Avalanche DEX Trader Joe Plans to Make its Tokens More Valuable for Users

The platform aims to expand to Arbitrum and BNB Chain in the coming weeks and is changing part of how its tokens are rewarded and distributed.

AccessTimeIconJan 19, 2023 at 11:00 a.m. UTC
Updated Jan 19, 2023 at 3:40 p.m. UTC
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Shaurya is an analyst/editor for CoinDesk's markets team in Asia.

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Trader Joe, a decentralized exchange (DEX) on the Avalanche blockchain, has announced plans to bolster the utility of its native governance token JOE and other ecosystem tokens, developers wrote Thursday.

Developers plan to bridge JOE tokens once the DEX is live on Arbitrum and BNB Chain, two other blockchain networks. JOE will be the governance token on those networks, with one JOE equal to one vote on Trader Joe’s governance forums, where holders can propose and decide on strategies or improvements for the platform’s future.

In addition, Trader Joe plans to provide stakers with a share of trading fees accrued on the DEX through staked joe (sJOE), a token given to users who supply JOE to the DEX in return for rewards.

Such fee rewards are currently only available on version 1 of the Trader Joe platform, but as part of the version 2 launch expected in February, sJOE stakers will be able to receive a share of trading fees for all chains, including Avalanche, Arbitrum and Binance. sJOE deposit fee will remain at 1%.

Trader Joe is one of the largest DEX and lending services on Avalanche, locking up over $88 million worth of tokens as of Friday. The platform previously announced its move to Arbitrum – its first-ever deployment on a separate network – in December, as CoinDesk reported.

The DEX captured $2.5 billion in locked value at its lifetime peak in 2021 and continues to attract the highest transactional volumes among all Avalanche-based products, DeFiLlama data shows.

Trader Joe’s Liquidity Book – a product that claims to make DEX trading more efficient by reducing slippage and improving capital efficiency – will be rolled out in the launch.

As part of the Liquidity Book Rewards program expected in February, holders of vote-escrowed JOE (veJOE) holders will be able to receive “boosted” JOE rewards. These rewards will continue to be offered only on Avalanche, however.

These veJOE tokens were part of a rewards program that allowed users to lock their tokens on Trader Joe for a longer length of time in return for greater yield. Doing so allowed Trader Joe to improve its liquidity while continuing to incentivize users.

Meanwhile, the Rocket Joe program, which aimed to provide liquidity to new products launching on Avalanche, will be deprecated.

“Since mid-2022 Rocket Joe has not blasted off and this raises the question around the use-case for rJOE staking,” developers said. “With the 2023 direction of the Decentralized Exchange, the decision has been made to deprecate rJOE staking, this decision is live now and rJOE staking is now no longer accepting new deposits of JOE.”

All stakers of rJOE will receive a commemorative non-fungible token (NFT) as a reward for their participation.

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Shaurya is an analyst/editor for CoinDesk's markets team in Asia.


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Shaurya is an analyst/editor for CoinDesk's markets team in Asia.