Annanay Kapila, CEO & Founder of QFEX, joins us to talk about his journey from high-frequency trading at Flow Traders and Tower to building a revolutionary exchange platform. We discuss how crypto market structure solves traditional finance inefficiencies, his Y Combinator experience, regulatory strategy, 100X leverage mechanics, prediction markets, and why sports betting actually works. Launching December 2025.

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Notes:
• Tower did half of all major exchange volume
• QFEX raised funding through Y Combinator
• YC takes 7% equity for $125K investment
• Bitcoin trades at 100X leverage on exchanges
• S&P futures limited to 10X leverage
• QFEX waitlist hit 10,000 people

Timestamps:
00:00 Start
00:03 Annanay Kapila
02:08 Y Combinator
05:23 Market inefficiencies
09:03 Designing QFEX
12:50 Hyperliquid & Perps
18:30 Zero fees vs UX
22:36 Sharp flow & fees
27:12 Intermediating market makers
34:26 Misaligned incentives
40:53 Perps use cases
45:52 Perps vs Options
49:33 Market fragmentation
58:47 Kalshi vs Polymarket
1:06:23 KYC
1:10:37 Are prediction markets useful?
1:13:02 Wrap

The Gwart Show is sponsored by Ellipsis Labs. Backed by Paradigm, Electric Capital and Haun Ventures. The founders, Eugene and Jerry, have experienced Citadel Jane Street in the Solana Core team since launching their order book DEX, Phoenix. They’ve done over $80 billion in trading volume by making onchain order books competitive with centralized exchanges. 

Ellipsis is hiring for New York-based engineers. Work with a small focus team who are results driven, collaborative, and use a modern stack. If you’re an engineer who wants to work on infrastructure that’s already proven itself in the market, go to ⁠⁠ellipsislabs.xyz⁠⁠.

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