Aero aims to become the leading onchain spot exchange for tokenized stocks and other financial assets, according to Alex Cutler, cofounder and CEO of Dromos Labs.
The comments come as Aero launched across seven blockchain networks on Wednesday, consolidating Aerodrome and Velodrome into a single decentralized exchange.
“Prices are anchored in spot markets, traders hedge against them, and they absorb liquidations,” Cutler told Crypto Briefing. Without sufficient liquidity, he said, other onchain markets cannot function effectively.
Cutler pointed to Hyperliquid as an example of how derivatives trading can consolidate around a single venue with deep liquidity.
“Nobody has done that for spot yet, and that’s what Aero is building toward,” he said.
The comments expand on an interview with The Rollup published earlier this week, in which Cutler argued that crypto markets need an equivalent of the New York Stock Exchange or Nasdaq alongside derivatives venues comparable to the Chicago Mercantile Exchange.
Unlike traditional stock exchanges, which operate during fixed trading hours, tokenized stocks can trade around the clock, increasing the importance of liquid spot markets capable of supporting price discovery when underlying exchanges are closed.
Aerodrome claims majority of tokenized stock trading
Cutler said Aerodrome, Aero’s predecessor operating on Base, captured 55% of tokenized stock trading volume across Ethereum and its layer 2 networks, citing Blockworks data.
The figure represents a substantial increase from approximately 2% in early September.
Cutler attributed the growth to an incentive model designed to attract liquidity providers and trading activity to newly launched assets.
Under the model, issuers provide incentives to attract allocations from tokenholders, encouraging liquidity providers to support their markets.
Deeper liquidity can attract additional trading, generating fees distributed to staked AERO holders, who can then direct further incentives toward active markets.
“Tokenized stocks have roughly quadrupled this year, and it’s still early,” Cutler said, adding that new issuers need liquidity available from their first day of trading.
He also said Aerodrome had established a leading position in Bitcoin dollar trading pairs and onchain foreign exchange markets.
The company claims spot exchanges generated more onchain value over the past 12 months than derivatives, liquid staking, lending protocols or blockchains.
Aero expands to seven networks to compete for liquidity
The comments come as Aero expanded to seven networks following its launch Wednesday, October 21. The exchange now operates on Ethereum, Base, OP Mainnet, Arbitrum, Arc, Ink and Robinhood Chain, consolidating Aerodrome and Velodrome under a single AERO token.
The seven networks collectively handled approximately $120 billion in monthly decentralized exchange trading volume, according to the company’s launch materials.
Aerodrome accounted for 58% of decentralized exchange volume on Base during the third quarter, while Velodrome represented 60% of trading on OP Mainnet, the company said.
The new platform introduces a unified liquidity incentive system that allows staked AERO holders to allocate rewards toward markets they expect to generate trading fees.
All exchange revenue at launch will be distributed to staked AERO holders, with the project launching without venture funding or a token sale.
Cutler said the model is intended to attract liquidity providers from competing exchanges by offering incentives beyond ordinary trading fees.
During The Rollup interview, he argued that competitors reducing liquidity provider earnings could make it easier for Aero to attract capital.
The remarks come as decentralized exchanges increasingly explore mechanisms to direct portions of trading fees toward tokenholders, including Uniswap’s fee switch.
According to Aero, Aerodrome and Velodrome have distributed a combined $578 million in revenue and incentives to tokenholders, including trading fees and liquidity rewards.
Cutler said the company aims to at least double its share of onchain spot trading volume by the end of the year.
“Exchanges are winner-take-most markets and we intend to take the most,” he said.
Disclosure: This article was edited by Estefano Gomez. For more information on how we create and review content, see our Editorial Policy.