# We Love The Token, We Want The Token!

> Why the Future of Trading Needs a New Model. Why FRWA Are Part of It

**Published by:** [The Fedz Blog](https://blog.thefedz.org/)
**Published on:** 2025-12-07
**Categories:** perps, perpetuals, cfd, cfds, trading, tokens, crpyto, dex, cex
**URL:** https://blog.thefedz.org/we-love-the-token-we-want-the-token

## Content

Crypto was born with a simple promise: users should own their money, their assets, and their financial ownership. But somewhere along the way, we lost part of that promise. Today, trading crypto feels modern, fast, and polished. But, also strangely centralized. Most trading now happens inside closed platforms with a great UI but very little transparency. And in the process, we drifted away from the openness that originally made DeFi powerful. This article is not about the mechanics of TheFedz.XYZ or how FStocks and FRWA work. This is about why we need them and why the entire ecosystem needs a new model for trading, owning, and issuing digital assets on-chain. Let’s start at the beginning.1. Crypto Trading Has Become a Closed GardenIf you were here in 2017 or even 2020, trading crypto felt like a frontier. Everything was open: anyone could mint a token, anyone could provide liquidity, and anyone could build the next financial primitive. Today, the experience feels very different. Most users trade on platforms that look like DeFi but operate more like centralized exchanges (CEXs):They decide how prices move.They run the risk engine.They handle liquidations.They allow or block trading pairs.And often, no one outside the protocol can see what’s happening behind the scenes.The interfaces are beautiful, but the systems underneath are not open. They’re closed loops designed for speed and efficiency, but not transparency and most important without user ownership. Crypto became easier to use, but less “crypto” in spirit. And the biggest example of this shift is the rise of perpetual futures.2. Perpetuals: The Product That Took Over EverythingPerpetual futures (or “perps”) have become the default trading product in crypto—both on CEXs and DEXs. Why? Because they’re fast, familiar, and capital-efficient. They let traders bet long or short on any asset, 24/7, with leverage. But here’s the truth that most beginners don’t fully realize:Perpetuals were not designed for DeFi. They were designed for trading desks and high-frequency professionals.And when you build a system around perps, you inherit everything they come with:ADLs (Auto-Deleveraging), where your winning position can suddenly be reducedopaque mark prices and funding ratesinternal matching enginesprivileged and sometime vague roles managing riskEven "decentralized" perp platforms copy this logic. Most of them run internal orderbooks and risk models that users can't audit in real time.**They work great for short-term trading.They work terribly for long-term ownership.** Perps are incredible tools—but they represent only a very small part of the market. Most people don’t want 20x leverage. Most people just want asset exposure, the ability to hold value, and the ability to buy or sell without losing 5% to slippage. The crypto industry optimized for the wrong group. It optimized for speed traders, not the everyday user. So what about the alternatives?3. AMMs: The Original DeFi Vision (And Its Limits)Automated Market Makers (AMMs) changed everything when they appeared. Uniswap allowed anyone, not just institutions, to participate. Anyone could create a token, start a market, or trade without asking for permission. There was no orderbook, no matching engine, no gatekeeping. It was a revolution. For the first time, markets belonged to the users. But revolutions don’t stay perfect forever. Over time, we discovered that the AMM model has two deep structural problems:1. LVR (Loss vs Rebalancing)LPs systematically lose value just by doing their job, rebalancing as prices move. Even in a healthy market, even without hacks or bad trades, LPs slowly bleed compared to simply holding the assets. That is already a serious limitation.2. MEV — The Invisible Tax on Every AMM TradeWhile AMMs were built to be open markets, the blockchain environment introduced something they were never designed to withstand: MEV (Maximal Extractable Value). MEV bots sit between every user and the pool. They reorder transactions, front-run trades, sandwich users, and extract value from LPs every time prices shift. It works like this:You try to trade → a bot sees you firstIt jumps ahead of you, buys before you, sells after youYou get worse executionLPs get worse returnsThe bot pockets the differenceThis is not a bug. This is a structural property of how public blockchains and AMMs interact. As a result: AMMs became predictable targets for MEV extraction. Every rebalance becomes an opportunity for arbitrage bots. Every price move becomes a transfer of wealth—from LPs to sophisticated actors. The outcome is simple:LPs earn lessLiquidity thins outSpreads widenOperating deep markets becomes expensiveAnd because the problem is structural, not technical, upgrades and new versions haven’t solved it.Where Does This Leave Us?AMMs are still the most open, permissionless trading model in crypto. They represent the spirit of DeFi better than anything else. But mathematically and economically, they’re stuck. They cannot provide the depth, stability, and efficiency needed for high-volume assets like tokenized stocks, at least not in the Arbitragers VS LPs zero sum game. Without solving MEV and LVR, AMMs cannot become the foundation for the next generation of tokenized markets. So where else can we look?4. Tokenization: Can we scale it in the 1:1 model?! One of the biggest ideas in crypto is tokenization: taking real-world assets and turning them into on-chain tokens. Stablecoins proved that this works. USDC and USDT created a new world of digital dollars and became the backbone of everything we do in DeFi. But the model has limits.1:1 backing is safe, but incredibly expensive.To issue $1B of stablecoins or tokenized stocks, you need $1B sitting in a bank or custodian. That works for dollars because the issuer earns interest on the collateral. But for stocks? For commodities? For anything else? It's impractical. No issuer will lock billions of dollars to issue tokenized versions of hundreds of different assets. That’s why on-chain stocks today are tiny markets:extremely low supplymassive slippageno liquidityno real trading experienceTokenization is a massive idea stuck behind an economic wall.And even worse:1:1-backed assets are centralized. They can be frozen, paused, censored, or confiscated. So while tokenization shows us the future, the current model cannot bring that future to life. To unlock global tokenized markets, we need a structure that is:more decentralizedmore affordablemore scalablemore openWe need a model designed for tokens—not copied from traditional finance.5. The Real Problem: Everything We Built Is Not Token-NativePerpetuals copy centralized trading. Stablecoins copy traditional banking. AMMs copy automated exchange engines. But where is the system actually designed around tokens themselves? Where is the model that says:tokens should be cheap to issuetokens should be easy to tradetokens should be held directly by userstokens should have predictable liquiditytokens should not require billions of dollars to existtokens should not rely on centralized custodiansThe answer is: We haven’t built that model yet. Crypto still operates with financial structures imported from the old world. That’s why fragmentation, poor liquidity, and limited asset supply keep holding the industry back. If we truly “love the token,” then the entire market structure must be built for the token—not around legacy financial logic. And that leads us to the next step.6. What the Future Needs: A New Model for Tokenized AssetsTo build an open and scalable token economy, we need a model that:allows users to self-custody assetssupports minting without full 1:1 collateralcreates liquidity that grows with usagealigns long-term stability with affordabilityworks for traders and holdersremains fully on-chain and transparentIn other words:We need a token model that balances decentralization with economic efficiency.This is the design philosophy behind The Fedz. The Fedz does not try to replicate traditional finance. It tries to rethink it. It asks a simple question: What if tokens didn’t need full collateral to exist, only well-designed, transparent, on-chain rules? That’s not science fiction. It’s the foundation of fractional-reserve systems, bank-run research, and modern monetary design. And when you apply this thinking to tokenized markets—you unlock something powerful.7. FStocks: Tokens Built for Holding, Trading, and OwningFStocks are not just “tokenized stocks.” They are a new class of digital assets designed for:real liquidityon-chain transparencyaffordabilitylong-term user ownershipThey don’t require 1:1 collateral. They don’t rely on a centralized issuer. They don’t depend on high-frequency traders to keep markets alive. They’re built around a completely different idea:Markets should be powered by the users who love the token—not by institutions that control it.This is why The Fedz focuses so much on:fractional-reserve mintingprivate liquidity poolssequential accessFUSD as the base moneytransparent on-chain balance sheetsThese pieces work together to create a system where:tokens can be issued sustainablyliquidity is predictableusers stay in controlprices remain stable in the long termand access is open to everyoneIt is a token-native framework for token-native markets.8. Conclusion: If We Love the Token, We Must Build for the TokenCrypto's next evolution isn't another perp exchange. It’s not a shinier UI. It’s not another centralized “DEX.” And it’s not another overly expensive 1:1 tokenization initiative.It’s a different path:Users should own their assets. Markets should be open. Tokens should be affordable and accessible. To get there, the industry needs a new architecture, one designed for tokens as they truly exist on-chain. The Fedz is building exactly that. We’re not just building a new product. We’re building a new model. A structure where users can hold, mint, and trade real assets in a way that is:decentralizedeconomically efficientand scalable to millions of usersBecause at the end of the day… We love the token. We want the token. And it’s time the market is redesigned around that simple truth.

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