Secondary Token Markets

SecondSwap launched its mainnet on Ethereum on Thursday, aiming to provide a more efficient market for illiquid assets by eliminating intermediaries and establishing fair token value in the open market.

SecondSwap employs a liquidity routing algorithm to optimize trade execution and minimize price slippage, ensuring secure and scalable trading experiences for both buyers and sellers.

> “By introducing a decentralized order book-style exchange, we are bringing transparency to token secondary markets,” said Kanny Lee, the founder of SecondSwap, in an email to CoinDesk.

“Our platform provides visibility into buy and sell orders, leveraging price discovery mechanisms such as market depth and liquidity profiling. Through seamless wallet integration, we ensure proof of control for sellers and proof of funds for buyers, enhancing security and trust.”

Secondary markets for locked tokens refer to platforms or mechanisms where tokens that are under some form of lock-up or vesting schedule can be traded before they are fully released or unlocked.

These markets enable holders of locked tokens to achieve liquidity, allowing them to convert their holdings into cash or other assets prior to the full unlocking of tokens — thereby providing early liquidity to sellers and opportunities for buyers to acquire assets at a discount.

SecondSwap has initiated a bid campaign to facilitate price discovery and enhance liquidity in the initial weeks, enabling traders to set their own prices and match buyers and sellers once the buy/sell flow feature is enabled.

Traders can link their wallets to access a list of locked tokens they’re interested in purchasing by setting their preferred price target. Participants will receive notifications when inventory is available at prevailing prices, ensuring early adopters can engage with new opportunities as they arise.

The platform has plans to expand to the Solana network in the coming months, a move that Lee predicts could unlock over $500 million in volume.

> “Locked token liquidity represents billions of dollars of untapped value. The impact of unlocking this liquidity cannot be understated. Activating just 10% of dormant liquidity on Solana could inject over $500 million in actionable volume,” Lee stated.

“It’s definitely one of the drivers for partnering with Solana at the outset. Coupled with the impact that SecondSwap’s vesting mechanism can offer memecoins to reduce circulating supply, the Solana partnership will continue to flourish and benefit the wider market.”