and sort of retain them and you know increase like the lifetime value of a of a retail user. So what is the front end for you guys at Perp Protocol?

15:33 Yeah. So name them called. So we're actually struggling to know it if our focus become something else then but anyway so we end up have another brand but it's still under per called Nekodex. So it's like a mobile friendly Dex that that you can trade right now you can trade it most of the popular EVM token. Yep.

15:57 Without gas and seed phrase. So it's just like a super user friendly mobile deck for any kind of user for we are targeting actually for the central exchange user who want to who used to try to try DeFi but they think it's too hard to too to use but now we want to offer better probably the only place the only product they can use to access D5.

16:21 Yeah. No I I love this. I love the idea of actually taking like I don't know what I feel like business principles and actually applying them to to DeFi. So the offer with with Nekodex is like a really consumerfriendly way to access coins that you probably can't access in like a CeFi experience but still be able to use those in a seamless way and not have to like bridge around and like get your tokens on some on some blockchain and like you have to get the gas token and all this stuff.

16:50 So yeah, I think that's a that's a great value proposition and like what specifically is the way that you guys go to market with this like what channels are working best for you guys to acquire customers with this now? we of course actually we are working on one of the biggest concern is actually Ethereum itself during the last I don't know like one or two years most of the points that people are interested is already in Solana we're actually expanding to I mean that's what what's our focus on for the Nekodex V2 so we are expanding to not even just Solana but for all others like apples sweet I think one of the hypothesis is I don't care.

17:32 Don't care change. But we're thinking maybe well I'm not sure but maybe next time next cycle it's not when people tracoin maybe it's not so maybe it's in other and we just want to have that flexibility to cover most of the chains. Yeah. To give access really in a seamless way because I think I mean every chain they have their own ecosystem.

17:55 They have their own like tech stack of hey you've got a bridge here with like layer zero or you've got a bridge here with a cross or you know whatever it may be. But if you guys become the layer that just takes care of all that technical overhead of hey we got to get funds to this chain to get this and just eats all that up for the user then I mean really you guys are in a position of power here where you own the users.

18:17 You're you're the the entity that actually goes out and is advertising the end opportunity to retail and then bringing them on board. And I mean I think we're going to move in a direction where the folks who have all the users are going to be in like a distinct position of power because I mean now if you've got 100,000 users that you can bring like if you add another chain and they immediately get access to your 100,000 users that's going to be a huge value proposition.

18:45 And I mean it it seems like you guys are thinking about it in the same way. But so I mean let's talk more about Nekodex omni chain access to liquidity across you know ultimately every ecosystem that exists. What is the technical feat there? Like did you use like what's what's the underlying here? Is it layer zero? Are you using all kinds of different bridging applications?

19:08 How does this work? so right now in RV1 we are using Across as the the main intent intent swap infrastructure and also use another for account abstraction because we need to handle the gas. So we use ZeroDev as our main account abstraction solution but for non-EVM upcoming non-EVM chance we're considering to use relay but we actually already build something very similar I mean relay is another bridging solution yeah we we are still evaluating should just build use our own but but anyway when we need to integrate that something other than third party doesn't support then we will utilize what we have built now it just there are just some liquidity issue we need to solve when we use our own infrastructure.

19:55 But yeah, we can handle that. Yeah. And and like what what is the the deciding factor when you're considering like all these different options? Like there's layer zero, there's across which you guys are already using and this of course relay. What are the important features for you guys? Is it it's the liquidity and like availability of these chain swaps?

20:15 Like what are the considerations? Yeah, availability is definitely probably the most important thing. We used to compare decentralized very much. But now since we are more targeting to retails and we saw no matter how decentralized the infrastructure it is, we have to take some responsibility to make sure won't happen or if happen then we have to deal with it.

20:39 Now we are more focused on like like the time to market and and the coverage of the change. Yeah, absolutely. And making sure that there's no crosschain risks. I mean, of course, building a crosschain is always a headache. You got to think about like reorgs and all this stuff. And I mean related to that, what has been your your approach to like smart contract security?

21:00 I mean, being in the space for six years and I don't I don't think you guys have ever had like a security incident or anything like this. What what has been your approach to achieve that? Okay, so we we run a pair programming. So every code is written by two engineers and then just like everyone else we will definitely have like internal audit and external audit and for a bigger launch we have more than two independent audit auditing firm and last time we try Sherlock as a like a auditing camp it seems like it's a new trend for auditing it didn't we don't have that kind of platform like four or five years ago and then we have of course the bounty think probably I mean not not not very special compared to everyone else

21:48 I guess. Yeah. I mean but I mean well I mean that's interesting the pair programming aspect. I don't think I've actually seen that at a lot of a lot of DeFi companies at this point. What does that look like for like what is the day-to-day? Is it like all like heavy pair programming or is it a little bit more async?

22:06 Like what's the approach there? maybe our team is older than average. I don't know. we're most of like 30 to 40 but I mean so most of us are I mean programming is quite hard popular in like ' 90s so actually we like we try to force everyone to do 100% pair programming to although most of us are work remotely but we still like just most of times will be one developer who may know the spec more who know the technology more speak then another one who may know less type but this is also good for sharing the knowledge especially when in the beginning we inform the team not many people not all of the teammate know perpetual contract work or how defi blockchain but it's a great way to share knowledge and it also

23:00 It's also a great way to make everywhere to be more full stack so we do this not only for smart contract but only also for front end and back end so most of us will know something better but you will also share the knowledge so we will have less bottleneck. I mean the knowledge bottleneck there still sometimes there's still some bottleneck but at least I think it's a good way to actually feel in long time is still faster if we consider the full development cycle it's it's still depends on if your team is get used to it because in the beginning I think most of the developer will not like this absolutely no I mean you're you're bringing me back to my university days and compai they would they would force us to do like

23:47 Pair programming and of course like don't like it at first but as long as you get a good partner to pair program with then of course like it can be a really valuable experience. Yeah that's interesting. I don't think like we don't see enough teams like trying out different ways of collaborating and totally agree. I think the context problem in an org like especially as orgs start to grow and you start to get you know dozens of engineers then that starts to become like really dangerous when you have siloed information you know this person wrote like the v2 of these contracts and only they know about this like formula and then what happens if they leave then it's like then that I mean essentially that information is just lost.

24:26 So yeah, I mean this is a great way to address it from like the development cycle stage early on. And I mean how big is the is the team at at Perp Protocol? We have 20 and around more than have like 12 has as our engineers. Okay. So yeah, 12 technical folks. That's that's pretty big. I mean that's that's around the size that we're at as well.

24:51 So we're probably having a lot of the same issues in terms of like org and management. and what is the what does the overall structure look like? So you have 12 engineers like what's the what's the manager structure? Do you have like an engineering manager? What's what's we only have one project manager and and that's it. But from this engineer there also two design engineer I think that maybe there one different thing is we don't have a pure designer our designer also commit.

25:17 So so we call them design engineer. Sometimes it will pair with other front end but mostly they will just do most of the UI work. So most of our full stack so we can build a front end code but mostly focus on the logic side. So design engineer can can build. So that that may need some project managers support but I think most of time it just like one project manager can is enough.

25:38 Yeah. And I mean I will say it does get hard especially because you guys are I mean you've got folks that are front end, you've got folks that are backend and then I think you guys are also working on mobile at the same time. So I mean there's a lot of different stacks to think across. So I can imagine there's like difficulties there but probably the pair programming aspect helps with this and and getting you know kind of like sharing the knowledge across everybody.

26:01 So yeah I mean I can definitely see how that's that's working out well for you guys. And in terms of like hiring, I mean, you guys have been in the year in the space for six years. How has hiring been for you guys? It's always a pain point for everybody that I talk to like how do we get the right folks in DeFi?

26:18 But I'm sure it's gotten easier for you guys as as time goes on and get more folks in DeFi. But like yeah, what is what has your approach been? Has that been a big bottleneck for you guys? feel is is pay for us when engineers developers maybe both my co-founder and I are technical background and we have I think we're old enough to have some network to to convince our friend to join beginning and then everything goes a lot easier once we have some really good teammate I mean engineer our team it's definitely hard to non-engineer like marketing BD but I don't know if it's because our I mean another AI are not technical background or it's just that hard to find some like crypto marketer.

27:01 Yeah. I I mean I think crypto marketing that's like I think there's a lot of development that could be done in terms of crypto marketing. Like I mean even just you saying the fact that Perp Protocol is the back end and Nekodex is the front end. I've actually never heard anybody think about like a like DeFi as a business where you have like a front-end offer and you have a backend offer.

27:24 So, I mean, even that right there is it shows like how early and nent the the industry is in the sense of like go to market and it's not very sophisticated at the moment. I mean, at the moment, your average DeFi protocol is just like here's our product and we're just trying to get people to use it.

27:40 I don't know if like I don't think anybody has any like distinct like ad campaigns. I don't think anybody's measuring like CPM and nobody's like I think all of a sudden it's just kind of like throwing spaghetti at a wall on the marketing front. and I I think I mean I I really like the idea of what you guys are doing where it's hey we have front end.

27:59 This is like a unique offer that we can bring to users and you can market and actually like acquire users that you know at least break even maybe even make money on users and then have the Perp Protocol in the back end to really drive the retainer like you want to retain the users over a long term.

28:17 I think that's like you said is like that's the hardest part of the DeFi business is like retaining retail. I mean if you look at the chart retail is like up and down and up and down. So yeah I mean have you guys taken an approach of like training marketers or like how how do you see the acquisition system in DeFi?

28:36 I don't think we do any training internally just by we can hire the best one and then we can learn ourselves but maybe there's something we can improve but anyway for the like acquisition we do I think the the one the most challenging thing is the the the the number are just too slow too small so we don't even have enough like the the big significant result most of the time and it needs way longer when it's still a thing.

29:08 So I think just ends up with I think that we're still in a very early stage that we just just try different things. Yeah, definitely. one thing that's kind of a hot topic in crypto lately is AI and like using AI to write smart contracts, but you know going back to that team structure size, have you seen AI kind of change how the way things are done at per are you using it in any capacity?

29:29 Like what what are your thoughts on that? Actually is the my first priority right now. I mean 90% of our team made are working on the next version of Nekodex but I see most of the time when we decide our road map we're always thinking about how we can make 10 times better something that can be 10 times better.

29:49 I think AI is a thing but still I'm we still still trying to figure out the the how like D5 and AI can benefit each other but for like improve the productivity we did a lot of experience internally for example like we start to try to front end 100% by AI we've spend more like 90% of time to write spec and then maintain the spec and then see if we can change the way to work like this and if it's really faster or actually it's slower.

30:26 Yeah, not force but try very hard to encourage everyone to try different AI to and in different way like we just try like I forgot name auto review that yeah know just it's just different things and most of the thing I can see the potential but I feel it's still most of the thing is still not ready to use internally but I can see if we if we have time to build oursel it's definitely can have real impact to our team we do we already have a very positive impact on like code generation.

31:01 I mean like those kind of like building those front end code without manual work because most of our teammates just don't like build front end build UI spend time on this but change to this way like focus on writing spec it actually help us to think clear and end up is just the way to go. Yeah. It almost just removes the like latter half of the development cycle and forces you to do more iteration up front and like really oify your idea here and then you know whether it goes to an AI or it goes to you know maybe even just somebody who's manually creating the UI then it's like you do it once and you don't have to like go back and like start at the beginning again and I think that that part

31:46 Of aspect might be like 80% of the return in terms of like how much time you can save. Has there been any any other use case that you've tried and has just been like, "Wow, okay, we're going to we're going to continue to do this always with AI from now on or is it just kind of like stuff that kind of works?"

32:04 I think there are two twofold. So, one is how it can improve our productivity, but another thing is how it can enable us to build something that's totally different. I actually more interested in the second to enable us to build something different. Yeah, we we do have some like prototype internally. For example, like we just build a like a AI based market that you can bet any topic.

32:29 Our assumption is there are many topic that's too niche that it's hard to build a liquid market but if I can always bet against with you then then there maybe there will be a lot of longtail market that you can everyone can bet anything. there are just different experiment ideas that we're thinking how AI can enable us to build something that's not only better than other but yeah it's still we're still exploring.

32:55 Yeah, I've seen a few like interesting I mean obviously there's a ton of AI vaporware that's like getting funded and and built in DeFi right now. But I have seen a few applications that are pretty interesting in terms of like quantitative models that are making decisions and then they can plug into a network and start moving funds around based on the decisions that are made and having like specific integrations with perexes.

33:23 There's one being built on GMX right now. So I think I think there is definitely an opportunity for the layer that connects AI to the blockchain and and sort of opens up the financial infrastructure to be used by an AI. And I think that will probably be interesting to maybe even hedge funds to be able to come in and use their models cuz they've already got super intellectual models to analyze all this stuff.

33:47 And there's way too much at this point on chain that can't be just manually looked at. there's all these different venues and all these different funding rates and borrowing rates and types of yield that you can get. So I think AI will have some kind of a proposition there. It's just I think probably getting the right type of modular framework to have that like fit in and be able to be modularly adapted to any kind of model and then of course bring in the right models that can actually use this interface and actually make like good moves with it.

34:17 So I mean that that's on the AI front. I know I mean you guys are working on really a lot right now. I think you're also going to mobile. Is mobile is that already out or is that something in the works? What's what's the status actually the V1 is mobile only. So because we we know like most of the activity from central exchange are in mobile and DeFi just super hard to use in mobile.

34:39 So I think that's one advantage to show what our advantage is. But now it's only now we only have al also have a Android app but the the but you can use the PWA so the installing your like a web web instead of a native takes a lot of time they expect to build launching iOS 100%. Yeah.

35:04 And I mean what's it like trying to get on like the Apple store? Are you guys just saying like we're not even going to try and get into the Apple App Store because I know they've got like they're trying to take like 30% of app revenue or something like this like what is the barrier there? yeah, but now we have some technical challenge but we we probably skip this and just focus on V2.

35:26 But the challenge is so first we use pass key. we have some trouble to to make it work in iOS and we we just need to rewrite a lot of the infrastructure, the frying code to make it work and we'll probably just focus on Nekodex. Yeah, I mean it's it's really Apple's got everybody in a really tough spot here because I mean they do control at the end of the day like a large percentage of the users like they just have them on their platform.

35:50 So I mean in in that case like how do you guys measure like what is the next thing that we need to be working on to get Nekodex to to the next like scale of users? How do you guys like prioritize stuff like that? So we think the first the most the most contra the bottleneck of Nekodex is Ethereum.

36:11 So that's why we want to expand also I think the very important factor is the go to market strategy. So how do we get users one of the thinking is now we're thinking about leverage other chance to get user first. We want to focus on the ch other chance maybe they're going to launch soon or just try hard to get user.

36:34 So I think it's easier to leverage those ecosystem partner to get user first and then we can just keep and we and they expand. Oh yeah I think user acquisition is definitely one very important factor that prioritize the road map. Yeah. And I mean speaking of like user acquisition in general, I'm interested. Have you guys ever tried like or any kind of like ad funnel to try and get folks to get the ad?

36:57 Okay. But are you guys even able to like advertise on Instagram and Facebook? Is there like any kind of We try many. I think the challenge is the the time takes like several weeks to convert users to deposit. Deposit is just a a super Okay. that that stop everyone and that I couldn't say what's the reason but there are just so many reason I stop user to deposit like it doesn't look safe it looks scammy and I don't have money right now or I want to rent but it's just so hard I need to do KYC again just we do use interview like every week or once every week just always different reason stop us you said to DeFi if you are not already in defi yeah this is this is a huge I think

37:44 The first team to really crack this will make like a billion dollars. Like this is how we get outside of the bubble that we're already in. Like we have everybody in DeFi who's like willing to put their money into this like crazy like mask popup and like bridge on to change and stuff. But yeah, that that sounds about right.

38:03 That's exactly the barrier where it's like, okay, you can get them to download the app and you have some some cost per app download, but then to get folks to actually deposit funds is like the rate of success for that is so low that it's probably I mean it's just not scalable in terms of like I can imagine maybe your your cost per deposit was probably maybe it was like thousands of dollars or something like this in ad spend.

38:31 But yeah, and I mean your lifetime gross profit per user has got to be like really high to justify that. I mean so trust, do you think it's trust? Do you think there's like just a usability aspect of like I don't even know what this is going to do with it once like what do you think the barriers are?

38:49 I think trust is definitely a very key factor, but it's also Yes, you can always use trust to explain something that why user don't want to use that. Yeah, just kind of like a very general description to say why user don't want to use it. But but yeah, I think I think crypto has a branding problem. So there are just two ways.

39:11 So you have something that you really really want to use no matter how scammy or risky it looks. You just want to try to use it or something very similar to like fintech or bank looks as easy as them. But there are just something slightly unique that so you want to use it. But I think we are still not there yet.

39:31 So even we all only try to focus on user who already use centralization like Binance or Coinbase. It's still hard. But maybe the timing is not right because when we're trying to acquire them, there's nothing special in Ethereum ecosystem. They want to try. Everyone want to try. Yeah. No, I think that's that you're exactly right. It's like how do we get something?

39:52 How do we give them an offer that's like so valuable that it's like I don't even care if this website just runs off with my money. I need to deposit because I need to to get whatever it is that they're offering. Yeah. I mean, what what have the offers been that you guys have put out to the marketplace?

40:08 I mean, because you see like all these betting platforms, they're like, "Hey, deposit and you'll get like $50 free. They have all these different offers." Like, what have you guys tried? Yeah, we also tried some incentive program, but I think there are two things that is something that probably good enough to to attract users. is the higher yield but it only attracts some kind of users and ends up I think it's still DeFi user who prefer yield because for central user if they don't trust you they may lose 100% and they don't want to just just try to earn like 20% but maybe they think they were very likely to lose all of them of course there are some alcoin I mean those kind of long tail asset people want to try and like at

40:47 The end of last year base is quite hard so there are lot I don't know like AI spoken or something Actually, I couldn't remember them, but I think in that time it's quite well, but it died down with droken mudded the water a little bit. Yeah, we've covered like, you know, you mentioned users want to try different chains like maybe Ethereum is not the hottest one right now.

41:07 On the asset level, have you seen what leverage traders want kind of evolve over the years? Whe between it like majors like you know BTC, you know, governance coins were definitely huge in like 2020 and like meme coins lately. Have you seen like what people want to take leverage on evolve or is it if it's tradable they want to you know take a position?

41:25 Well, we didn't focus on leverage trading last year and almost like one or two years. So not sure what's the activity of the leverage trader. I feel most of the activity are still memecoin and maincoin doesn't need leverage. It's already volatile enough and and we do see we do see a lot of as you can see there are many most of the profitable product not project are around Mcoin like used to be like GM GMG or recently there another Exom I forgot they just I think they all focus on this kind of like DJ traders and yeah I don't think they need yeah that's absolutely I mean it would just be liquidating city but that's actually interesting I think you're absolutely absolutely right that the sort of like DGEN like memecoin or just in general

42:13 Like the lottery sort of approach has I think that's done a lot to onboard new users in the past couple of years like I I think the the perpetual products and a lot of these have just been monetizing like existing DeFi users and then it's been like the pump funds that have actually brought in net new people into the space.

42:35 Have you guys thought about that at all? Like I it's almost like for a DeFi protocol in this situation, you kind of have to look at the the human psychology and just figure out like what is it that people want to like they want to play like a little like gambling game on their phone or something. How can we advertise that to them?

42:53 Have you guys thought about any of the I don't know just the psychology of this if you are talking about like do we ever consider to to to try to problem for like main point trader we we've we don't have that confidence because we don't we don't have our team doesn't doesn't have that DNA. Yeah, I think I think it's a good way to acquire new user but I think it doesn't fit us and I hope we can contribute on somewhere else and for example after they trade Mcoin well they want to put their move their profit to some vote or something I think that's something maybe we can do better than others but to help them to trade faster or find next alpha I don't think that's what we are good at.

43:39 Yeah. Yeah. I think I mean at the end of the day it's a targeting issue. It's like you have to figure out exactly what value proposition you want to have and then find the exact segment of users that like are interested in this and then basically figure out how do we target them and target them profitably to be able to acquire them and bring them into the ecosystem.

44:02 Yeah. And I think dealing with retail, there's a whole lot of like interesting human psychology like analysis that could be done. So I'm interested to see what what you guys end up like iterating on and and coming up with. But yeah, is there any like like marketing campaigns you guys have running right now? Any kind of offers that you're pushing at the moment?

44:21 So we have another another token more it's more like a reward or like a point token. We're just trying leverage this and to try different campaign and but we now we just try different campaign and like move move this reward to the here and see how it works does it works for a certain type of people and if it works we just double down I think there just I don't know like more than like three campaign running in parallel now and yeah it just sometimes one of them now but you know sometimes is think one of the challenge to to learning everything It's up and down based on the market.

44:57 I mean, yeah, it's just harder to tell. Is is it because our campaign is good or just everyone is happy now because they are making profit? Yeah. And that a lot of stuff is tough to to deal with, but I think at the end of the day, it's it's like it's a feature of working in the space.

45:13 It's like it's nothing that's ever going to be totally solved. I mean, I think it will get better over time as, you know, crypto goes gets more adoption into the existing financial system that troughs and and peaks will be sort of flattened out. But yeah, it's definitely a feature, not a bug of just the industry that we're in.

45:33 So, yeah, I mean, right now it's it's we're definitely on the down, but hopefully we'll we'll be back on the up soon. And I mean, what kind of like KPIs are you guys examining? like how do you guys measure user acquisition performance to be able to tell if stuff is like actually working out for you guys? So one of our key is a core user.

45:53 Our definition of core user is something like you must have a account value more than like $100 and then you need to like buy or deposit to a vote during the next like 30 the core user want to just try it's like trying to to grow these numbers. Yeah. Yeah. and then iterating and just seeing like what you can what the I'm sure you guys have statistics on like okay this offer is getting this amount of core users for this amount of spend in this amount of time stuff like this and I can actually like underwrite this stuff and make decisions based on data yeah so I mean it's just it's the long grueling process of figuring out like how do we get the the pipeline right to get folks we we okay we can

46:37 Get app downloads how do we get people to deposit and get to this And it's a grueling process, man. But I think as soon as like the first team figures it out, like I don't think anybody has solved this problem in DeFi to be clear like but once they do then it's like if you can predictably get users into your ecosystem that that scales extremely quickly as long as you can keep them on the back end.

47:00 So yeah, I think the position that you guys are in where you've already got like a backend front end and really you're just trying to scale the the front end offer I think is a really exciting place to be. So, I'm looking forward to what you guys are able to figure out on the acquisition side, but I mean beyond that, what are the the big things that are that you guys are working on right now?

47:20 I think you said 90% of your team's working on Nekodex. What's the big project there? So we are working hard to expand more than EVN and also one of the core feature in the beginning is we want to try to partner with different chains to offer card that you can spend your crypto and seems like other chains are kind of very exciting for this kind of car product.

47:45 So that's something working on. I see. Yeah. So the crosschain aspect, the the card aspect, I mean really all of this is is on the front end of figuring out like, hey, how do we make most attractive front end possible? So yeah, that that definitely makes sense. I mean what when can we expect support for like Solana and maybe even like some of these networks coming out?

48:09 Yeah. we actually we already have some pro have some protest but yeah now it's just hard to commit a road map but I hope I think no I I shouldn't say anytime sorry yeah definitely this year but yeah hopefully in a few months yeah of course I never want to give like a distinct date to constrain you guys especially with I mean you know due diligence and security process but yeah dude I mean I I think pretty much we've we've covered like everything top to bottom about what you guys are building is there Is there anything else that we didn't get to that we should cover?

48:42 Oh, yeah. I think we're good. Well, yeah, man. Well, I mean, first of all, appreciate you so much for for taking the time and I think it was really insightful in terms of like your approach to retaining users. I think a lot of D5 protocols are like there like five steps before this even thinking about like, oh, we need to structure the business in a way that a business is.

49:01 So, I think you guys are ahead of the curve there for sure. But yeah, dude, once again, I appreciate you hopping on and of course, we'll we'll have the links to to check out Perp Protocol and of course, Nekodex as well to see a seamless trading experience, get access to all these coins. you know, whatever DGEN coins, whatever utility coins you want to check out, you can use them in a seamless way.