AirSwap launched several new features for users of its decentralized exchange on Tuesday, including a decentralized NFT marketplace, new over-the-counter (OTC) trading features, and voter rewards.
The move to support a broader decentralized economy aligns with AirSwap’s ethos, co-founder Don Mosites told Decrypt in an exclusive interview.
“The underlying mission is to bring the idea that decentralized trading is good for everyone to NFTs,” Mosites said. “Centralized venues over the years have grappled with multiple issues, whether its hacks or mismanagement—you run the same risk with NFT platforms.”
Launched in 2017 by founders Michael Oved and Don Mosites, AirSwap is a cryptocurrency exchange that lets users buy and sell digital assets without a third-party intermediary. In 2020, AirSwap’s original developer, Fluidity, was acquired by blockchain software technology company ConsenSys in May 2020. The last major update to the AirSwap decentralized exchange launched in November 2021. (Disclosure: ConsenSys Mesh is one of 22 investors in Decrypt.)
Also known as a DEX, a decentralized exchange uses smart contracts to facilitate trading between individuals but does not require them to deposit the coins before the trade can occur. Other popular decentralized exchanges include Uniswap, PancakeSwap, SushiSwap, Balancer, and Curve.
While proponents of decentralized exchanges champion the benefits of their peer-to-peer systems, DEXs have become a tempting target for cybercriminals.
In July, the U.S. Department of Justice charged engineer Shakeeb Ahmed with defrauding an unnamed decentralized exchange and allegedly stealing $9 million in crypto in 2022. In August, RocketSwap—the second-largest decentralized exchange by trading volume on Base—was hacked for around $866,500 after a private key was compromised on their servers.
In addition to the new NFT marketplace, another feature of the updated AirSwap platform, Mosites said, is a more robust OTC trading service, built because the development team wanted to create a space for digital collectibles and design an open-source front-end that can be adapted by community members.
“We wanted to produce a front end that projects can take for themselves, configure, and run on their own,” Mosites said. “So they have their own decentralized NFT marketplace for their collections that their communities can rally around.”
Integral to the AirSwap ecosystem is the AirSwap DAO (decentralized autonomous organization). A DAO is a business structure where control is spread out amongst members. Like DEXs, DAOs use smart contracts, with participants using governance tokens to vote on topics such as fund allocation.
The DAO label in recent years has often been liberally applied in the Web3 space. However, Mosites insists that token-based voting remains at the heart of a genuine DAO.
“The purest form of a DAO is a token-based voting system that's able to execute changes in an autonomous way,” Mosites said. “Whatever power you give, it’s up to the designers and is a limited set of functions. It's really a decision-making engine that anyone can participate in, and it is economically driven.”
The updated AirSwap DAO voter rewards program aims to incentivize community members to actively participate in the DAO and uses the popular decentralized voting system Snapshot to incentivize DAO activity.
As Mosites explained, members stake swapped tokens to gain voting power, and a portion of the protocol fees goes into a reward pool for those participating in the decentralized governance of the DAO. AirSwap claims that since 2021, over 32 million AirSwap AST tokens from over 350 active members have been staked to the existing voter rewards system.
“A lot happens in six years,” Mosites said. “We look forward to the next six years and welcome other projects and companies to join us on the path to opening up their missions—by putting power into the hands of builders and the people and groups they serve.”
Editor's note: This article was updated after publication to clarify members of the founding team.