Identify a problem, ideate on a solution, build it, launch it, and then scale it. This is the tech startup playbook.

Right now, former Chainlink Hackathon winner and current Chainlink BUILD member Krypton is at step number four: launch. It took the Krypton team more than two years of researching, building, and optimizing to get to this point—with Krypton’s Early Access beta set to launch soon.

In this Chainlink Hacker Story, we’ll cover Krypton’s journey from idea to launch to help you understand what it takes to bring a Web3 startup idea to life. 

What Is Krypton?

Krypton is a cutting-edge decentralized exchange (DEX) that aims to make trading cheaper by protecting users from the many hidden costs of DeFi trading, which include maximal extractable value (MEV), adverse selection, and frontrunning. These problems also exist in traditional finance, where retail traders collectively lose tens of billions of dollars to frontrunning and payment for order flow (PFOF). 

Created by Co-Founders Michael Nowotny and Nathan Moore, Krypton aims to solve these perennial problems by executing orders as continuous streams over time at finite trading speeds. Put simply, this means that high-speed frontrunning and arbitrage traders have to telegraph their urgency to trade, and are met with counterparty trading speed caps and price resistance. This heavily disincentivizes these activities: It is simply prohibitively expensive to try and profit off of slower traders and market makers on Krypton.

Krypton’s Origins

The idea for Krypton was first conceived by Michael Nowotny while he was brainstorming on automated decentralized asset management. He knew that inefficiencies in AMM design prevented cost-effective portfolio management in DeFi, but he wasn’t entirely sure how to solve the problem.

“Find a tangible problem that people are struggling with and try to solve it—or better yet, set out to solve a problem that’s been bothering you. This might not seem very glamorous, but we think it’s the best way to build something with long-term value.”—Nathan Moore, Co-Founder

So Michael set his mind to discovering a better way to build a decentralized exchange mechanism, and that started with research, bringing him back to his academic roots. In his research, Michael found that the idea of a fully continuous exchange could be implemented within DeFi and solve the problems of frontrunning, MEV, and adverse selection—but only if it was possible to find an appropriate source of scalable offchain computation.

This was the first challenge for Krypton, and it had to be solved before a single line of code could be written. After some market research, Michael realized that Chainlink decentralized oracle networks (DONs) could provide the scalable offchain computation his hypothetical exchange needed. With that problem solved, and the architecture of what would become Krypton in mind, Michael shared the idea with Nathan Moore and asked Nathan to join him as his co-founder.

Building Krypton’s First Proof of Concept

The transition from idea to execution is difficult for any startup, and Krypton was no exception. To kickstart the building process, and to receive valuable technical support and knowledge about using Chainlink, the co-founders decided to join the Chainlink Fall 2021 Hackathon. 

“Nothing focuses your mind like a hackathon. Getting to meet and ask questions of the team at Chainlink Labs, and most importantly the whole hackathon community, was extremely valuable for us as we built the first Krypton prototype.”—Michael Nowotny, Co-Founder

After spending countless hours and long nights building Krypton’s first proof of concept, the team finally had the chance to submit their project in November 2021. The judges were impressed, and Krypton ended up winning the first-place prize ($15,000) in the DeFi category for their innovative solution, sound implementation, and succinct hackathon presentation. 

Many hackathon teams stop here, using their winning hackathon projects as a badge of honor to unlock future opportunities. But Michael and Nathan had much bigger plans for Krypton—and winning the Chainlink Fall 2021 Hackathon was simply one of the first steps.

“I believe that Krypton wouldn’t exist without winning the Chainlink Fall 2021 Hackathon DeFi Prize. It made people take notice of us and gave our idea more credibility. If you want to let people know you’re a serious project, win the Chainlink Hackathon!”—Michael Nowotny, Co-Founder

The Road to Krypton’s Launch

Building a proof of concept is an intensive technical challenge, but it pales in comparison to formally launching a startup and committing to a multi-year journey, where founders must consider everything from funding and marketing to production at scale.

That said, Michael and Nathan knew that they were onto something. They had already spent months ideating on their solution, the exact problems it solved, and the mechanism by which their idea would work. They were committed to bringing the idea of Krypton to life in the real world. 

“We believed in Krypton before anyone else did. I spent months trying to find all the reasons why our mechanism design might not work, and I proved to myself that this was the answer long before bringing anyone else on board. Nathan did the exact same thing when he joined.”—Michael Nowotny, Co-Founder

As they continued to build on top of their proof of concept, the team encountered an unexpected opportunity: The Chainlink BUILD program was being created (the program launched in the fall of 2022), and Krypton was asked to be one of the first-ever startups to join the BUILD program.

“We were really lucky to be one of the first BUILD projects! We spent time getting to know the Chainlink Labs team and the Chainlink vision, and we were very eager to contribute to the Chainlink ecosystem however we could.”—Nathan Moore, Co-Founder

The Chainlink BUILD program was an opportunity for the Krypton team to join a robust community of talented founders, receive best-in-class technical support and knowledge from the Chainlink Labs team, and play a central role within the Chainlink ecosystem. So they accepted. Since Krypton joined Chainlink BUILD, the program has expanded to encompass 70+ startups representing many of the most promising projects in the Web3 industry.

“Being part of Chainlink BUILD means we’re at the center of the Chainlink community. It’s not just about receiving discounts from the program’s many partners, but also being a part of a strong community of founders, leading Web3 protocols, and knowledgeable enthusiasts. This is invaluable for kick-starting and maintaining real innovation.”—Nathan Moore, Co-Founder

Over the course of 2023, the Krypton team has accelerated its journey to mainnet as part of Chainlink BUILD, and the project is on the cusp of launching its Early Access beta—marking the first time the Krypton exchange will be accessible to the larger market. 

While there are still a variety of challenges on the road to public mainnet (as all startups face), the Krypton team today has a great community of partners, advisors, and additional teammates who are setting them up for success as they continue on their road to public launch. 

“In addition to our patent-pending matching engine and ground-breaking decentralized compute technology, we needed to develop sophisticated algorithmic tools to help our users effectively trade on Krypton. My advice: If you think big, you might need more time and resources than you thought to realize your vision.”—Michael Nowotny, Co-Founder

Follow Krypton’s Journey

For more information on Krypton, and to follow the latest developments on the team’s cutting-edge decentralized exchange, follow the official Krypton Twitter account and visit the Krypton website. For those interested in trying out Krypton’s cutting-edge decentralized exchange, sign up for early access.  

Chainlink BUILD is a Chainlink Labs initiative designed to help both early-stage and established Web3 projects grow by providing them with enhanced access to Chainlink services and technical support. If you and your team are pushing the limits on what’s possible with Web3 technology, apply here.