- Isolated Markets, a feature of DYdX v5, let customers divide their collateral among many positions.
Next week, DYdX, a decentralized perpetuals exchange, is scheduled to finish rolling out its much awaited v5 upgrade.
A number of new features, including isolated markets, batch orders, liquidity vaults, and new pricing oracles, are included in dYdX’s v5 version, which was unveiled on June 7. On June 3, the dYdX community voted with 98.4% in favor of implementing the v5 update.
According to data from DefilLama, DYdX demands a total value locked (TVL) of slightly under $500 million, ranking it among the top 20 DeFi projects by TVL. With $544 million, the protocol is ranked second among perpetual DEXes, behind GMX.
After DYdX, with $412 million, comes Jupiter, and Hyperliquid, with $392 million.
According to the dYdX Foundation, the protocol’s numerous incarnations have produced more than $120 billion in cumulative trading volume in a blog post from April.
Fresh attributes
Among the most significant modifications brought about by v5 is the introduction of Isolated Markets. The number of markets that were available was previously restricted because every market on dYdX shared the same collateral pool.
Up to 800 new markets can be launched on the protocol thanks to isolated markets, which provide each market its own unique collateral pool.
Another important addition to the upgrade is Isolated Margin. Instead of having all positions cross-margined against a single pool of collateral, it enables traders to approach each market as an individual position with unique risk factors.
According to a statement from dYdX, traders have the option to manually modify collateral for a particular position and limit it to that position only. We think that by doing this, customers will be able to comprehend and modify their collateral management more naturally.
Price oracle integrations from Slinky and Raydium, a limit order book DEX based in Solana, are included in the upgrade. By utilizing dYdX’s validators, the Slinky integration will facilitate block-by-block price updates with reduced latency, while the Raydium oracle offers pricing information on all assets traded on the Raydium exchange.
Additionally, batch order cancellations are added in V5, enabling customers to cancel up to 100 short-term purchases at once.
In the upcoming weeks, the update will also introduce liquidity provider (LP) vaults that offer automated LP strategies.
Season 5 bonus points
The fifth season of user incentives for the project will probably coincide with the launch of DYdX v5. The campaign, which is subject to a governance vote, will provide traders access to $5 million in DYDX tokens and continue until mid-July 2024.
Additionally, a multiplier for DYDX stakers, increased points for front-end trading activity, and distinct trading reward allocations for major markets like BTC, ETH, and SOL will all be added during this season. A $100 deposit incentive will also be given to the first 500 new accounts that sign up for Season 5.
Switching from Ethereum to Cosmos
Antonio Juliano introduced dYdX, a decentralized exchange powered by Ethereum, in 2017.
For a number of years, DYdX was one of Ethereum’s top DeFi protocols. In April 2021, the project launched its v3 version and moved to a dedicated Layer 2 appchain.
Nevertheless, with the release of its fourth edition in November 2023, dYdX left the Ethereum ecosystem in order to launch an appchain based on Cosmos.
Over the course of four funding rounds, the project gathered funding from leading cryptocurrency investment firms, including Paradigm, Polychain, and Andreessen Horowitz.
Disclaimer : This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
