Linea welcomes the new DEX star Etherex: How to build the ETH capital base and solve the liquidity problem?

The new decentralized exchange Etherex on the Ethereum Layer 2 network Linea aims to fulfill the original promise of ETH DEX. The newly launched crypto assets exchange Etherex is designed to be the home for all Ethereum capital on Linea, committing to comprehensive incentives for users and building upon the promises of the Ethereum decentralized network. The name Etherex comes from the 2014 concept of the Ethereum decentralized exchange (DEX) "EtherEX". Etherex had a soft launch on Monday, and its network and partner Linea released an announcement on Tuesday detailing the token plans for Ethereum Layer 2 and its consistency with the Ethereum mainnet.

The Core Philosophy of Etherex: Fulfillment of the Initial Commitment of ETH DEX

North, the co-founder of Etherex, told Decrypt: "The concept of Etherex was born in 2014 – when decentralized exchanges were still just a dream. Since then, we have seen pioneers like Uniswap, Curve, and Aerodrome shaping the landscape of DeFi."

But Etherex is built around the original, uncompromising vision of Ethereum: a decentralized infrastructure that fully meets user needs and offers greater personal flexibility. North emphasizes that only now, with tools like Linea and zkEVM, can this vision be realized uncompromisingly.

According to Etherex co-founder, this consistency has been integrated into the platform's core structure, operating slightly differently from other DEXs, instead functioning as a "metaDEX." Declan Fox, the head of Linea, told Decrypt before Etherex's launch: "metaDEX addresses the three dilemmas of DEX," describing the misalignment issues between liquidity providers, traders, and token holders compared to some other decentralized exchanges.

For example, when you observe the Uniswap model, you will find that it does not provide any significant value to token holders. Therefore, metaDEX essentially addresses the dilemma of DEX by paying trading fees to liquidity providers (LP) as well as token holders. For Etherex, 100% of the fees and rewards belong to the token holders, while contributors only receive locked tokens. North stated: "No internal unlocking, no early exit, and no value extraction."

How Etherex Assists Linea in Enhancing Ethereum Capital

Coordination between users, protocols, and networks is crucial for the future success of Etherex, which is also how the platform attracts capital during promising funding inflows into Linea.

Fox stated that Linea will provide native yields from bridging capital while benefiting ETH and LINEA through deflationary burn to attract funds into the network, which aims to become the "chain of ETH capital." North mentioned: "The upcoming LINEA token issuance event is one of the most anticipated events in the crypto assets space. As people rediscover the reasons that initially attracted them to join Linea, it will bring significant liquidity and attention to Linea."

If such a surge occurs, North indicates that Etherex's role will be to become the "railway" of this capital, providing "sticky, sustainable, and net positive" returns, as well as "infrastructure for users to exchange and earn money - not just speculation and exit."

North stated that these benefits could ultimately make Etherex a source of capital for institutions like SharpLink Gaming. SharpLink Gaming is a leading Ethereum financial company and a member of the Linea Consortium, responsible for managing the issuance of LINEA tokens. These institutions can leverage Etherex's liquidity pools and lending markets "to create substantial returns for their stakeholders." They said, "With the influx of ETH, Etherex will be in a central position—helping to convert liquidity into long-term economic value."

Conclusion:

The launch of Etherex aims to address the "three dilemmas" of decentralized exchanges through its innovative metaDEX model and attract more Ethereum capital to the Linea network. This initiative is expected to enhance Linea's liquidity and user engagement, providing a new paradigm for the development of the Ethereum ecosystem.