Coin World News Report:
Authors: Derek & Alana Levin, Variant Fund; Translation: Financial Xiaozou
We are excited to announce that we have led the seed round financing for Satflow, a new professional trader DEX based on the Bitcoin network.
1. Why choose Bitcoin? Why now?
Variant has been tracking the Bitcoin ecosystem for many years. In the past 12 months, we have noticed three potential trends that are in the early stages of generating new waves of development experiments and user interest:
(1) Development of new asset forms
For years, the community has been opposed to development and construction on the Bitcoin base layer. However, public appetite seems to have changed. This is the first time we have directly tokenized on Bitcoin. The release of Ordinals, BRC20s, and Runes standards represents significant progress in increasing the productivity and transaction volume of tokens on Bitcoin. Each new token standard improves the token trading experience (for example, Runes is the newest and most interchangeable among the three standards, and it can trade more decentralized dollar funds). We believe that the experimentation of new asset standards on Bitcoin will continue from here.
(2) Major efforts to make Bitcoin and its ecosystem more programmable
The Bitcoin ecosystem contains nearly 900 billion dollars in potential capital. So far, the limitations of the Bitcoin script language have been considered the core obstacles to building expressive applications around this capital. But we have begun to see meaningful new attempts to expand the utility of Bitcoin. A core protocol upgrade called OP_CAT is underway, which will enhance the ability to build applications directly on L1. Broadly speaking, at least a dozen Bitcoin smart contract layers (commonly known as “Bitcoin L2”) have received venture capital. Various efforts are collectively transforming Bitcoin into a powerful and attractive development platform.
(3) Institutional adoption and interest
Institutional adoption and interest have been driven primarily by the launch of Bitcoin spot ETPs. Since its launch in January of this year, ETPs have attracted over 70 billion dollars in new investments. Research shows that owning assets can generate stronger interest and loyalty from consumers when making purchasing decisions. We believe that owning Bitcoin may have a similar effect: as more and more users start holding Bitcoin in their investment accounts, curiosity about what else people can do with Bitcoin will grow. Over time, this will attract more interest and more new users to interact directly on the chain.
The impact of these positive trends is that in the past 12 months, the Bitcoin ecosystem has received more resources, developer mindshare, and user attention than at any other time in its 15-year history.
2. A DEX designed for professional traders
As the Bitcoin ecosystem develops, the diversity of users is also increasing. There is now a growing community of professional traders conducting direct trades on the Bitcoin network. However, innovation in this group has lagged behind, especially compared to professional tools and exchanges in other ecosystems. Satflow changes all of this.
Every transaction in the Bitcoin ecosystem has three core stakeholders: buyers, sellers, and miners.
– Miners want to maximize their fee income.
– Sellers want competitive bids and fast execution.
– Buyers want reliable execution, large inventory, and sufficient liquidity.
Today, many DEXs tend to focus on only one or two of the stakeholders. Satflow has built a DEX that considers the interests of all three stakeholders, resulting in a first-class trading experience, especially for professionals and market makers.
Supporting the Satflow system is an innovation called Memflow. Memflow is an infrastructure that consolidates and displays real-time mempool data for buyers on the Satflow interface. It also helps categorize transactions and provides reliable data streams on-chain for key events, whether it’s new coin minting, major trades, or runic creations.
Before Memflow, buyers and sellers had to wait at least 10 minutes (the duration of Bitcoin block confirmation) to discover asset prices. Even for the most patient Bitcoin traders, this delay makes the Bitcoin trading experience far less smooth than trading on blockchains like Ethereum or Solana. Memflow solves this problem and does so in a way that serves all stakeholders. By accessing high-fidelity mempool data, the trading counterparties in the order book can trade with unconfirmed assets in the pool. Buyers can see inventory updates in real-time and adjust their positions accordingly. Sellers can have a clearer understanding of buyers and at what price their assets will be sold. Additionally, miners can benefit from increased fee income from a more active market.
Satflow’s founders Robert, Alex, and Anatolie are well-prepared to seize the opportunity of building a DEX designed for professional traders. The three founders are early experimenters with Ordinals in the Bitcoin ecosystem – both as collectors and active traders. This gives them firsthand understanding of the challenges faced by existing infrastructure and has earned them the respect of traders and developers who are deeply loyal to the broader Bitcoin ecosystem.
Over the past six months, their DEX has been in the testing phase. They meticulously planned visits from over 250 Bitcoin traders and fine-tuned many features to provide the best on-chain trading experience. The DEX is now live.
