DYdX is the world's first decentralized digital currency derivatives trading platform. Unlike the common automated market maker model (AMM), dYdX uses the order book model DEX, which supports spot trading, margin trading and contract trading.

It aims to build more open, transparent and secure financial products through decentralized technologies.

The futures DEX track will further develop, with the further improvement of product experience and product situation innovation, the total trading data will continue to expand, and in the next few years, it is expected to gradually accept the trading volume originally existing in the centralized derivatives exchange.

DYdX holds the promise of explosive growth in the futures DEX and even the entire decentralized derivatives market. In its first trading mining cycle in August, "mining" traders generated $9.8 billion in trading. From the perspective of transaction organization, it adopts the order book style, with professional market makers making markets and LP providing part of the market making funds. DYdX product experience is good, using the transaction engine StarkEx developed by Ethereum layer 2 network project Starkware, to achieve self-hosting of decentralized assets (users transfer funds from wallets to smart contracts for hosting), and achieve low Gas and high transaction speed. DYdX attracted large amounts of liquidity by introducing multiple liquidity providers as investors in its Series C financing, designing transaction mining and liquidity provider incentive rules. The underlying technical architecture of dYdX is decentralized, and its operation mode is closer to a centralized exchange than other DEX.

DYdX currently offers five products: perpetual contracts, margin trading, leveraged trading, spot trading and lending. The V2 version of perpetual contracts is a new product built on the layer 2 network. Margin trading, leveraged trading, spot trading and lending are three products built on Layer1, the main network of ethereum. DYdX's perpetuity interface has most of the functions of a centralized contract interface. The details of its perpetuity products are as follows: Leverage: dYdX's perpetuity products offer up to 25x long-short two-party trading with a minimum leverage change of 0.01. Order book /AMM: From the point of view of trade settlement, dYdX perpetual contracts are in order book form and liquidity is provided by market makers (note: this is also the case for dYdX's other products, which will not be described here). In terms of the product interface, it has a market interface similar to that of the centralized futures exchange, which can display the red and green candle chart of prices, but the minimum time unit displayed is hour, that is, 15 minutes /1 minute and time-sharing trading cannot be provided yet. Limit/stop-loss: dYdX perpetual contracts have both limit and stop-loss functions, allowing for limit trades and stop-loss and gain trades. Margin: BTC and ETH trading pairs have a maximum leverage of 25 times, so the initial margin requirement is 4% and the maintenance margin requirement is 3%. Other trades have different margin requirements based on their maximum leverage. Strong flat price/clearing price: The mark price used for clearing is the index price fed by Chainlink's second floor price. Deposit/withdrawal: In the upper left corner of the page, Account balance is displayed, and there are two buttons: Deposit and Withdraw. Since the product is set up on the layer 2 network StarkWare, the transaction of dYdX sustainable contract product is conducted within the balance range after funds are deposited. The money goes back into the dYdX account and requires a withdrawal to return to the trader's Ethereum wallet.

DYDX is a governance Token that allows the DYDX community to hold and govern the DYDX protocol. It is mainly used for dYdX protocol governance and handling fee discount.

DYdX: Using Starkware's StarkEx engine matching and chain settlement to achieve self-custody of assets, the transaction organization is point-to-point matching, mainly made by professional market makers to provide liquidity. Decentralized asset self-custody can be achieved by using StarkEx transaction engine (depositing/charging on StarkWare, a two-layer network). According to StarkWare and dYdX, self-hosting is secure. This business logic is similar to a centralized exchange in that it is a technical way to achieve a decentralized version of a centralized peer-to-peer exchange. The entity behind dYdX is a company whose business model is similar to Binance's in that it makes money by charging transaction fees, which means that the transaction fees paid by the trader in the transaction (excluding the capital fee for the perpetuated contract) may be owned by the entity and may not be distributed to the community. (Usually the agreement only receives a portion of the fee, and a portion of the fee is distributed to the holder & community). From the point of view of user fund security, mainly is whether the user's fund "custody" is guaranteed, which mainly refers to the security of the layer 2 network scheme, dYdX uses StarkEx, Perp V1 uses xDai, V2 uses Arbitrum. StarkEx and Arbitrum security from the setting have high security, but can not be said to be "very safe", they need to continue to accept the test of the market and time, to see whether can in the long term performance security, in a variety of attacks and extreme market can not occur failures and accidents. DYdX is equivalent to the centralized exchange to achieve self-custody of assets, avoiding the risk of centralization after the exchange runs away, the exchange manipulates the market with users' assets, the exchange embezzles assets and other funds transferred to Cex. At the same time, the idea is to use StarkEx's high performance and quality products to simulate similar to the centralized trading experience. And at present, the main force is in the head varieties such as BTC, ETH and so on. Therefore, there is no open and free creation market, and professional market makers are mainly engaged in market making. Its founders also say they want to compete for customers, especially "professional" ones (typically high-volume professional traders and institutional traders), just as centralised exchanges such as Binance and FTX do.

While introducing a large number of professional market makers and trading mining, dYdX also conducted liquidity provider mining. The time and cycle (Epoch) Settings were the same as trading mining, and each Epoch was awarded 1.15 million coins. DYdX has both "liquidity offering mining" and "liquidity Pledge Mining". "Liquid Provider Reward" refers to the Reward given to market makers. The threshold of Reward is that a single market maker should reach more than 5% of the trading volume of all market makers. Rewards include uptime, side depth, bid-ask spreads and number of trade pairs supported, among other things. In the first Epoch, a total of five market makers reached the threshold and allocated 1.15 million DYDX pieces according to a formula.

DYdX belongs to the futures exchange (futures DEX) in the Defi- Derivatives circuit, and it belongs to the order book futures DEX. Currently, orderbook-like projects in a decentralised futures exchange include dYdX, DerivaDEX (offline), Injective Protocol(offline), Vega Protocol(offline) and others. Amm-style futures DEX includes Perpetual Protocol, McDEX (just launched on August 31), dFuture, and more. Perpetual Protocol is the only project with strong comparative value in terms of product mechanism and operation data due to its long online time. Perpetual Protocol is an AMM-type futures DEX offering Perpetual contract products. It continues to develop vAMM pricing in the FORM of AMM. In the V1 version, Perp separates pricing and settlement. In addition, the role of market maker (i.e. liquidity provider and LP in AMM) has been removed to realize the simple market structure of game between long and short parties. By August 25, the daily average trading volume within 7 days was $110 million, which ranked second in terms of data volume.

At present, dYdX is the leader in terms of attracting liquidity providers, trading volume during transaction mining, and product use experience, and it mainly focuses on the head products. Its strengths are partly Starkware and its own technical capabilities, partly the ownership of head capital and liquidity providers, and partly the design of trading mining mechanisms. Indeed, partly because it now operates as a centralised exchange, similar to Binance and Bybit, making it easier for liquidity providers and specialist traders to migrate. However, in the long term, Perp may establish an advantage in the long tail market, its V3 launch may also have new improvements in mechanism and operation, and the successive launch of Vega Protocol and other protocols may also bring changes in market share. It remains to be seen whether dYdX's current high market share and high trading volume can be sustained, and whether other agreements and projects can explode in the next exponential trading volume growth that the whole track of Futures DEX still has. Is a class-centric business model the best model in the long run? This question will be tested in the future development of the Futures DEX track.

1) Security and failure risk: Due to the dark forest nature of Defi world and the nature of the software itself, both dYdX itself and its layer 2 network may have security and failure risks, including but not limited to: Risk of loss of hosting funds, risk of attack on exchange or Layer 2 network StarkEx, risk of trading loss caused by layer 2 network failure, security risk and failure risk of dYdX product protocol itself, such as pins, bugs, front-end crash, etc. 2) Underdevelopment risk: The futures DEX track is developing rapidly and there are many competing products, so its leading position may be challenged; Before the launch of dYdX, due to the hot trading and mining activities, the project was extremely hot. After the launch of dYdX, there may be a risk that the project data is not as expected (for example, if the price of dYdX currency is adjusted, the transaction and mining heat will be adversely affected). 3) Risk of dYdX token value capture capability: the attribution of transaction costs is not determined, and there may be a risk that the agreement cannot capture transaction costs. 4) Quasi-centralization risk: dYdX's operation is partial centralization, and there may be related similar centralization risk in operation. First, market-makers mainly center makes market makers, and many investors market-makers is project, in the process of market, if marketmakers cannot return flow pool pledge loan, can lead to liquidity pledge (LP) loss, and has the potential to manipulate the market price, such as fixed-point broke in the centralized exchange common risk of marketmakers evildoers. Secondly, at present, dYdX token allocation is centrally determined by the project side to determine which are "cleaning transactions" and cancel the transaction mining reward, which may lead to the loss of mining costs for traders. As such, there may be other unexposed risks of class centralization.

1) dYdX itself is the track leader, gathering the expectations of the whole track and voting by capital from multiple leading investors. The project itself has strong expectations; 2) The amount of financing reached 87 million USD, and the average token cost (DYDX acquisition cost) was about 0.3 USD, and it needed to be released linearly 18 months after the token was launched. A large number of users went to brush transaction to obtain DYDX token, and the "brush" mining cost was only 2.26 USD (calculated according to the total cost). The acquisition cost is not high, and it can be claimed and traded on September 8, which is a kind of IXO-like "INITIAL coin offering" activity -- this is the essence of the dYdX deal mining round, where the initial coin is acquired by entering the market and paying fees before the official launch of dYdX. The average price of $2.26 paid by the market is similar to an auction price, reflecting the expectation of "investors" on DYDX price under certain risk. As the token goes online, DYDX moves from the illiquid primary market to the highly liquid secondary market. Trading mining "investors" expect they will receive a liquidity premium.