Capx to Launch on Acala, Bringing Suite of Products for Unlocking Vested Token Liquidity

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Acala

6 min readFeb 8, 2022

We are excited to welcome the Capx team to Acala, bringing its innovative solution for unlocking the liquidity of vested tokens to Acala Ecosystem teams! Capx will build in the Acala EVM+ environment, with plans to launch its Capx Liquid, Capx Exchange and Capx Lend products on Acala within the first week of EVM+ rollout.

Meet Capx

Capx has chosen Acala for its deployment in the Polkadot ecosystem in order to leverage Acala’s decentralized stablecoin, aUSD, as well as the DeFi ecosystem being built on the network. Projects launching their tokens on Acala will be able to leverage Capx Liquid for their token lifecycle management and can issue “Wrapped Vesting Tokens” (WVTs) to their stakeholders. Additionally, Capx Exchange will be using aUSD as the default currency for all buy/sell bids on the platform. Last, Borrowers can further collateralize WVTs on Capx Lend to borrow aUSD from lenders on terms individually agreed upon by the lender and the borrower. More from Capx below on their three core products.

Get to Know ‘Liquid’, ‘Exchange’, and ‘Lend’

Capx Liquid

Capx Liquid is a decentralised application designed to manage the token lifecycle for any crypto project. It allows projects to issue Wrapped Vesting Tokens (WVTs) to the project’s stakeholders. These WVTs are essentially liquid derivatives of unvested tokens. These WVTs can be leveraged by stakeholders to access liquidity.

Whenever an investor invests into a private crypto deal, the investor doesn’t get the tokens immediately. There are vesting cycles defined for the token release date that can extend a couple years into the future. With Capx, the investor can ask the project to vest his/her shares through Capx Liquid. The investor will receive WVTs against his/her unvested tokens that are liquid from Day 1.

WVTs are not only beneficial to the investor, but are very good tools that the project can use to their advantage. If you look at traditional markets, a company takes about 12 years to IPO. If you compare that to crypto projects, the token is listed on a crypto exchange within a year in most cases. It does not make sense to work with the same principles of vesting in crypto as done in traditional companies.

With WVTs, the investors can sell their positions in the secondary market much earlier and therefore the sell pressure doesn’t come to the exchanges. The new set of investors holding the WVTs sit on a much lower upside compared to the original set of investors, hence they don’t bring the same kind of selling pressure on unlock dates. This helps the projects have sustained growth before even the unlock dates for unvested tokens.

Capx Exchange

Capx Exchange is the marketplace for private allocations and institutional dealflow. It is a peer-to-peer decentralised exchange with an order book mechanism that allows users to trade Wrapped Vesting Tokens. A lot of investors today work with OTCs in terms of finding buyers for their SAFT (Simple Agreement for Future Tokens) agreements. These investors sometimes pay the OTCs upwards of 5–8% of the deal and also go through a cumbersome process of working with the project teams in terms of cancelling the old SAFT agreement and creating a new SAFT agreement for the buyer. With WVTs, an investor doesn’t have to work with the project for creating any new documentation. He/she can simply list the WVTs for sale on the Capx exchange and the payments and escrow will be taken care of by the Capx Exchange. In this integration with Acala, Capx Exchange will be using Acala’s decentralized stablecoin, aUSD, as the default currency for all buy/sell bids on the platform.

Capx Lend

Capx lend is a decentralised platform that allows borrowers to put Wrapped Vesting Tokens (WVTs) as collateral and borrow aUSD from lenders on the platform. It is a peer-to-peer based lending platform and the terms are individually agreed upon by the lender and the borrower for every engagement.

Any publicly traded asset is a great collateral for any lending/borrowing arrangement as there is a lot of information available on the liquidity of the asset and the risk associated with any price movements of the asset based on the trading history available in the markets. As WVTs are derivatives of publicly traded crypto assets, they act as a great form of collateral as there is a lot of information already available in the market to perform risk analysis on these WVTs.

The investors holding WVTs don’t need to sell WVTs to access liquidity, but can also borrow aUSD against these WVTs. That allows the investors to access liquidity and still sit on the upside the tokens have to offer. Even teams can utilise WVTs to access capital. When building a company with crypto assets associated with it, a lot of companies resort to selling treasury tokens to get access to capital for Operational expenses. However, companies then have to work extra hard to ensure there is increased liquidity in the market for the increased supply of the token. However, with WVTs companies can choose to borrow against the unvested tokens. This helps the company get access to capital without having to worry about increased token supply in the market.

Follow the Integration

The Acala and Capx teams will be keeping the community updated on the launch of Capx, including more education around Capx’s products, team, and roadmap. You can follow along on the Acala or Capx twitter accounts, or any of the social links below.

Build on Acala

If you’re a team looking to build on Acala or looking for support from Acala Grants, please get in touch with our team to chat about how we can support you.

About Capx

With the vision to democratize the financial markets, Capx aims to spearhead the DeFi revolution by building towards a more mature decentralized financial ecosystem.

Our product suite consists of:

Capx Liquid; a liquid vesting platform,
Capx Exchange; a P2P DEX &
Capx Lend; a borrowing and lending protocol for the Wrapped Vesting Tokens (WVTs)

The Capx Ecosystem encompasses an exhaustive suite of products, catering to all stakeholders from Project teams, to Investors to Retail Investors, enabling liquid vesting, tradable WVTs and borrowing/lending protocols for these WVTs (Wrapped Vesting Tokens).

About Acala

Acala is an Ethereum-compatible smart contract platform optimized for DeFi and scaling DApps to Polkadot. The blockchain has built-in DeFi protocols for application developers to leverage, including a decentralized stablecoin (Acala Dollar — aUSD), a trustless staking derivative (liquid DOT — LDOT), and a decentralized exchange.