Derivatives decentralized exchange dYdX to open its own chain on Cosmos

dYdX Public Testnet

dYdX, a decentralized derivatives exchange, announced on the 28th that it will open a public test version of its self-developed blockchain on July 6, 2023 at 2:00 (Japan time).

In the public test version, more than 40 validators (authorizers) will be secured to verify transactions on the network. This move marks the fourth of five milestones in dYdX’s “v4” decentralization plan. The fifth milestone of mainnet operation is expected to be completed by the end of September 2023.

The public test version of dYdX will initially only have trading markets for Bitcoin (BTC) and Ethereum (ETH). In total, the company plans to create about 30 new markets as it upgrades.

In the test version, users will receive a simulated currency that cannot be transferred outside, allowing them to experience operating functions such as connecting wallets, viewing order books, placing market orders, and checking account balances.

dydx decentralization plan

In June 2022, dYdX announced plans to build its own blockchain “dYdX Chain” using the Cosmos SDK as part of its plans to go fully decentralized.

The conventional dYdX runs on StarkEx, developed by Starkware, and functions as the second layer (L2) scalability engine for Ethereum. According to dYdX, the trading platform is capable of processing 500 orders per second on StarkEx.

However, by creating a dedicated dYdX v4 blockchain (app chain), the processing power of the system can be increased 100 times.

Furthermore, in the existing dYdX, a single organization is responsible for the order matching function off-chain, which makes the server etc. a partly centralized structure. However, in the new plan “v4”, we plan to promote decentralization by having validators take charge of these functions, and change the format so that transaction results are recorded on the chain for each block.

Along with this, the transaction fee currently received by the management side may be distributed to the participants for staking (investment with the security deposit as collateral) to the validator in “v4”.

When the new version “v4” is released, a governance forum will be set up, and proposals, including the treatment of staking rewards and the addition of new markets, will be managed by the entire community. The dYdX development team has said it will not control the governance process on the forum.

A dYdX blog post titled “Why Decentralization Matters” argues that the process of removing middlemen – decentralization – is blockchain’s most powerful and unique feature. In order to realize dYdX’s mission of “democratizing access to financial opportunities,” he argues that decentralization is essential, and that it is essential for the health of the cryptocurrency ecosystem. are doing.

connection:Derivatives decentralized exchange dYdX to build its own chain on Cosmos

The post Derivatives decentralized exchange dYdX to open its own chain on Cosmos appeared first on Our Bitcoin News.