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DYDX Exchange

dYdX ($DYDX) is a decentralized exchange (DEX). It is one of the biggest DEXs in the world by trading volume and market share. dYdX specializes in perpetual swaps for some of the leading cryptocurrencies by market cap.

History of dYdX

Antonio Juliano founded the dYdX exchange protocol in July 2017. It launched as a layer-1 protocol with crypto margin trading, lending, and borrowing the Ethereum blockchain. In February 2021, the platform launched a closed alpha for a Layer2 cross-margin Perpetuals product built on Starkware’s StarkEx scalability engine. The Layer 2 product went live in April 2021 as its own chain/rollup, leaving Ethereum.

Thanks to the increased throughput offered by Starkware, the platform was able to switch to cross margining. It meant that multiple positions can be collateralized using a single margin account. The result was better liquidity and the ability to launch more markets, 30+, up from 3. Trading spiked by almost 5x to around $30 million a day.

In the summer of 2021, the team launched the dYdX Foundation, which is an independent Swiss Foundation. The Foundation then released the DYDX token in August 2021, which is the native token of the dYdX protocol.

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The March to Full Decentralization

To build trust in its services, dYdX has pursued a policy of increased decentralization. Today, most of the exchange runs on trustless protocols, which are extensible without permission. The team is currently working on V4 of the DEX, which will be fully decentralized. They state that this is their highest priority now.

As part of the V4 launch, dYdX plans to make the front-end codebases open source. It will enable anyone to deploy the dYdX front end using their own hosting solution. The team is working on three front ends, which include a web app, an iOS app, and an Android app. Multiple deployments of the front end will help increase access to the trading platform via multiple domains.

On October 17, 2023, dYdX announced they had become a Public Benefit Corporation via a tweet. The move signals a move towards the goal of decentralizing every aspect of the DEX. It will ensure that dYdX does not generate any transaction fee revenue from the upcoming V4 launch of dYdX.

However, dYdX Trading Inc. will continue to be a for-profit company. It will continue to earn revenue from previous versions of the DEX, including V3. Despite this, the move will ensure the company’s board and founder can balance profit maximization while acting in the best interest of the public.

DYDX Token Details

DYDX is the native token of the dYdX exchange protocol. There is a maximum supply of 1,000,000,000 DYDX tokens, with a market cap of $332,966,493 and a circulating supply of 183,765,523 DYDX tokens. The token’s fully diluted market cap is $1,811,831,873.

For the past 24 hours, the volume of the DYDX is $29,578,648, at a price of $1.81 per token. Most of the trading volume is on SuperEx, HTX, BIKA, Bitrue, and Binance, which account for close to 99% of the trading. The token’s all-time high was on September 30, 2021, when the price reached $27.78. Its current price is a 93.48% discount on the ATH.

The Future of dYdX Looks Promising

dYdX currently dominates the DEX sector with a derivative trading volume of $612,571,852.78. With DYDX having numerous use cases within the DEX, its future looks bright. The upcoming V4 launch, which is in the testnet phase, will happen in the next few weeks. Its launch will see various operational elements like order book management and a front-end transition to outside validators and entities.

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