On March 20, Odaily anddYdXFoundation co-hosts AMA. In the past year, dYdX has built its own exclusive chain, and its transaction volume has reached a milestone of US$1 trillion. The transaction volume of dYdX Chain has exceeded US$70 billion so far, and it has launched a number of incentive plans.
To this end, Hisashi OKi, head of Asia of the dYdX Foundation, visited the Super Talk community and introduced the dYdX selection construction to the community on the topic of Building an exclusive application chain from Ethereum Layer 2 to Cosmos SDK, and how dYdX can achieve leapfrog growth in transaction volume The journey of the exclusive chain dYdX Chain brings dYdX’s new Alpha to the community.
The following is the transcript of the AMA, compiled by Odaily:
Odaily: First of all, Hisashi OKi, please introduce yourself?
Hisashi OKi：Hello everyone, I am Hisashi OKi, Head of Asia at the dYdX Foundation. I have nearly six years of experience in the crypto industry, first as Editor-in-Chief at Cointelegraph Japan and later as Head of PR at Kraken. Additionally, I assisted Ledger in entering the Japanese market.
Before getting involved in the crypto space, I worked as a news reporter for TV Tokyo, covering events such as Wall Street financial markets and the U.S. presidential election. Friends who want to know more about me can check out myLinkedIn。
Odaily: On July 14, 2023, dYdX’s total trading volume exceeded $1 trillion, reaching the 1 trillion trading volume milestone. How did dYdX achieve this milestone?
Hisashi OKi：dYdX’s v3 platform is built on the Ethereum network’s StarkEX, which set a record $1 trillion in trading volume. While there’s a lot of talk about second-layer solutions right now, it’s worth noting that dYdX already began leveraging these solutions three years ago to combat rising Ethereum transaction fees.
Our approach is characterized by speed and adaptability; we embrace change proactively rather than being possessed by fear. We don’t want to be driven by fear. This mentality of focusing on the best of the product has played a key role in reaching $1 trillion in cumulative trading volume. This mentality will also continue to drive dYdX forward as we transition from layer two to layer one, the “dYdX Chain,” an independent blockchain built specifically for dYdX.
To learn more about “dYdX’s total trading volume exceeds $1 trillion” you can readThis Blog。
Odaily：From the launch of dYdX V4 in October last year to now, the overall transaction volume has exceeded 70 billion US dollars. What are the driving forces behind it?
Hisashi OKi：First let me introduce what is dYdX Chain? In October 2023, we launched dYdX Chain, an independent blockchain built on the Cosmos SDK framework. Currently, our dYdX V4 frontend is powered bydYdX SUBDAO Operation。
The launch of dYdX Chain marks a major milestone achieved by all members of the dYdX ecosystem. It generated a lot of momentum and sparked a lot of discussion within the community. This transition transforms the DEX into a jointly owned entity, with no one individual or group holding ownership.
As CEO of dYdX FoundationCharles d'HaussyThat being said, this is a win for all those who are built for traders.
We also have two trading incentive programs and a unique DYDX staking program, which I will explain later. All of these factors combined contribute to the success of attracting significant trading volumes. Its a win for everyone.
To this end, Odaily provides you with the current relevant data of dYdX (data interception time is March 19):
Odaily: dYdX has entered the multi-chain ecosystem from the Ethereum ecosystem. From the current point of view, the returns brought by this move are amazing. What caused dYdX to take this step in the first place?
Hisashi OKi：dYdX Chain was created to achieve complete decentralization. dYdX is now a fully community-controlled and governed protocol.
Prior to the launch of dYdX Chain, dYdX was a hybrid DEX with both decentralized and centralized components. While users can manage their assets themselves using private wallets like Metamask, there are still companies like New York-based dYdX Trading operating matching engines that match buy and sell orders from traders.
It is impossible to have a decentralized order book on “StarkEX”, Ethereum’s second layer Starknet. And we don’t want to sacrifice performance for decentralization. While thinking about a chain that could balance decentralization and performance, we came up with the idea of creating our own sovereign chain using the Cosmos SDK. This is what we call dYdX Chain.
dYdX no longer needs to rely on a single entity to manage the order book by creating the dYdX Chain. This is because validators (called nodes) distributed around the world that support the dYdX Chain network can manage the order book by checking against each other. All validators hold transaction records and share them with each other, and when buy and sell orders match, they are recorded on-chain. This mechanism enables dYdX Chain to be fully decentralized.
Odaily: Comparing dYdX V3 and V4, in addition to catering to more user groups, what are the advantages of V4?
Hisashi OKi：All protocol fees are 100% distributed to dYdX Chain’s validators and stakers.
In version v4, 100% of all fees paid by traders when they execute orders (taker and maker fees) will be distributed to validators and stakers.
In v3, dYdX Trading once accounted for all fees, but these have now been redistributed to the community of validators and stakers. dYdX is now capable of generating $60 million to $100 million in annual revenue.
You canMintscan Check the distributed staking reward amount on .
Odaily：The success of V4 is inseparable from the contributions of dYdX Chain pledgers. For pledgers, how can you become a pledger of dYdX Chain and what are the specific benefits?
Hisashi OKi：To become a pledger, you first need to own a certain amount of DYDX tokens, such as purchasing them on the OKX centralized exchange, which can also be exchanged on Osmosis, or traded on dYdX, and can receive DYDX tokens as trading rewards. I will introduce this aspect in detail later.
Also, I recommend you to useKeplr, which is a Cosmos wallet and staked with validators. You can safely use Ledger because of its integration with KeplrDYDX staking。
As I said above, 100% of transaction fees will be distributed between stakers and validators. Transaction fees are paid in USDC, so stakers can obtain USDC by staking DYDX tokens to validators, and stakers do not have to worry too much about market fluctuations. The USDC received in each block can be claimed at any time through Keplr. Currently, the annualized return on DYDX staking is approximately 21.7%, depending on the fees generated by the DEX.
Odaily: On February 23, the second season of the dYdX Launch Incentive program ended, and the third season is currently underway. Can you tell us more about the Launch Incentive plan and the effectiveness of the activities in the past two seasons.
Hisashi OKi：The dYdX Incentive Program is a 6-month program managed by New York-based company Chaos Labs, using a $20 million budget approved by the dYdX DAO. Currently, we are in Season 3.
In Season 1, $5 million worth of DYDX tokens were allocated to 2,006 accounts.
In Season 2, which ended on February 22, $5 million worth of DYDX tokens were allocated to 2,091 accounts.
dYdX Chain’s $20M DYDX Launch Incentive Program allows you to earn “points” on your trades. The higher the points, the more DYDX tokens you will be allocated at the end of each quarter. Traders canPublic rankingCheck your spot on to ensure you get a part of the reward pool.
In Season 2, the performance-based Trade League was launched as a new initiative. Performance is measured by return on investment (ROI), and top performers each quarter will receiveReward poola part of.
Odaily: Liquid staking is about to be launched. Can you tell us about the mechanism of liquid staking and the demand scenario for stDYDX as the first liquid staking token?
Hisashi OKi：Liquid staking allows validators securing the dYdX Chain to convert staked DYDX into liquid staking tokens, known as LST.
While someone holding a Cosmos-based DYDX token may stake it to earn real returns, the same may want to continue using DYDX in DeFi or as gas fees. Liquid stakers can leverage their DYDX in DeFi and earn consistent returns.
Currently byStride、Quicksilveras well aspStakeThree protocols compete for dYdX Chain’s liquid staking potential.
Liquid staking on Ethereum has been a huge success. Liquid Staking DYDX proves that the application chain is fully functional and successful, and that liquid staking will also be robust and reliable on the application chain.
Odaily: dYdX chose to move from the second layer to the application chain and achieved great success. What other applications do you think can build their own application chain? Please give some relevant suggestions to the latecomers.
Hisashi OKi：dYdX Chain is an application-specific chain tailored for crypto derivatives trading. dYdX develops its product through several stages: from launching on the Ethereum mainnet, transitioning to the second layer, and finally launching its own chain. With over $1 billion in daily trading volume, dYdX has shown that its own chain is operating successfully.
Now, I wont say which applications are suitable for a specific chain, but I think they need to have the following conditions: a) already have a strong user base, b) have a clear chain-specific goal (eg: perpetual trading), c ) have a strong engineering team to develop the chain, and d) have sufficient capital to focus on the launch of the chain.
Odaily: On February 5, dYdX released its 2024 roadmap, stating that it will focus on three main areas: permission-free market, core transaction optimization, and user experience/onboarding upgrades. It can be seen from the key focus areas that it is to clear the barriers for large-scale adoption. Starting from dYdX, how can it help the encryption industry expand more users?
Hisashi OKi：dYdX is a trading platform that replicates the trading experience of CEXs such as Binance and OKX. In other words, it provides a trading experience with a fully decentralized architecture and provides a CEX-like user experience, thereby reflecting the advantages of DeFi.
Imagine a DEX that offers a trading experience similar to Binance and OKX, but with self-custody capabilities that allow users to manage funds independently without having to trust people in a centralized entity. Additionally, fees paid on the platform are redistributed to users by staking native tokens. Additionally, a permissionless market was introduced that continuously launches new markets without the need for approval from the CEX listing team.
Currently, the trading volume of all DEXs is very small, maybe even less than 10% of the overall crypto trading volume. But DEX is getting closer to CEX in terms of product quality and trading experience. During this bull market cycle, as the gap between CEX and DEX regarding trading experience continues to narrow, the relevance of DEX continues to increase.
