DEX vs CEX: best for token launches?

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LayerOneX
@LayerOneXSep 24, 2025

The Spaces explored whether DEXes or CEXes are better for token launches, hosted by Cody with panelists Kevin (Layer 1X/Quantum DEX), Aweibo, Mister Console, Biscuit, Pyji Dao, and Olympus X. Consensus leaned strongly toward a DEX-first, CEX-later sequence. Kevin framed launch choice around liquidity, accessibility, and dependability, noting DEX tech and uptime gains and rising DEX market share. He detailed Quantum DEX’s model: create and list in ~10 minutes, borrow up to $2M liquidity against the token as collateral, cross-chain access in/out, and an AI risk meter that publicly signals loan status to align incentives. Panelists criticized CEXes’ high fees, custody risks, and market-maker dumping; “not your keys, not your coins” resonated. Community building was deemed stronger on DEX, while CEX exposure often attracts “paper hands.” Interoperability emerged as pivotal, with L1X’s rollout and a forecasted CEX–DEX convergence toward unified liquidity and “DCX” connectors. On regulation, Pyji proposed hybrid subnets enforcing KYC/AML at issuance/redemption while enabling secondary DEX trading; Kevin added tax considerations and likely identity layers, while preserving permissionless paths. Olympus X outlined a DEX-only launch with incentive-aligned taxes that deter market selling and collect ETH at the contract level. The session closed with calls for due diligence and community-first strategies.

X Talk: DEX vs CEX — What’s Best for Token Launches

Participants and Roles

  • Cody (Host, X Talk)
  • Kevin (Co-founder, Layer1X and Quantum Dex)
  • A Weibo (Project lead, meme-to-utility platform with launch app)
  • Mr Console (Community host focused on gaming; contrarian by nature but pro-DEX here)
  • Biscuit (Builder/community lead; project that launched on Quantum Dex)
  • Pyji DAO (RWA-focused project in L1X ecosystem; token “Jitao”)
  • Olympus X (Upcoming Ethereum protocol; presented a DEX-only launch model)

Core Question

Which is better for token launches: decentralized exchanges (DEX) or centralized exchanges (CEX)?

Summary of Positions and Rationale

A Weibo

  • Firmly pro-DEX for launches; has advised on 100+ DEX launches.
  • Key arguments:
    • “Not your keys, not your coins” — CEX custody risks are unacceptable.
    • DEX launches filter for users who research and contribute, rather than opportunistic CEX participants.
    • DEX offers the project more control over parameters and participant behavior during launch.
    • CEXs try to control too many aspects of the project post-listing; the project should retain control.
    • Recommendation: build reputation and community first on DEX; only consider CEX later if at all.

Kevin (Layer1X / Quantum Dex)

  • Not an either/or — sequence and priorities matter: DEX first, CEX later is the 2025 trend.
  • Decision drivers for launch venue:
    • Liquidity: historically stronger on CEX, but evolving; DEX liquidity solutions are improving.
    • Accessibility: DEX is increasingly accessible technologically (wallet abstraction, fiat on/off-ramps) and regionally (VPN, 24/7 availability).
    • Dependability: DEX uptime and resilience generally better due to decentralization.
  • Market data and trend:
    • DEX market share by volume rose from ~9% (early 2024) to ~25% (2025), indicating strong momentum.
  • Analogy: “Uber effect” — users increasingly go directly to known DEX venues to buy the token they already want, rather than searching broadly.
  • Convergence thesis:
    • CX-DX convergence (e.g., Binance routing trades through PancakeSwap) foreshadows blended models.
    • Predicts evolution from CX↔DX bridging (CXDx) toward “DCX” connectors where DEX integrates liquidity into CEX order books; expects DEXs to innovate first due to fewer institutional burdens.
  • Bottom line: Projects need both community and (eventually) institutional/integrator interest; DEX-first provides accessibility and autonomy; later CEX listings can add validation and reach.

Mr Console

  • Wants to be contrarian but ultimately endorses DEX for launches.
  • View: Good CEXs are prohibitively expensive for startups; you end up buying into a community that hasn’t built trust with your product (paper hands). DEX requires your own community — that’s healthier long-term.

Biscuit

  • Strongly pro-DEX for authentic community formation.
  • CEX participant base tends to be airdrop-chasers and exit liquidity; engagement level near zero.
  • DEX attracts early risk-takers who build relationships and grassroots support; this drives sustained growth.
  • Strategy: Build on DEX and let CEX interest become organic via FOMO; paying market makers on smaller CEXs often drains project liquidity.

Cody (Host)

  • Personal experience: CEXs “nickel and dime” fees (listing, marketing, liquidity) and have dumped tokens post-listing, damaging launches.
  • Reiterates “not your keys, not your coins.”
  • Industry lens: Web3 needs consolidation — liquidity isn’t sufficient for every game, chain, and project. Interoperability that routes and aggregates liquidity across venues/chains is essential; this is why he joined L1X.

Pyji DAO

  • DEX is the future for trust and unstoppable execution (24/7, automated like a stock market but non-intervenable).
  • Interoperability is the key milestone (L1X rollout praised; aligns with Raoul Pal’s thesis that cross-chain native design will endure).
  • Regulation approach (hybrid model proposal):
    • Use L1X subnets to enforce compliance (KYC/AML) at initial sale and redemption (i.e., the on-chain stock issuance and conversion points).
    • Allow anonymized secondary trading on DEX for the tokenized asset between those regulated endpoints.

Olympus X

  • Committed to a DEX-only launch to align with decentralization ethos and reduce custody/security risks.
  • Problem statement: Most launches devolve into unsustainable hype followed by prolonged red candles due to constant market selling.
  • Design response (high-level features):
    • Single liquidity pool on Uniswap and unique vaults — unified price discovery and constrained fragmentation.
    • Incentive-aligned tax schema to discourage harmful behaviors:
      • 0% tax on buys (encourage entry).
      • 0% on wallet-to-wallet transfers (neutral action).
      • 38% on market sells (deterrent against reflexive dumping).
      • 8% on limit orders (less harmful to price; acts as sell wall).
      • 0% on exit via LP (educate users to use LP exits over market sells).
    • Contract-level tax capture using Uniswap hooks (collect ETH before settlement), avoiding the need to sell the project’s token to build treasury.
    • Taxes fund staking and other mechanisms (presentation cut short; invited to a dedicated pitch session).

Liquidity and Quantum Dex: Mechanisms to Improve DEX Launch Outcomes

Quantum Dex (by Layer1X)

  • Purpose: Solve liquidity accessibility for small/early projects without forcing them into costly CEX listings.
  • Key features:
    • Up to $2 million in liquidity available via a self-service dashboard in under ~10 minutes.
    • Liquidity is borrowed with the project’s own token as collateral, preserving capital for tech/marketing.
    • Cross-chain trading: users can buy from any network (e.g., ETH to the new token) and withdraw to any network, abstracted under the same flow.
    • AI-driven “risk meter” transparently signals loan repayment status to users, acting as a compliance-like wrapper and community safeguard against rugs.
    • Results: 50+ tokens listed; millions of transactions in ~100 days; strong performance examples include Biscuit and X Talk-associated launches; Biscuit repaid its loan within weeks.
  • Kevin’s data point: Launching with < $25k liquidity yields ~15–20% survival chance over 6 months; $100k+ materially improves survivability.
  • Cost comparison: CEX listing often requires $60–80k (Cody noted figures ranging $20k to $500k including marketing), but may still not deliver sustainable success.

Community Dynamics: Why DEX First

  • DEX communities form around builders and early adopters (risk-takers who contribute, promote, and develop), fostering long-term engagement and network effects.
  • CEX listings may bring volume/visibility but often draw transient participants (“paper hands”), and without an existing community, project momentum frequently stalls.
  • Many tier-1 CEXs require strong pre-existing community strength — further reinforcing DEX-first as the practical path.
  • Takeaway: Community is the non-negotiable foundation; DEX best supports grassroots growth and ownership culture.

Interoperability and Consolidation

  • The industry will likely consolidate liquidity across venues and chains to overcome fragmentation.
  • L1X’s interoperability aims to:
    • Unite liquidity across chains and venues via routing.
    • Enable “any-chain to any-token” transactions with speed, security, and decentralization.
    • Reduce friction for users and builders, making chain choice less critical.
  • Market signal: CEXs (e.g., Binance) already route through DEX liquidity (PancakeSwap), indicating convergence.

Regulation, Compliance, and Tax

  • Expect evolving hybrid models:
    • Compliance enforced at issuance/redemption via subnets (KYC/AML), while secondary DEX trading remains permissionless.
    • Possible front-end KYC/AML overlays even for DEX UIs; smart contract-level permissionlessness remains but UX layers could be regulated.
  • Tax considerations (not advice):
    • Swaps into stablecoins are taxable events in many jurisdictions; DEX activity may be less visible but regulators are likely to scrutinize CX↔DX routing over time.
  • Outlook:
    • Increasing blending of CEX launchpads with DEX liquidity and compliance.
    • Identity standards (e.g., NFT-based IDs) may emerge for mainstream compatibility.
    • Governments remain in learning mode; trajectory suggests regulated endpoints with permissionless secondary trading.

Practical Guidance and Takeaways

  • DEX-first, CEX-later is the prevailing strategy in 2025 for most tokens.
  • Secure adequate liquidity for launch (≥$100k preferable) to improve survivability; explore DEX-native liquidity solutions (e.g., Quantum Dex loans).
  • Build community early and continuously; avoid relying on CEX exposure without deep community trust.
  • Embrace interoperability to broaden user access and unify liquidity.
  • Consider compliance architecture if tokenized RWAs or mainstream distribution is a goal; subnet-level enforcement at issuance/redemption.
  • Incentive design matters: discourage behaviors that create reflexive selling (e.g., Olympus X’s tax model) and educate users on constructive mechanics (LP exits, limit orders).

Notable Highlights

  • DEX volume share reportedly rose to ~25% in 2025 (from ~9% in early 2024).
  • Binance’s routing through PancakeSwap highlights CX-DX convergence.
  • Layer1X interoperability milestone went live (timing: “today/yesterday” relative to the session), underscoring cross-chain UX priority.
  • Quantum Dex: self-service, cross-chain, AI risk, and liquidity loans up to $2M — significant tooling for early projects.

Open Questions

  • Which side (CEX or DEX) will first successfully unify order books/liquidity at scale?
  • How will regulators implement KYC/AML across dominant DEX front-ends without undermining permissionlessness?
  • Will identity standards (NFT IDs or similar) gain user acceptance and regulatory approval for mainstream adoption?

Follow-ups and Resources

  • Olympus X and A Weibo invited to X Talk’s 10-minute pitch show next Wednesday at 8 a.m. EST.
  • Kevin pointed listeners to LVXapp.com for Quantum Dex/L1X solutions.
  • X Talk recurring schedule: Tuesdays at 10 a.m. EST; Pitch shows on Wednesdays at 8 a.m. EST.