ZeroEx raises $24M in an ICO for 0x protocol that enables the trading of Ethereum's ERC-20 compliant tokens without the need of centralized exchanges
Christine Chiang / Brave New Coin :
Context & Ripple Effects
In August 2017, ZeroEx bypasses venture capital entirely and funds the 0x protocol through a $24M ICO — an early instance of a core piece of Ethereum market infrastructure being financed directly by token buyers rather than equity investors. The bet was that ERC-20 token trading could run on shared, open rails instead of inside walled-off exchanges.
That bet aged well enough to attract institutional money twice over: 0x Labs followed up with a $15M Series A led by Pantera Capital in early 2021, then a $70M Series B led by Greylock with OpenSea and Coinbase participating in 2022 — the same investors who own the centralized venues the protocol was designed to route around.
First-order effects
- Token purchasers now hold a stake in a protocol whose value depends on third-party 'relayers' adopting 0x to match orders, aligning incentives across builders rather than concentrating them in one exchange operator.
- Centralized Ethereum exchanges gain an open-source competitor whose order-matching layer anyone can plug into without paying listing or custody fees.
Second-order effects
- A new relayer and liquidity-aggregation layer emerges between traders and the protocol, creating a market for whoever can source order flow — the same infrastructure niche 0x Labs itself later monetized.
- The ICO-as-infrastructure-funding model spreads to exchange incumbents' challengers: Overstock's tZero raised $134M the following year building regulated alternatives, showing both sides of the market racing to tokenize their capital formation.
Third-order effects
- Exchange infrastructure trends toward composable protocols embedded in other products — the path later taken by firms like Zero Hash letting fintechs and brokers integrate crypto natively — shifting competitive moats from custody licenses to distribution.
- If protocol-level trading keeps displacing venue-level trading, regulators face pressure to define whether governance tokens are securities, since the funding mechanism that launched 0x sits outside the equity framework its later VC rounds fit squarely within.
The trend: Crypto market infrastructure is migrating from centralized exchanges toward open, token-funded protocols that venture capital later institutionalizes — with 0x as one of the earliest templates.