Crypto Trader Dexterity Capital Launches Token Consulting, Market-Making Arm

DCLiquidity aims to guide crypto founders through their project’s earliest days.

AccessTimeIconMar 17, 2022 at 3:01 p.m. UTC
Updated Mar 17, 2022 at 3:19 p.m. UTC

Danny is CoinDesk's deputy business editor. He owns BTC, ETH and SOL.

Quant trading firm Dexterity Capital is spinning up a market-making service to help get budding crypto projects off the ground.

Called DCLiquidity, the new business wing aims to guide early-stage founders through the sometimes thorny technical, tokenomic, economic and legal mazes that precede even pre-seed funding rounds. Following the launch, it will make a market for the project’s token until liquidity builds naturally.

“Until then, you’ll need someone like us just to make sure that a normal trader will look at your product and say, ‘Hey, listen, there’s enough organic [liquidity] – be it order-book depth or tight spreads – for this to be worth my time to trade,” said Arpan Gautam, Dexterity Capital's head of business.

It’s a change of pace for the hush-hush proprietary trading firm. Dexterity’s high-speed algorithms swapped $1.2 trillion in tokens last year, Gautam said; they now execute up to 200,000 market-neutral trades a day.

Larger competitors run similar token-startup consulting services. The thinking goes: it pays to hire someone who knows someone – be they market makers, exchanges or venture investors – if you are a pre-launch founder.

A source at one big-name trading firm said its consulting line is seeing plenty of activity, one sign of founders’ hunger for guidance.

Some early projects navigate the liquidity labyrinth by adding well-connected market makers like Jump Capital or Alameda Research to their cap tables. DCLiquidity may itself invest in certain projects it supports, but not all, Gautum said.


Read more about

DISCLOSURE

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.

CoinDesk - Unknown

Danny is CoinDesk's deputy business editor. He owns BTC, ETH and SOL.

CoinDesk - Unknown

Danny is CoinDesk's deputy business editor. He owns BTC, ETH and SOL.