Crypto derivatives platform dYdX announced of deploying own Blockchain on Cosmos
dYdX which is
a crypto derivative focused decentralized platform based on Ethereum layer-2
blockchains, announced its plan of deploying its own blockchain. To process the
transaction, the new product dYdX V4 will be
based on Cosmos SDK and use Tendermint’s proof-of-stake (PoS) consensus protocol. dYdX’s fourth iteration (V4) will be supported by
the new chain.
The Layer1 token for dYdX V4 will be native to the chain. The Cosmos ecosystem consists of interconnected blockchains custom developed for specific applications. Validators must stake the token that was airdropped last September in order to secure the network under a proof-of-stake consensus mechanism. Further, with the new chain, transaction fees would be paid in DYDX tokens. The network will match orders together on a real time basis. The announcement post says, “The most natural fit for use as the L1 token of dYdX V4.”.
dYdX's plans to turn the DEX protocol into one of cryptocurrency's biggest exchanges and they are confident of it’s success if it is led by co-founder Uber engineer Antonio Juliano. As per the team, it hasn’t settled on the DYDX token, as the community will need to have an input on that. The platform plans to build dYdX and open source it by the end of 2022.
According to a blog post, the platform noted that dYdX V4 orderbook and matching engine will be fully decentralized off-chain and is capable of scaling to orders of magnitude more than any blockchain. In a Twitter thread, the team said developing a decentralized off-chain orderbook and moving from Ethereum to a dYdX-specific chain as a major DeFi protocol is not tested and this will give dYdX the best shot at offering a competitive product experience with centralized exchanges.
To scale decentralized trading dYdX partnered with StarkWare in August 2020. In June 2021 The company raised $65 million in a Series C funding round which was led by Paradigm.
About dYdX :
dYdX is one of the largest crypto derivatives platforms in the market. In 2017 dYdX was founded by ex-Coinbase and Uber engineer Antonio Juliano. The exchange laid out by the company in January and by the end of the year it is fully decentralized. dYdX with more than $690 million in trading volume in the past 24 hours and over $700M in Total Value Locked (TVL), it is positioning itself as the largest decentralized derivatives trading platform. According to the company, the current dYdX product processes about 10 trades per second and about 1,000 order placements/cancellations per second.
CBW - External Analyst