dYdX

What Is dYdX?

dYdX is the developer of a leading non-custodial decentralized exchange (DEX) focused on advanced crypto products — namely derivatives like crypto perpertuals. dYdX runs on audited smart contracts on blockchains like Ethereum, which eliminates the need of trusted intermediaries. The origins of the name is obtained from the mathematical derivative equation: dy/dx, a measure of rate of change. The DEX launched its own native token — $DYDX — in August 2021, to function as a governance token for voting on proposals and as rewards for traders based on their trading volume on the platform.

To scale trading, dYdX and StarkWare launched a custom-built layer 2 (L2) protocol for cross-margined perpetuals on Feb. 24, 2021. It is based on StarkWare’s StarkEx scalability engine, based on zero-knowledge rollup (zk-Rollup) technology, and dYdX’s perpetual smart contracts. Traders can now trade with zero gas costs, lower trading fees and reduced minimum trade sizes.

As of June 2022, dYdX has announced that for v4, they will launch their own independent blockchain based on Cosmos SDK and Tendermint PoS. The team stated the motivation behind their move was the speed and other centralization concerns surrounding Ethereum L2. The team believes that this switch will help them improve their performance and meet their goal of total decentralization by the end of the year.

Who Is the Founder of dYdX?

Antonio Juliano, a former Uber developer and Coinbase software engineer founded the platform in 2017, and the protocol launched in 2019. Juliano studied Computer Science at Princeton and left university with a desire to work on tech startups. Working at Coinbase, he grew excited about Ethereum and hoped to build something atop the network. Initially building a decentralized application (DApps) search engine, Juliano decided to introduce margin trading into the decentralized finance (DeFi) world and conceived the idea for dYdX.

Where Is dYdX Located?

The headquarters is in San Francisco. However, the team behind the protocol recently launched the dYdX Foundation which is headquartered in Zug, Switzerland. Users can access the exchange from all over the globe, except from the following countries: Cuba, North Korea, Iran, Iraq, Burma, Libya, Mali, Democratic Republic of Congo, Cote D’ivoire and Nicaragua, Somalia, Sudan, Yemen, Syria, Zimbabwe and any country that is currently being sanctioned by the U.S.

What Coins Are Supported on dYdX?

At the time of writing, the list of popular perpetual trading pairs on dYdX includes Ethereum, Bitcoin, Solana, Polygon, Avalanche and Uniswap.

How Much Are dYdX Exchange Fees?

dYdX does not charge any deposit or withdrawal fees, and no gas fees are charged when trading on layer 2. However, the protocol employs a maker-taker fee structure that determines and weighs trade fees by volume. With their trade fee model, holders can receive fee discounts based on the size of their current holdings.

Is It Possible To Leverage or Margin Trade on dYdX?

At the time of writing, traders can go long or short with 20X leverage on BTC and ETH markets, and 10X on all other markets.