The Best Crypto Companies Around The World

Get exclusive deals from crypto companies:

Ellipsis Labs Raises $20 Million Series A Round for Crypto Exchange Phoenix

Jonathan Wong

Jonathan Wong

05 April 2024

Ellipsis Labs, the team behind the decentralized exchange Phoenix, has announced a $20 million Series A funding round, led by Paradigm with participation from Electric Capital. The funding will accelerate the company's mission to create a new financial ecosystem that offers competitive financial products on high-throughput blockchains, merging DeFi's accessibility and transparency with the efficiency of traditional markets.

Phoenix, Ellipsis Labs' debut product, launched in February 2023, with its public-facing user interface going live last August. It aims to address the liquidity issues in decentralized exchanges by providing a peer-to-peer marketplace where crypto traders can make transactions directly, without intermediaries. Despite lacking the liquidity to rival centralized competitors like Coinbase, Binance, or Kraken, Phoenix has become the fifth-largest decentralized exchange by trading volume in the past 24 hours, with hundreds of millions of dollars in daily trading volume.

Co-founded by Eugene Chen and Jarry Xiao, who pursued careers in high-frequency trading after meeting in middle school, Ellipsis Labs aims to build DeFi products that are comparable or even superior to centralized venues. Phoenix's key focus has been to attract market makers without offering external incentives, making the exchange self-sufficient. The raise, closed early this year, will be used to expand the engineering team and continue innovating on on-chain financial primitives.

The decision to build Phoenix on top of Solana was driven by the need for active liquidity and high throughput with low fees. Every time a liquidity provider places or cancels a limit order, they take on the blockchain's gas fees, making low fees essential for sustainability.

"We've known and respected Eugene and Jarry for several years, and we're excited to formally partner with some of the most ambitious and principled builders in DeFi," said Matt Huang, cofounder and managing partner of Paradigm.