Crypto Exchanges

Marketing & Positioning

When we think about growth and marketing at crypto exchange platforms, how should marketers orient themselves?

The first (and in my mind, most important) segmentation is whether the exchange is centralized or decentralized.

This initial framing determines the positioning of the solutions in the broader market, including who to target, the channels of engagement, the campaign distribution strategies, the content, and the value propositions.

This is the case because the organizational principle of platforms in the blockchain world inherently contains different use cases, risks, and preferences meaningful to end consumers.

World View Determines Platform Preferences

For example, someone very committed to maintaining anonymity will not use a crypto exchange that is not peer-to-peer. Similarly, someone who wants the convenience and ease of converting fiat money into crypto will not be interested in a decentralized exchange.

These two different world views attempt to accomplish the same goal: trade crypto, but they have opposing preferences.

In the blockchain world, world views are concrete preferences that are, in effect, platform determinate.

DEX v. CEX

Crypto exchanges are simply marketplaces that enable consumers and institutions to buy, sell and trade cryptocurrencies and tokens.

A decentralized crypto exchange or DEX, like other blockchain DeFi innovations, are marketplaces that enable direct peer-to-peer trading of cryptocurrencies. They use smart contracts to execute and manage trades instead of using a clearinghouse.

Many of the most critical and bleeding-edge use cases for DeFi are only possible in DEX platforms, including liquidity pools and staking.

Popular Crypto DEX platforms include:

• SushiSwap
• Uniswap
• Curve
• Balancer
• 1inch

On the other hand, centralized crypto exchanges are managed and controlled by a single organization. They often require extensive identifying information and follow the Know Your Customer regulations that banks follow.

Popular centralized exchange platforms or CEX include

• Kraken
• Coinbase
• Binance
• Gemini
• FTX

Centralized exchanges offer less speculative trading activities and target institutional investors and more sophisticated traders.

Value Proposition Dimensions & Differentiation

There are four critical areas for differentiating exchanges and generating engagement. In either a CEX or DEX, consumers care about fees, coin availability, security, and trading volume.

How secure is the platform, how popular is it, how secure is it, and what can I do on it are among the leading questions in target consumers’ minds.

We can see the difference in CEX and DEX marketing by looking at a leading exchange from both paradigms; Kraken as a CEX and SushiSwap as a DEX.

SushiSwap (DEX) v. Kraken (CEX)

Community marketing is the art and science of building awareness by directly enabling and engaging with prospects, consumers, and influencers/experts in the crypto world.

While SushiSwap has a robust presence on Twitter and Discord, Kraken has a presence on the traditional Web2 channels such as LinkedIn and Medium.com.

This distinction between Web2 and Web3 channels of engagement is a standard indicator of where a company lies on the centralized and decentralized continuum for blockchain companies.

We can also see differences in the kinds of products/features that each platform enables. Kraken, the centralized exchange, has more of the typical financial marketplace capabilities, including margin trading and futures/options.

SushiSwap, on the other hand, enables staking in liquidity pools and yield farming. Additionally, while Kraken’s non-B2C focus is on institutional and traditional investors, SushiSwap is focused on the B2D developer marketing and accordingly has extensive documentation and education materials to grow that community.

SushiSwap enables building, and creators are part of the community marketing and targeting. As a centralized exchange, Kraken is not a platform to create but rather to participate in crypto transactions and DeFi.

This is what I mean by worldviews are platform determinate. The configuration of a crypto platform based on a worldview determines the parameters of available services that necessarily refine who should be targeted and by which channels.