Exactly 0 VCs pushed @tradeparadigm. But don't let the truth get in the way of a good story đ
In fact most VCs didn't even understand Paradigm and most still don't fully get it. Most of our investors were actually our users, all the large trading desks (Akuna, QCP, Babel etc.) 3AC themselves didn't understand the value of Paradigm and resisted it.
Paradigm blew up because instis needed a platform to get maximum size with immediacy, atomic execution on multi-leg trades and privacy. We still clear 35% of Deribit volume everyday and traded ~$50B last month
Most other exchanges that copied Paradigm and tried to compete with Deribit didn't and still don't misunderstand the value of an institutional coverage business which is what Paradigm provides. They copied Paradigm and tried to run it themselves but our edge is not in the tech. It's the distribution. Deribit understood this well and that ethos has allowed it to dominate.
Some reasons why I think Deribit fended off challengers in crypto options space, by year
2018-2019: most ppl thought Bitmex would add options and kill Deribit. They ended up adding daily expiry Up contracts that were priced too high
2020-2021: bit dot com, okex, ftx, binance. Deribit won the b2b corporate market, firms like babel pushed all their flow on. 3ac pushed the long your calls with calls gamma squeeze. VCs mostly felt defi options would happen, but Ribbon and Hegic were only ones to get some adoption, and in the end the real MMs still need to clear risk on Deribit
2021-2022: VCs pushed Paradigm as an otc rfq layer that would eventually abstract out Deribit. Every cefi exch invested in Paradigm. Deribit wisely understood that this would simply bring them more flow and expand the total market space
Deribit wisely resisted all my efforts to get them to launch a token, and wisely resisted efforts to list options on all alts. In the end they won by having high uptime, risk mgmt, consistent product, and professional user focus.
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