Is Extended the next billion dollar exchange? Probably.
Europe, distribution and revenue per dollar — why a mid-sized perp DEX with eToro and Circle behind it may be priced for its launch floor, not its earnings.
TLDR
- Europe is the prize. Extended aim to become the everything exchange for Europe. 10m+ EU retail investors trade derivatives, 25m Europeans hold crypto, & only a handful hold the MiFID licences to offer perps. Nobody else has global perps, EU licences, & a path to stocks.
- eToro brings the users. 3m+ funded accounts within EU & UK. Extended will provide 24/7 perps for all assets within the eToro app. eToro are an equity investor & revenue share partner, so are aligned to route flow.
- Circle is the rails. Extended have a ‘strategic partnership’ with Circle & will be migrating to Arc. If Extended are the flagship trading platform on Arc, this gives reason for Circle to push flow to Extended.
- Warchest. Extended already have amassed ~$20m in treasury & 90% of future revenue will buyback the token. Validators will have to buy from the open market + potential revenue from stablecoin agreement with Circle.
- Extended are already in talks with major EU fintechs, CFD brokers, & even more to provide regulated perps. Every 10% of flow routed is ~$2b a month & ~$5m a year of revenue.
- Valuation: launch floor $150–200m FDV; 18x forward on projected revenue → bear ~$380m, base ~$860m, bull ~$1.6b. Polymarket implies ~$200–250m — pricing the floor, not the earnings.
1. Extended Overview
Extended Exchange is a hybrid perpetual futures DEX on Starknet. It blends an off-chain orderbook with on-chain settlement, aiming for CEX-like execution with self-custody.
Key numbers: 300+ perp markets (crypto, equities, commodities, FX, indices), Unified margin (all collateral shared across positions), Leverage up to 50x, Builder codes (APIs for brokers & fintechs to plug in perps), Predictions, vaults, spot & lending via partners, ~45k traders, 69.2m points, $120m TVL (DefiLlama).
The team: Ruslan Likhuta (ex-Revolut Head of Crypto), Luis Aarup (ex-Revolut Head of Engineering & ex-Coinbase), Kirill Nikolskii (ex-CTO B2C2), Dimo Totev (ex-Revolut Head of Product), Javier Ramis (ex-Revolut Head of Growth & ex-Binance), Jennifer Zhang (ex-Binance Global Head of PR) & Yegor Gavrilov (ex-Revolut Engineer).
Funding: 2024: $6.5m was raised led by Tioga Capital with Cyber Fund (Konstantin Lomashuk, Lido founder) & current Revolut C-suite involved. 2026: $12.5m was raised in 2026 led by eToro with Jump & Alber Blanc (their first crypto investment).
Extended has reportedly rejected much larger VC offers to maintain alignment with community & control over equity.
Points have been running since April 2025 & should end in October 2026 with total points capped at 70m. At the time of writing, we are sitting at 69.2m points with final distribution expected October 13th.
It is a mid-sized venue in a competitive market, but it has built out many features so better to compare against competitors than me telling you.
2. Traction & Competition
Extended has done $270b+ of cumulative volume & $34m in fees in ~18 months, with 45k+ traders, & all without paid marketing. Today it does ~$7.5b of perp volume & ~$1.6m of fees a month.
Extended vs CEXs — it doesn't win on features. It wins on two rows no CEX can tick:
- Self-custody & verifiable on-chain: users hold their own funds, & every trade can be checked on-chain, while CEX volume is self-reported.
- RWA perps & builder codes: Extended can plug its infrastructure into brokers like Trading 212 & IG, so they can offer perps without building them. CEXs have no distribution edge like this.
Venue summaries
- Hyperliquid = the king, but CEX-like opacity. No KYC, no licences, no audits, though HIP-3 markets are expanding it into RWAs. ~80% of on-chain perps volume.
- Variational = tiny team shipping fast & quietly building revenue ($7.2m 30-day net spread revenue). RFQ model for big trades, not an orderbook. Worth watching.
- Lighter = best-in-class tech & transparency (zk proofs), but no licences & no revenue share. Metrics inflated by farming; post-TGE volume down ~87%. eToro stake & Robinhood flow are interesting, but it's a volume machine not a value machine.
- Extended = great for trading + suite of products, best for capital efficiency imo i.e. XVS yield whilst long / short, but metrics inflated due to farmers.
- Backpack = regulated EU perps venue (Backpack EU), but tiny volumes & no token value accrual.
- Aster & edgeX = Crime.
Summary: Feature wars miss the point. The next leg of growth isn't better perps — it's regulated distribution: EU licences, broker integrations & RWA collateral. Extended is the only venue positioned for all three.
What makes Extended so good imo: low execution costs & capital efficiency — the bit I keep coming back to. DeFiLlama's REAL ranking (Oct 2026, measured from real BTC/ETH/SOL fills) puts Extended top on execution at 83/100 — ahead of every venue scored, CEXs included. A $10k BTC/ETH order costs $2.78 all-in ($2.50 taker fee + $0.28 half-spread), about half what Hyperliquid ($5.26) or Binance ($5.37) charge at base tiers. A minute after your fill, the price has typically moved $0.94 per $10k in your favour — 1st among DEXs. And fills beat the book: on $100k orders, paid slippage was $3.55 vs $5.11 shown.
Then the capital side: unified margin means one collateral pool backs every position, & the XVS vault pays yield on that collateral while it's posted — long or short. So you're paying ~half the execution cost of the big venues, on capital that's earning while it works. Cheap fills + productive collateral — nobody else offers both. (Honesty note: the thread's from someone on the Extended team, but the numbers are DeFiLlama's, not theirs.)
3. Europe: Everything Exchange
On-chain perps trade ~$0.6t a month across 300K users. EU CFD brokers trade ~$1.3tn a month across millions of users. The gap between those two numbers is the opportunity: regulated perps that feel like CFDs but settle on-chain.
Extended's plan: become the ‘everything exchange’ for Europe — perps on crypto, stocks, FX & commodities, then spot, predictions & more, all under EU licences.
The two licences that matter: MiCA covers crypto custody, exchange & transfers — the baseline for operating in the EU. MiFID II covers derivatives — the licence that lets you offer perps to EU retail. Almost no crypto venue holds both.
Extended's position: EU entity in place, MiCA application in progress, MiFID II route via acquisition or partnership. Backpack EU (ex-FTX EU) is the only live example of MiFID perps in the EU today — 40+ pairs, up to 10x — which proves the model works.
Why this matters: 10m+ EU retail investors trade derivatives. 25m Europeans hold crypto. The venue that offers both, regulated, in one app, wins the region.
4. eToro Strategic Investment
eToro led a $12.5m strategic investment in Extended in July 2026 & took a board observer seat. eToro has 4.3m funded accounts (40m+ registered) with 70% in EU & UK, $20b+ AUA, & is valued at $5.2b. eToro is also a revenue share partner: it earns a cut of the fees on flow it routes to Extended, so the incentive to push volume is structural.
In August, eToro users placed ~57m trades with ~$10b invested.
Phase 1 will be eToro hedging its own book on Extended (this is not customer flow & unquantified for now) + Zengo integration.
Phase 2 is the prize: customer flow. eToro will offer 24/7 perps on all assets inside the eToro app, powered by Extended's rails.
eToro flow analysis + potential impact
The analysis below is based on eToro's true notional which is $10b invested x share levered x leverage. eToro doesn't disclose volumes, so this really is scenarios.
Two things stand out:
- The decline: $24.0b to $10.7b in ten months, a 55% fall tracking the crypto bear market.
- Crypto is ~5% of the flow: crypto is a sideshow at eToro — the prize is ECC flow (stocks, FX, indices, commodities).
(Monthly invested flow derived from eToro's 6-K filings: monthly trades × invested per trade, ECC + crypto. August is eToro's own estimate as of 31 August, subject to update; September extrapolated.)
From invested flow to true notional. Invested flow is cash committed (margin), not notional — and eToro's true notional is a multiple of the $10b base. It's largely a CFD book. The maths: (ECC flow × share levered × leverage) + (unlevered ECC flow at 1x). The image runs the sensitivity: even 10% of flow levered at 2x puts true notional at $11bn; the mid case (25% at 5x) gives ~$20bn; 50% at 10x gives $55bn. That's illustrative — eToro doesn't disclose the mix — but a blended 2x is conservative for a CFD book. Note the mix: ECC is ~96% of invested flow, and ECC leverage caps run from 30:1 (FX) down to 5:1 (stocks) — far above crypto's 2:1 — so the embedded leverage sits exactly where most of the flow is.
Every 10% of that notional routed to Extended is ~$2b a month & ~$5m a year of revenue at Extended. In the mid case, with 25% routed, that's ~$5b of volume a month & ~$12.6m a year, which is ~60% of Extended's entire revenue today, from a single partner, in a bear market, at low volume.
Why 10% is conservative
- eToro's 24/5 trading now covers the full S&P 500 and Nasdaq 100 (expanded from 100 stocks in late 2025), with 24/7 rolling out on select assets — but no on-chain perps yet.
- Flow is at the depressed end: Q4 2025 ran at ~$22b a month, roughly double today's ~$10b — & leverage would amplify a recovery further.
- August's snapback was intensity, not users: trades rose 3.8x month-on-month while invested only doubled, and organic funded accounts actually fell ~70k after stripping out the Zengo/Bit2C acquisitions. The active-trader core — the users who'd actually trade perps — is engaged.
- Crypto is only ~4% of eToro's flow today; on-chain perps give dormant crypto users a reason to come back.
Caveats: builder-code revenue is gross — the eToro/Extended fee split is undisclosed. Phase 2 is the prize; Phase 1 hedging is unquantified. Near-term migrating flow is crypto-only (~$0.5b/month via Zengo); the full book follows as TradFi perps go on-chain.
eToro's CEO Yoni Assia said the Zengo acquisition “meaningfully advances our strategy of bridging traditional finance with on-chain infrastructure, prediction markets, perpetuals and the broader crypto ecosystem” — & Extended is the partner. eToro is an equity holder with a fee share, so the incentive to push flow is real. Timing is the constraint: Arc launch, licensing & integration put customer flow in Q4 2026 at the earliest. Expect Phase 1 hedging first, customer flow second — & I'd expect this to be just the beginning.
5. Circle Strategic Partnership
Circle & Extended have a ‘strategic partnership’, with Extended migrating to Arc, Circle's new L1.
Why Arc matters: purpose-built for stablecoins & FX. Sub-second finality, dollar/euro/yen-native fees, & institutional validators.
‘Circle as a key stakeholder in Extended's ecosystem’ - hmmm, I wonder what that means. Purely speculation, but I believe this is implying they will acquire Extended token.
With Extended capable of allowing any asset to be available as collateral, it wouldn't be out the question to see Circle deploy their assets, or tokenised stocks to Extended to bolster liquidity.
Arc validators are Blackrock, DTCC, ICE, Mastercard, MoneyGram, SBI Group, Standard Chartered, Societe Generale, Visa, WisdomTree, Galaxy, & they have more in the works.
USDC has a ~$73b market cap & EURC ~€400m. Circle also runs cBTC (~$500m) & tokenised RWAs like BUIDL (~$3b). All of that is potential collateral or flow for Extended.
If Extended is the flagship trading venue on Arc, Circle has every reason to push flow its way.
6. Revenue
How Extended makes money: trading fees — 0% maker, 0.022% taker, ~2.1bps net of discounts on every dollar traded. Plus spot fees & everything routed through builder codes. Liquidation fees & money-market interest go to the XVS vault alongside a share of trading fees.
Where it stands today: $1.5m of fees over the last 30 days on $7.5b of perp volume. $34m cumulative since launch. ~$20m in the treasury.
The honest caveat: some of today's $7.5b is still farmed — points hunters trading for allocation, not conviction. The volume/OI ratio (~1.4x) says the worst of it has moved on, but TGE will still take its cut: the median perp DEX loses 54% of volume in the first month (Blockworks). So don't underwrite today's ~$19m run-rate. Underwrite what replaces it.
That's where the unit economics matter. Lighter made $6.76m in Q3 on ~$133b of volume — ~0.5bps per dollar. Extended keeps ~2.1bps, ~4x more revenue per dollar traded: ~60% of Lighter's buyback firepower (~$17.1m vs ~$27m a year) on ~1/6 of the volume. Extended doesn't need to win a volume war — it monetises every dollar 4x better than the volume leader. For a buyback-backed token, revenue per dollar is the whole game.
And the mix is shifting underneath. Farmed crypto-native volume is mercenary — it leaves at TGE. What replaces it is structural: eToro's 4.3m funded accounts through a revenue-share partner incentivised to push flow; EU retail through licences nobody else holds; broker flow via builder codes; RWA & stablecoin flow via Circle/Arc. None of it is points farming. It's recurring, non-mercenary flow — & every new broker or venue stacks onto the same fee base.
Revenue scenarios. All three take the Blockworks median — 54% of volume gone at TGE. eToro flow is share of the ~$10b invested base re-levered at 5x on perps; each EU partnership is +$3b a month.
| Bear | Base | Bull | |
|---|---|---|---|
| Retained volume (post-TGE) | $3.5b | $3.5b | $3.5b |
| eToro flow at 5× | $5b (10%) | $12.5b (25%) | $25b (50%) |
| EU partnerships | — | +$3b (1) | +$6b (2) |
| Monthly volume | ~$8.5b | ~$19b | ~$34.5b |
| Annual revenue (2.1bps) | ~$21m | ~$48m | ~$87m |
Bear holds revenue roughly flat vs today (~$19m run-rate) — the TGE drop is offset by even 10% of eToro flow. Base is ~2.5x today's revenue; bull ~4.5x. The base case also lands right at the bottom of the $50–100m fee range in the valuation section.
7. Token
TGE is expected mid-to-late October, Extended have confirmed a 30% genesis airdrop for points holders & it will be the only unlocked supply at TGE. No hidden points pools or allocations (Lighter downfall), entire float at launch is for points holders.
The team has confirmed a Hyperliquid-esque buyback programme, with ~90% of revenue (after team costs) used to buy back the token.
Token Utility: Staking via validators, reduced trading fees, governance.
With confirmation of validators, the team have confirmed they will have to acquire the token from the market or I would imagine.
For each validator, there will be a minimum requirement of X tokens required & staked for X period which will add buy pressure at TGE. Assuming 1b tokens like most exchanges, I would expect the requirement will be between 0.1% to 1% of total supply, if we take 0.5%, this would imply each validator would require 5m tokens & if there are 6 to 8 validators, potentially 3 to 4% of total supply would be bought. This would be considerable considering 30% float at TGE.
No confirmed ticker for the Extended token but surely has to be $X10?
8. Farming & TGE Cliff
The Lighter case study is the template for what happens after TGE.
During farming (Nov-Dec 2025), Lighter did ~$8b of volume a day on only ~$0.8b of OI, roughly 10x, & monthly volume peaked at $252b in November.
After TGE, OI fell to ~$0.35b & monthly volume bottomed at $37b in July, down ~87% from the peak.
$LIT bottomed at ~$0.86 in March & rallied 5x, now sitting ~50% above where it launched.
It's not just Lighter. Excluding Hyperliquid, the median recent perp DEX lost 54% of its volume in the first month after TGE & 64% by the third month (Blockworks Research).
So why should Extended be different? Farmers have already moved on: Extended's daily volume runs at ~1.4x OI. Lighter was running at 4x+ while farming, which is a classic sign of volume traded for points rather than positions held. Clean supply: a 70m points cap, with points the only unlocked supply. New demand arriving after TGE: regulated EU perps, eToro flow & prediction markets all land around or after TGE. Lighter had nothing like this. Buybacks from day one: even if volume dips, 90% of revenue keeps buying the token.
The number I'll be watching: volume, OI & revenue at 30, 60 & 90 days after TGE compared to the month before. If Extended holds up better than the median launch, the thesis is working.
9. Valuation Analysis
We are in a revenue meta where projects with a good product, good future vision, & strong revenue should do well in a bull market, but it really depends on how the market prices it. On that basis, using a forward P/E framework of 18x & projected revenue in section 6, here is my floor case, bear, base case, to bull case.
This massively undersells the Extended vision with eToro & Circle behind it. But considering most farmers have probably been liquidated & are looking to sell, I think this will be the bottom & will be accumulated before up only.
The TGE cliff lands as feared (54% of volume gone), eToro never gets past a 10% trickle, & no EU partnership materialises. Revenue ends up flat vs today. The market prices it as a broken launch with good tech — cheap on fundamentals, but nobody touches it until the farmer overhang clears.
Things work roughly as announced. eToro routes 25%, one EU partnership goes live, & the retained base holds. This is the “Extended does what it said it would do” valuation.
The distribution thesis plays out. eToro at 50% of flow, two EU partnerships live, flow recovering off a depressed base, & Circle/Arc compounding on top. At that point the market stops pricing a perp DEX & starts pricing the European everything-exchange — & 18x starts to look cheap.
Polymarket implies ~$200–250m FDV — pricing the launch floor, not the earnings. That's the gap.
10. Risk & Opportunities
The honest version of what can go wrong:
- TGE cliff: the median perp DEX loses 54% of volume in the first month after TGE (Blockworks). If farmers are a bigger share of Extended's flow than the 1.4x volume/OI ratio suggests, revenue halves & the buyback bid with it.
- eToro timing: Phase 2 customer flow needs Arc launch, licensing & integration — Q4 2026 at the earliest, & regulatory timelines slip. Phase 1 hedging is unquantified; don't model it.
- EU licensing: the MiCA/MiFID II route isn't done. One delayed approval pushes the whole ‘everything exchange’ timeline.
- Competition: Hyperliquid owns ~80% of on-chain perps volume & isn't standing still; Lighter has the tech edge & Robinhood flow. Extended doesn't need to beat them — but it can't ignore them.
- Fee splits: builder-code revenue is gross. The eToro/Extended split is undisclosed, so model net with a haircut.
- Concentration: the growth story leans on two partners. If eToro deprioritises or Circle's attention moves elsewhere, the upside cases evaporate.
Against that: flow is at the depressed end (~$10b vs $24b ten months ago), the float is clean (points only, 30%), buybacks start day one, & Polymarket prices the launch at ~$200–250m FDV — well below even the comp-implied value on today's revenue. That's the asymmetry.
What would make me wrong
- It prices in the base case at launch. If XTEN lists and holds above ~$860m FDV without the revenue to back it, the mispricing case is closed, whatever the long-term story.
- eToro customer flow never routes. If Phase 2 flow does not reach Extended after launch, revenue falls back to retained volume only, and the base and bull cases go with it.
- The whitepaper rewrites the token. If the published tokenomics differ materially from the assumptions used here (30% float, points share of supply, staking utility), the valuation gets rebuilt from scratch.
Update log
- Oct 2026: Thesis published ahead of TGE (expected November 2026). Reference at publication: Polymarket implied FDV ~$236m. Conviction: High.