Here’s How DYdX Gives Crypto Traders The Security Of A DEX With The Speed ​​Of A CEX

Although nascent, the blockchain and crypto industry in India can still be difficult to navigate, whether you are a beginner or a seasoned investor. From choosing an exchange to trade on to wallet security issues and trading fees, there is a lot to consider when investing in crypto.

One of them is the advantages of decentralized exchanges (DEX) on centralized ones. These include better security, as no third parties provide custodial services in these transactions; and an easier registration process that has no KYC requirements. However, the higher transaction rates and gas fees that come with trading on a DEX have prevented users from fully embracing them.

It’s there that dYdX It’s a DEX platform that offers perpetual trading options for over 35 cryptocurrencies, including Bitcoin and Ethereum – but it does so without users having to pay gas fees, offering even free trading fees up to $100,000 in volume per month.

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The next level of trading

It is able to do this thanks to its platform built on a layer 2 protocol on the Ethereum blockchain, offering traders the security and transparency of a decentralized exchange, as well as the speed and user-friendliness of a centralized exchange. . dYdX users have full control over their assets and the company claims it is the first crypto exchange to offer truly free trading for all users, in all markets.

Founded in 2017 by Antonio Juliano, dYdX was originally designed to offer crypto trading, lending, and margin borrowing services on Ethereum Layer 1. But the need to move to Layer 2 soon became apparent, as the company has seen trading fees on its platform skyrocket at times.

Who is going to use an exchange where you have to pay a hundred dollar fee to make an exchange – nobody. That was the first overriding problem we had to solve, Antonio said Without a bank in 2019.

dYdX soon began working on the Layer 2 protocol for its cross-margined perpetual platform, in partnership with Israeli blockchain software company StarkWare. The launch of the new Layer 2 platform has led to an increase in execution capacity in the DeFi (decentralized finance) derivatives market.

Currently, dYdX accounts for approximately 90% of decentralized perpetual trading volume, with an average daily volume of $1.3 billion, making it one of the largest decentralized exchanges in the world by trading volume. With a market share of over $600 billion in total realized volume and over 25,000 traders, the platform has understandably seen a host of global investors backing it, including Andreessen Horowitz, Paradigm, Polychain, Naval Ravikantand more.

foundation for the future

To foster the growth, expansion and decentralization of the dYdX community, the dYdX Foundationan independent Swiss entity, was established in August 2021. The dYdX Foundation helps educate the community about crypto trading and blockchain technology and allocates resources to foster community growth in the dYdX ecosystem.

David GogelHead of Growth and Operations at dYdX Foundation, says: The gradual shift to community governance and decentralization will be achieved by emphasizing the lack of trust, security and stability. To this end, an independent foundation, the dYdX Foundation, headquartered in Zug, Switzerland, has been established to help propel the Protocol into the future. By fostering decentralized governance and empowering traders with powerful, transparent, and open advanced financial products, the dYdX Foundation advances the dYdX protocol toward community-led growth, development, and self-sufficiency.

In line with this fully decentralized approach, the foundation launched the DYDX governance token that allows users to shape the future of the platform by allocating community treasury funds, deciding new token lists on layer 2 protocol, controlling risk settings for layer 2 protocol 2, determine security pool payouts in the event of losses, create governance contracts themselves, and more.

The DYDXtoken is a governance token that allows the dYdX protocol community to truly own and govern the dYdX protocol. By enabling shared control, DYDX aligns incentives between merchants, liquidity providers, and protocol partners. DYDX enables a robust ecosystem around governance, rewards, and staking – each designed to drive future growth and decentralization of the dYdX protocol, David adds.

dYdX also launched a collection of 4,200 NFT avatars earlier this year called Hedgies. With a design inspired by – as the name suggests – hedgehogs, Hedgies are offered as a reward to successful traders on dYdX and other champions in their community, offering them discounts on trading fees and special access to the governance community.

And after?

In addition to raising awareness within the crypto community, dYdX is expanding its global brand to markets such as India, Turkey, Japan, Korea, Germany, Austria and Switzerland, enabling developers of the Web3 space to integrate with dYdX. thanks to grants.

After the successful deployment of the Layer 2 protocol, dYdX now focuses on dYdX V4 – a fully decentralized standalone blockchain based on the Cosmos SDK and the Tendermint Proof-of-stake consensus protocol. It will feature an off-chain order book and matching engine, which the company claims will be able to scale to orders of magnitude more throughput than any current blockchain can support.

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Here’s How DYdX Gives Crypto Traders The Security Of A DEX With The Speed ​​Of A CEX

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