Macauley Peterson

Ribbon DAO token holders have voted in favor of folding Ribbon Finance into the affiliated Aevo derivatives exchange, which <a href="https://blockworks.co/news/aevo-mainnet-launch">launched its mainnet in June</a>.



Under the proposal, the Ribbon Finance dapp will be moved under the Aevo domain, and Ribbon’s existing structured products will adopt Aevo’s visual identity.



The near-unanimous vote by 133 RBN token holders, which <a href="https://snapshot.org/#/rbn.eth/proposal/0x68cddae9c345383838357d5e61e0d07b2263ad541e40c4ae84de829ccee673e2">concluded</a> Tuesday, also authorizes a 1:1 token conversion from RBN to a new AEVO token, yet to be launched.



According to the <a href="https://gov.ribbon.finance/t/rgp-33-merge-ribbon-finance-into-aevo/709">proposal</a>, “Aevo will be converted into a DAO, allowing tokenholders to govern the options and perpetuals exchange, OTC, the existing structured products, and the Aevo L2 rollup itself.”



Blockworks Research analyst Ren Yu Kong <a href="https://app.blockworksresearch.com/assets/rbn/governance/22726">called</a> the proposal “a fantastic one for the RBN token and should greatly improve tokenomics, and &#8220;shininess&#8221; surrounding a new token.”



Ribbon currently runs 16 DeFi options vaults (DOVs) on Ethereum, with a share of revenues directed to RBN token holders who lock their tokens for a fixed period of time, and receive veRBN in return.



But the protocol has struggled to scale, prompting the team to pivot to Aevo, a non-custodial options and perpetual futures exchange built as a layer-2 rollup using the Optimism stack. This uses an off-chain order book familiar to traders on centralized exchanges.



Once enacted, veRBN can unlock their RBN tokens without penalty and migrate them, while vault revenue sharing will be stopped, pending a further proposal on AEVO tokenomics.



The protocol’s developers and investors all agreed to re-vest their own token allocations for an additional year as part of the process.



<h2 class="wp-block-heading">What’s in a name?</h2>



Most governance discussion on the project’s forum and Discord was favorable to the proposal, but some questioned the relative merits of the two brands.



“Aevo will get lost and confused with Aave and others,” wrote one community member on Discord. “Ribbon as a brand clearly stands out.”



The project’s community manager disagreed, calling the Ribbon brand a “limitation,” due to its “heavy baggage” —&nbsp;a reference to problems that emerged following the launch of the RBN token in 2021 after DeFi venture fund Divergence Ventures, a Ribbon investor, was <a href="https://thedefiant.io/drpc-launches-decentralized-rpc">found</a> to have <a href="https://app.blockworksresearch.com/glossary#sybil-attack">Sybil-attacked</a> the airdrop.



“Ribbon is our history, let us not make it our burden,” the community manager said.



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aevo

Ribbon Finance governance approves Aevo brand merger

Synthetix, one of crypto’s DeFi originals, is poised to add to its affiliated product suite.



Founder <a href="https://blockworks.co/news/simplify-crypto-user-experience">Kain Warwick</a> announced plans for a new derivatives front-end to its decentralized trading infrastructure, dubbed Infinex.



The new exchange will be aimed at inexperienced and advanced traders alike, but with features that match those found on centralized exchanges including a non-custodial central limit order book.



Synthetix already has a derivatives DEX on <a href="https://blockworks.co/tag/optimism">Optimism</a>, called Kwenta, but Warwick identified three main problems with the existing offering. For example, to get started, traders must first bridge assets to the layer-2 rollup, swap for sUSD — Synthetix&#8217;s own stablecoin, which is used as margin collateral.



Worst of all for those used to a centralized exchange experience, each order or cancellation must be signed by the trader’s wallet, paying a small fee in the process.



“The objective is to erase any doubts about whether decentralized Perps can compete directly with CEXs,” Warwick <a href="https://mirror.xyz/kain.eth/NHmuyvkRPXB4ck7R38v_ityer-VMZAaIwLGHu1hIDtE">wrote</a> in a Friday blog post.



There are benefits to being on a non-custodial decentralized exchange, and Warwick pokes fun in the post at the now-defunct <a href="https://blockworks.co/tag/FTX">FTX</a> and other centralized <a href="https://blockworks.co/tag/exchanges">exchanges</a> for their unique counterparty risks. FTX collapsed last fall in dramatic fashion.&nbsp;



“It’s become increasingly clear that the impediments to Synthetix Perps growth can be resolved, but this will require a new approach,” he opined. “It requires Infinex.”



The proposed <a href="https://blockworks.co/tag/dex">DEX</a> will be tailored to meet the expectations of traders who use venues like <a href="https://blockworks.co/tag/binance">Binance</a>, requiring only a username and password to access, while remaining non-custodial.



“Infinex generates a new public-private key pair for each user and stores it client-side in the browser,” Warwick wrote, noting the key would only be used for signing trade orders, not to withdraw funds.



The technical implementation details of the DEX were not disclosed. Warwick indicated in an AMA on the Synthetix Discord that they were left to Synthetix’s core developers.



New upstart <a href="https://blockworks.co/news/aevo-mainnet-launch">Aevo uses an optimistic rollup</a> based on the OP stack for its off-chain CLOB. Market leader <a href="https://blockworks.co/tag/dydx">dYdX</a> currently employs a <a href="https://blockworks.co/tag/Starkware">Starkware</a> StarkEx rollup but <a href="https://blockworks.co/news/decentralized-exchange-dydx-to-build-its-own-blockchain">will soon migrate</a> to a Cosmos-based sovereign app chain.



Synthetix’s new DEX will be governed by holders of Synthetix’s native token, <a href="https://blockworks.co/price/snx">SNX</a>, and will not require its own token, Warwick said on Discord. But its revenues will be used to accumulate SNX.



“Infinex aspires to become the single largest LP in the Synthetix ecosystem,” he wrote.



As of the time of publication, SNX’s price has jumped 32%.



The launch of the new project is anticipated to coincide with version 3 of Synthetix’s perpetual futures trading system. That new version is expected to be launched in the coming months.



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Synthetix to go head-to-head with dYdX, Aevo with new DEX proposal

The Singapore-based team of <a href="https://blockworks.co/tag/ribbon-finance">Ribbon Finance</a> officially opened its new product Aevo, a derivatives exchange, to the public today.&nbsp;



Aevo, which was <a href="https://blockworks.co/news/ribbon-finance-to-tap-ethereum-interest-with-options-exchange">first announced in September 2022</a>, has been in a “gated” phase since April, with users needing to hold an “exchange pass” NFT for access.



“Since releasing the gated mainnet approximately 2 months ago we saw over [$70 Million] trading volume and a high of [about $5 million] in daily open interest,” the Aevo team wrote in <a href="https://aevo.mirror.xyz/hV7VYkpk7caoYl2DbOFcSaZRRrK-8NeWqKczrgUff6k">a blog post</a>.



The mainnet is no longer limited to NFT holders, and the platform also began offering bitcoin perpetual futures and options in addition to ether derivatives.



Aevo’s user experience is much closer to that of centralized derivatives platforms such as <a href="https://blockworks.co/tag/deribit">Deribit</a> than has previously been available. Converting users from centralized exchanges to the dex is a major goal, Chief Technology Officer Ken Chan told Blockworks.



“The largest barriers to adoption is the conversion of a usual CEX user to a DEX user,” Chan said, asking rhetorically, “How can we make it as easy as possible for a user that has not used Metamask to perform a trade on our exchange?”



Although Ribbon and Aevo are developed by the same team, they opted for a new brand to differentiate it from Ribbon’s roots as a yield-generating platform.



“We intend to target audiences out of the usual [crypto Twitter] crowd for takers, and we intend to bring some of the structured products ideas we have built for Ribbon to become makers on the exchange,” Chan said, noting that Aevo has an all-new tech stack that doesn’t rely on Ribbon’s protocol in any way.



Aevo uses a layer-2 Ethereum optimistic rollup based on the OP Stack combined with a cloud-hosted sequencer operated by Conduit, a third-party infrastructure provider.



Onboarding consists of signing a transaction to enable trading and then bridging USDC from Ethereum mainnet using a fork of the Optimism Standard Bridge contract, according to its <a href="https://help.aevo.xyz/en/articles/7190795-layer-2-architecture">documentation</a>.



Trading occurs on an off-chain order book, but all trades are settled on the layer-2, making it non-custodial. Placing, editing and canceling trades are gasless, so they don’t require a wallet signature or the use of a dedicated network RPC. The result is a very straightforward process.



The tradeoff is censorship resistance, as the order book relies on a centralized cloud-hosted server.



“We are trying to serve the middle ground of traders who do not mind this compromise,” Chen said.



<a href="https://blockworks.co/tag/Derivatives">Derivatives</a> are a vital financial primitive, orders of magnitude larger than spot trading in most markets, but regulation of on-chain derivatives exchanges is still nascent. Global access to retail traders may not sit well with some financial regulators.



The Aevo front-end can be geoblocked in some jurisdictions, and the product&#8217;s Terms of Use will discourage the use of technical workarounds, Chan said.



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