Crypto Exchange dYdX to Start a Standalone Blockchain
The layer 1 blockchain will be built in the Cosmos ecosystem.
Cryptocurrency exchange dYdX announced Wednesday that it is launching a standalone blockchain in a bid to decentralize the platform. The layer 1 blockchain will become the home of the DYDX token, which is currently trading at around $1.50, according to CoinMarketCap.
The chain, which will introduce the fourth version of the dYdX platform, will be built in the Cosmos blockchain ecosystem – a community of interconnected blockchains that can easily communicate and trade assets back and forth.
In a blog post announcing the update, dYdX noted that having a standalone chain on Cosmos would provide the platform with extra flexibility around fees and features.
“A major benefit of Cosmos is that the chain can be developed to suit the exact needs of the dYdX network. One application of this is that traders would not pay gas fees to trade, but rather pay fees based on trades executed similar to dYdX V3 and centralized exchanges. These fees would accrue to validators and their stakers,” the post read.
Compared with most decentralized exchanges, which use automated market makers (AMMs) and liquidity pools to fill orders, dYdX will continue to use a traditional order book model with the new version of its platform. DYdX has long maintained that order books, which directly match buyers to sellers, are better suited to handle institution-sized transactions.
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