Trader Joe is an automated market maker (AMM) based decentralized exchange (DEX) on the Avalanche blockchain. Despite only starting operation this year, the DEX has become the AMM with the largest total value locked (TVL) in the Avalanche ecosystem with $500 million.
Although it shares the same name as the US supermarket chain Trader Joe’s, the exchange has gained massively over the last four months. Trading volumes on Trader Joe exploded following the launch of Ethereum’s scaling solution Arbitrum, to which it has since expanded its services.
The native token of Trader Joe is JOE, which can be used to stake on the exchange. Furthermore, the DEX offers a slew of services including token swaps via the AMM, staking, yield farming, lending and borrowing, liquidity pools, leveraged trading, an NFT marketplace, and a token launchpad.
Despite its promises, traders and market experts are skeptical about the project, a case we will look into in this article.
How Does Trader Joe Work?
Trader Joe combines DEX with lending and leverage trading, which helps promote liquidity and attract more cash flow to the exchange.
It is also one of the very first projects to find a solution to the price slippage issue on DEXs by executing a limit order on trades. If successfully executed, the limit order will be revolutionary for the decentralized finance (DeFi) market and could propel Trader Joe to new heights.
What is the Purpose of the JOE Token?
The native token of Trader Joe has three main use cases. Firstly, it is used as the reward token on the DEX for staking in supported cryptocurrencies. Then as an incentive for yield farming. Lastly, as a governance token on the decentralized autonomous organization (DAO) of the exchange through JOEVOTE.
JOE can also be deposited into the DEX’s launchpad – Rocket Joe, which supports new tokens deployed on Avalanche (AVAX). Rocket Joe also has a native token called rJOE that users can accrue when they deposit JOE into the staking pools.
JOE Token Metric
|Trader Joe (JOE)
JOE Token Allocation
Who are the Investors of Trader Joe?
Earlier this year, Trader Joe (JOE) raised $5 million in a funding round led by DeFiance Capital, GBV Capital, and Mechanism Capital. The funding was backed by the Avalanche Foundation, Delphi Digital, Coin98 Ventures, Not3Lau Capital, and Aave (AAVE) founder Stani Kulechov.
Receiving the backing of credible venture capitalists in Web3 only adds to the reputation of the innovative new DeFi project.
Is Trader Joe a Scam?
In October, supermarket chain Trader Joe’s sued the DEX, alleging federal trademark infringement. The court filing for the case read that the defendants named the cryptocurrency platform “after the supermarket” and developed a narrative around a fictional figure called ‘Trader Joe’ who sells crops in local marketplaces.
The US retail giant accused Trader Joe (DEX) of further evoking the Trader Joe’s brand and its business.
The complaint alleges that Trader Joe DEX committed fraud to muddle its origin story to win legal proceedings over its domain name traderjoexyz.com. After the exchange failed to respond to private requests from the supermarket brand to stop misusing its trademark, Trader Joe’s filed a complaint with the World Intellectual Property Organization (WIPO) to strip the DEX of its domain name.
However, Trader Joe (JOE) defended its position by claiming the platform was named after its co-founder’s brother. The grocery chain is seeking damages from the exchange and has demanded a trial by jury.
Trader Joe (JOE) is currently one of the best AMM DEX projects on Avalanche its contributions are vital to decentralized exchanges. The platform’s lending and leverage mechanism and limit order facility will make it stand out against other DEX offerings.
With Ethereum still struggling to figure out its problems related to gas fees and transaction speed, Trader Joe presents Avalanche with a huge opportunity in the DeFi space that could result in other projects migrating to the blockchain.
Despite its legal troubles with the supermarket chain Trader Joe’s, JOE’s business model, investors, and users all point toward a project that has a major role to play in the future of DEX and DeFi.
Therefore, I can conclude this article by stating that Trader Joe (JOE) is not a scam. But I would like to let you know that this content should not be taken as investment advice and it is always recommended to do your research before making financial decisions.