Micro-Cap Altcoin to Watch: Switcheo (SWTH)

Jim Makos / Flickr
Voyager
Voyager

2019 is setting up to be a year of decentralized exchange launches. While all eyes are clearly on the upcoming release of the DEX attached to the Binance Chain (BNB), there is one lesser-known project that is worth watching this year.

Switcheo, a decentralized exchange built on NEO (NEO), is unique in that it isn’t focused solely on digital assets built on top of NEO, but instead, is focused on enabling blockchain interoperability to activate cross-chain trading.

Switcheo

The first example of Switcheo’s approach came last November when the platform¬†listed¬†41¬†ERC-20¬†tokens after launching its Callisto protocol¬†update for interoperability. This made Switcheo the first non-custodian exchange to support both the NEO and Ethereum (ETH) blockchains.

The Switcheo platform currently has more than 20 NEP-5 tokens listed, including DeepBrain Chain (DBC) and Apex (CPX). Ultimately, it plans to add tokens from other major blockchains, including QTUM, Zilliqa (ZIL) and EOS. QTUM is expected to be released next but no specific timeline has been announced.

Switcheo’s Tokenomics

The exchange is powered by the platform’s token, SWTH, which can be used to reduce trading fees by 50%. While SWTH tokens do not include a profit-sharing structure like¬†KuCoin, the tokens are burnt when they are used to pay trading fees. This means that SWTH has a scarcity driver built directly into the exchange economics, driving the long-term value by reducing circulating supply.

This is an important fact given that Switcheo has a high total supply of 1,000,000,000 SWTH and the price has collapsed 94% since first hitting the market. It currently trades with a market cap of $1.8 million, making it a micro-cap altcoin.

SWTH/USD via CoinMarketCap

2019 and Beyond

Despite last year’s decline, Switcheo has a ton planned for 2019, including the launch of a direct fiat gateway and the addition of Atomic Swaps, which will allow users to execute cross-chain trades with¬†instant¬†execution confirmation, at the cost of having to trust that Switcheo guarantees that the order maker’s trade will be executed.

Most recently, Switcheo announced the release of a new UI-friendly Switcheo Account, allowing users to better interact with the DEX, just as they would with more mainstream centralized exchanges.

Switcheo’s new account system (Switcheo)

“Users may have coins on other platforms that they wish to trade on Switcheo Exchange. Onboarding can then become a hassle when it involves the creation of third-party wallet for just a few quick trades,” said Switcheo CEO Ivan Poon. “With Switcheo Account, trading on a DEX will be as simple as it is on a centralized exchange, while still ensuring that you have full custody of your funds.”

Final Take

Switcheo is definitely one of those projects that has been development-heavy, with little to show for it in token price. This is largely due to the fact that SWTH is not on any major exchanges and the trading volume to drive the token burn is not there yet. However,¬†Switcheo has also teased an unannounced feature that they hope will improve Switcheo’s overall trade volume — scheduled for release in mid-February.

Based on the exchange’s current developments and future potential, it may be well-positioned to ride the impending wave of excitement around decentralized exchanges.

More: Decentralized Crypto Exchange Switcheo Adds USD-Pegged Trading for NEO
Similar: Micro-Cap Altcoin to Monitor: OAX (OAX)
Photo: Jim Makos / Flickr

Disclaimer: This article’s author has cryptocurrency holdings that can be tracked here. This article is for informational purposes only and should not be taken as investment advice. Always conduct your own due diligence before making investments.

 
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