What is Woo Network? (WOO)
Summary of WOO Network
- Incentives for staking WOO tokens include zero-fee trading, higher referral rebates, and WOO Ventures token airdrops
- Embedded within multiple DEXes on Ethereum, Polygon, Solana, and more, WOO tokens provide plenty of yield farming options
- Soon to come social trading and governance features attest to WOO Network’s intention to keep expanding the token’s utility
By utilizing blockchain technology, the network’s infrastructure provides traders, exchanges, institutions and DeFi platforms access to greater market liquidity and faster trading execution at zero or low cost.
These services include WOO Network’s centralized exchange (CEX) WOO X, DeFi related offerings under the umbrella brand WOOFi, and Wootrade, a liquidity pool for institutional clients.
WOO Network’s various services center around the utility token, WOO. By staking WOO tokens on WOO X, users can reduce or offset trading fees and API trading rate limits, as well as increase the impact of their referral rebates. In DeFi applications, WOO token can be used for providing liquidity through yield farming or as collateral for lending and borrowing other crypto assets.
WOO token’s future governance utilities are planned to grant its holders voting rights over the future development of the network, based on the amount and duration their tokens have been staked.
Who created WOO?
WOO Network’s founding team features Kronos Research co-founders Jack Tan and Mark Pimentel.
Kronos Research, founded in 2018, is a cryptocurrency quantitative trading firm that specializes in arbitrage and high-frequency trading (HFT).
Tan and Pimentel started WOO Network as Wootrade in 2019. The team has since built a diverse set of products and services, which intersect retail, institutions, CeFi, and DeFi offerings.
Through this close relationship, Kronos Research acts as a cornerstone liquidity provider on WOO X and relies on the platform's deep liquidity to offset their market making risks.
WOO Network has attracted a list of top-tier institutions while raising its $30 million Series A, with backing from Three Arrows Capital, PSP Soteria Ventures, Gate Ventures, QCP Capital, and Crypto.com Capital.
How Does Woo Network Work?
CeFi Products and Services
WOO X is the network’s CeFi flagship product. It launched in August 2021 as the first crypto exchange to use Payment for Order Flow (PFOF), a compensation model that rewards brokers for forwarding orders to different market participants for trade execution. Along with its higher level of transparency regarding trade execution, the PFOF model aims to deliver a more competitive fee structure for retail traders.
The WOO X exchange achieves its deep liquidity by aggregating market depth from larger exchanges and setting up an open liquidity pool with participation from multiple market makers, including Kronos Research.
Wootrade is the network’s dark pool trading platform for institutional clients to place trades without immediately revealing their strategy to the public. Wootrade also aims to provide above-average liquidity and tighter spreads for exchanges, wallets, OTC desks and large traders.
DeFi Products and Services
WOO Network also includes a decentralized exchange (DEX) called WOOFi Swap, which manages transactions through a synthetic Proactive Market Maker (sPMM) algorithm model. This allows WOOFi Swap to avoid intermediary control while operating in a similar way to the order book model common across most centralized exchanges. WOO Network states their model was designed to better simulate the price, spread, and depth of an order book on CEXes, while enabling lower swap fees for WOOFi Swap users.
The so-called WOOFi’s pools that serve as the assets from which WOOFi Swap traders transact are currently deployed on Binance Smart Chain (BSC) and Polygon, with reportedly more blockchains to follow.
Why does WOO have value?
WOO token launched on October 30, 2020, with a maximum supply set at three billion tokens.
Its deflationary model relies on the WOO Network's monthly buyback and burn program, which permanently removes WOO tokens from circulating supply. Each month, 50% of the WOO Network’s revenue is used for purchasing WOO tokens off the secondary market and burning them. This removes WOO tokens from the circulating supply, with the aim to control the inflation rate of the Woo token.
CeFi: Staking WOO Tokens
Institutional clients placing large volumes of trades on WOO X can increase API trading rate limits and reduce trading fees by staking their WOO tokens.
Retail clients can also access perks, such as zero-fee trading and higher referral rebates, by staking WOO tokens on the network’s centralized exchange, WOO X.
While all retail traders on WOO X benefit from 0% “maker fees” by default, staking WOO tokens enables users to also reduce “taker fees” from a maximum of 0.05% down to 0%. Both free withdrawals and referral rebates increase with the amount of WOO tokens staked.
WOO Networks states that WOO token stakers will also earn a portion of the tokens generated from WOO Ventures, the early-stage investment project identifying high value projects building for the WOO ecosystem.
DeFi: Yield Farming, Lending and Borrowing
While WOO token initially launched as a utility token on the Ethereum blockchain, cross-chain bridges have allowed it to exist on several other blockchains including Polygon, Solana and others.
Since WOO tokens are available across multiple DEXes on those chains, such as Bancor, Sushiswap, and Uniswap, traders can decide which service best fits their yield farming strategy, as they earn fees generated from other traders utilizing the assets that have been deposited in the liquidity pools.
DeFi users can also choose to use their WOO tokens as collateral for borrowing and lending on several protocols, such as KINE Finance and Unit Protocol.
WOO token is planned to become a governance token and earn its holders voting rights on various proposals, including governance structures, listings, revenue sharing mechanisms and staking mechanisms.
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Why buy WOO?
Traders may consider purchasing WOO if they would like to reduce their trading fees and unlock discounts on the WOO X exchange.
Those looking to earn additional crypto rewards through yield farming may choose to buy WOO token for providing liquidity to decentralized exchanges.
DeFi users may also find value in WOO since it can be used as collateral for lending and borrowing crypto assets.
WOO token may be a worthwhile option for those wishing to participate in WOO Network's governance in the future.