Lumen – Behind the Brand
A conversation with Lumen’s founder Serge on market making strategies, enhancing liquidity for small-cap tokens, and setting new standards for crypto market integrity.
Lumen – Behind the Brand
Our founder interview series offers an opportunity to gain insights directly from the innovators shaping the future of crypto and Web3. By speaking with founders firsthand, we hope to uncover valuable perspectives on the challenges, opportunities, and trends driving the industry forward.
Each conversation takes us behind the scenes of different brands Noir has helped to shape, exploring their distinctive approaches, strategies, and vision. We hope these conversations will not only inform and inspire but also provide practical lessons and deeper understanding for anyone working in crypto and Web3.
Q: “Hi Serge, let's start with an introduction about yourself and your journey into the market making space. What inspired you to create Lumen and focus on providing liquidity for small cap tokens?”
A: Hey NOIR team, thanks for giving us the opportunity to talk about Lumen !
What led us to create this Liquidity Provider is a simple observation: Crypto is overall extremely inefficient, and the small mcap tokens market has the greatest upside. In these conditions even the smallest venue can have a piece of the cake against institutions.
With our experience ranging from traditional finance, passing through cybersecurity companies and main crypto launchpads, we united our forces to seize this opportunity, and make the small mcap tokens more liquid for everyone, while relying on a battle-tested business model.
Q: “Lumen offers market making services across both centralized and decentralized exchanges. Can you explain the differences in your approach to liquidity management on CEX versus DEX platforms and the challenges unique to each”
A: DEXes have the peculiarity to follow a curve price set by the initial amount of tokens you’ve deposited. While the majority of our volume is performed on Centralized Exchanges, due to a larger number of participants, DEXes offers the ability for us to get better pricing and arbitrage at momentums. This combination of DEX & CEX offers larger opportunities and allows us to increase volume, hedge the risk on CEX and also observe market participants onchain, it’s like the market whispering to your ears !
Q: “Lumen employs advanced trading strategies to manage volatility and enhance liquidity. Could you outline some of the key strategies you employ to ensure tight spreads and high market depth for small cap tokens?”
A: There’s many! We usually combine multiple and precise strategies of grid trading, which consists of setting multiple buys and sell orders around a defined price. So the whole challenge for us is to always be in a position where a majority of our buy prices are lower than our selling prices. In this condition the higher the volume, the higher the profit, and anyone can take one of our orders around the price agreed by the market. Our real job is to measure current and implied volatility to make sure our strategies are always in a profitable position, while giving the best orders for any market participants.
Q: “The AI and machine learning narratives are becoming intertwined with crypto, do you see a future where Lumen will use AI models to improve market efficiency?”
A: This is possible. So far the codes provided by LLMs are fairly basic and hardly reliable. When you want to have the most advanced strategies. However, it gives a proper foundation to start from scratch. Let’s see how the quality of the output can be improved : perhaps we’d have a code that is automated and flexible depending on market conditions, but as far as we can see, we’re far from this.
Q: “Market manipulation is a significant concern in the crypto space. What measures does Lumen have in place to protect against risks such as hacking, spoofing, and wash trading?”
A: It is indeed common, which pushes the regulators to look further into our industry. Our thesis is that the crypto market is exhausted from this, and might just disappear if we do not set our standards higher, much higher. Previous actors engaged in such malicious behaviors are now sanctioned, either by Financial Authorities or simply by the market. Our mission is to be the go-to Liquidity Provider when it comes to managing small mcap tokens, to prove that we're in the process to get a VASP license. You could argue that a License is just requirements that must be ticked, and you’d be right, which is why it’s all about your perspective, and what kind of games actors are playing. I can tell you that Lumen is for sure playing the long-term game.
Q: “Lumen prides itself on providing a personalized and streamlined client onboarding experience. Can you explain how your approach is different to your competitors and the services you employ meet your clients specific needs?”
A: There’s no magic trick, we do care about the people that engage with us. We do care about the experience when it comes to KYB, that can be a real pain due to stringent requirements. We do care about the transparency and the data provided to our clients. In a certain way, we have to lower the barriers of onboarding, making sure the path of least resistance is employed for the client, at almost any cost.
Q: “Looking ahead, what is your long-term vision for Lumen? How do you see your platform evolving over the next few years, and what impact do you hope it will have on the market making landscape for small cap tokens?”
A: We’ll truly strive to be the best Liquidity Provider in this niche. We’re working toward a more automated experience where the client can set his bots on his own, with minimal interaction with the team, and have a dashboard where he can manage his positions. We do believe that you’re not better served than by yourself. We also plan to have a wider offer for Prop services with advanced algorithms, and be able to provide serious APY whatever the market conditions.
Q: “And more broadly, where do you see the crypto market heading over the next year, and what major trends or developments do you think will shape its future?”
A: The current crypto industry is stuck in an awkward path, where we keep recreating the same protocols over and over again, with networks not bringing any value accrual. The worst is that we misallocate our trust towards the wrong actors, with technologies supposed to be trustless. To us, this question relies on the overall behaviors of all the market participants and protocol’s security, so there’s a self-examination to be performed to know where we want to be headed. Was crypto just a dream escaping briefly to any government authorities scrutiny, or is it a sustainable financial system, built for the centuries to come for any market participants ? We have the highest conviction on the latter.
Thanks Serge!
Our founder interview series offers an opportunity to gain insights directly from the innovators shaping the future of crypto and Web3. By speaking with founders firsthand, we hope to uncover valuable perspectives on the challenges, opportunities, and trends driving the industry forward.
Each conversation takes us behind the scenes of different brands Noir has helped to shape, exploring their distinctive approaches, strategies, and vision. We hope these conversations will not only inform and inspire but also provide practical lessons and deeper understanding for anyone working in crypto and Web3.
Q: “Hi Serge, let's start with an introduction about yourself and your journey into the market making space. What inspired you to create Lumen and focus on providing liquidity for small cap tokens?”
A: Hey NOIR team, thanks for giving us the opportunity to talk about Lumen !
What led us to create this Liquidity Provider is a simple observation: Crypto is overall extremely inefficient, and the small mcap tokens market has the greatest upside. In these conditions even the smallest venue can have a piece of the cake against institutions.
With our experience ranging from traditional finance, passing through cybersecurity companies and main crypto launchpads, we united our forces to seize this opportunity, and make the small mcap tokens more liquid for everyone, while relying on a battle-tested business model.
Q: “Lumen offers market making services across both centralized and decentralized exchanges. Can you explain the differences in your approach to liquidity management on CEX versus DEX platforms and the challenges unique to each”
A: DEXes have the peculiarity to follow a curve price set by the initial amount of tokens you’ve deposited. While the majority of our volume is performed on Centralized Exchanges, due to a larger number of participants, DEXes offers the ability for us to get better pricing and arbitrage at momentums. This combination of DEX & CEX offers larger opportunities and allows us to increase volume, hedge the risk on CEX and also observe market participants onchain, it’s like the market whispering to your ears !
Q: “Lumen employs advanced trading strategies to manage volatility and enhance liquidity. Could you outline some of the key strategies you employ to ensure tight spreads and high market depth for small cap tokens?”
A: There’s many! We usually combine multiple and precise strategies of grid trading, which consists of setting multiple buys and sell orders around a defined price. So the whole challenge for us is to always be in a position where a majority of our buy prices are lower than our selling prices. In this condition the higher the volume, the higher the profit, and anyone can take one of our orders around the price agreed by the market. Our real job is to measure current and implied volatility to make sure our strategies are always in a profitable position, while giving the best orders for any market participants.
Q: “The AI and machine learning narratives are becoming intertwined with crypto, do you see a future where Lumen will use AI models to improve market efficiency?”
A: This is possible. So far the codes provided by LLMs are fairly basic and hardly reliable. When you want to have the most advanced strategies. However, it gives a proper foundation to start from scratch. Let’s see how the quality of the output can be improved : perhaps we’d have a code that is automated and flexible depending on market conditions, but as far as we can see, we’re far from this.
Q: “Market manipulation is a significant concern in the crypto space. What measures does Lumen have in place to protect against risks such as hacking, spoofing, and wash trading?”
A: It is indeed common, which pushes the regulators to look further into our industry. Our thesis is that the crypto market is exhausted from this, and might just disappear if we do not set our standards higher, much higher. Previous actors engaged in such malicious behaviors are now sanctioned, either by Financial Authorities or simply by the market. Our mission is to be the go-to Liquidity Provider when it comes to managing small mcap tokens, to prove that we're in the process to get a VASP license. You could argue that a License is just requirements that must be ticked, and you’d be right, which is why it’s all about your perspective, and what kind of games actors are playing. I can tell you that Lumen is for sure playing the long-term game.
Q: “Lumen prides itself on providing a personalized and streamlined client onboarding experience. Can you explain how your approach is different to your competitors and the services you employ meet your clients specific needs?”
A: There’s no magic trick, we do care about the people that engage with us. We do care about the experience when it comes to KYB, that can be a real pain due to stringent requirements. We do care about the transparency and the data provided to our clients. In a certain way, we have to lower the barriers of onboarding, making sure the path of least resistance is employed for the client, at almost any cost.
Q: “Looking ahead, what is your long-term vision for Lumen? How do you see your platform evolving over the next few years, and what impact do you hope it will have on the market making landscape for small cap tokens?”
A: We’ll truly strive to be the best Liquidity Provider in this niche. We’re working toward a more automated experience where the client can set his bots on his own, with minimal interaction with the team, and have a dashboard where he can manage his positions. We do believe that you’re not better served than by yourself. We also plan to have a wider offer for Prop services with advanced algorithms, and be able to provide serious APY whatever the market conditions.
Q: “And more broadly, where do you see the crypto market heading over the next year, and what major trends or developments do you think will shape its future?”
A: The current crypto industry is stuck in an awkward path, where we keep recreating the same protocols over and over again, with networks not bringing any value accrual. The worst is that we misallocate our trust towards the wrong actors, with technologies supposed to be trustless. To us, this question relies on the overall behaviors of all the market participants and protocol’s security, so there’s a self-examination to be performed to know where we want to be headed. Was crypto just a dream escaping briefly to any government authorities scrutiny, or is it a sustainable financial system, built for the centuries to come for any market participants ? We have the highest conviction on the latter.
Thanks Serge!
