dYdX
dYdX is a decentralized exchange for perpetual futures on crypto assets, founded by Antonio Juliano in 2017. Since 2023 it has run on the dYdX Chain, its own blockchain built with the Cosmos SDK, where validators hold the order book in memory, match orders and settle the trades in each block.
Traders keep their collateral in their own wallet address on the chain and trade without an account at a company. The DYDX token secures the chain through staking, and stakers receive a share of the trading fees. The front end at dydx.xyz is not available to persons in the United States or Canada.
From Ethereum contracts to an app chain
The first versions of dYdX ran as smart contracts on Ethereum and later on a layer 2 network, where one company operated the matching engine. With version 4 the protocol moved to a chain of its own, so that matching, settlement and governance all happen on infrastructure that token holders control. The dYdX Foundation in Switzerland supports the protocol but does not run the exchange.
An app chain carries only one application, which lets the developers tune block times and fees for trading. In return the exchange has to bring its own validator set and bridge assets such as USDC from other chains before users can trade.
An order book run by validators
Most decentralized exchanges price trades against a liquidity pool. dYdX keeps a classic limit order book like a futures exchange, but each validator holds a copy of it in memory, so orders and cancellations do not cost gas. Only the matched trades go into the block and change the balances on the chain.
The model suits market makers who quote both sides of a market and update their prices many times per second, because placing and canceling an order costs them nothing on the chain.
Unlimited: permissionless markets and MegaVault
The upgrade called dYdX Unlimited went live in November 2024. It lets anyone list a new perpetual market as soon as an oracle price exists for the asset, without a governance vote, as The Defiant reported at the launch. The same upgrade added an affiliate program that pays a share of trading fees to traders who refer others.
Liquidity for the new markets comes from MegaVault, a pool into which users deposit USDC. The vault places the deposits with automated market-making strategies across many markets, and depositors share in the profit and loss of these strategies, which the dYdX Foundation describes in its own post.
Perpetual futures under EU rules
A perpetual future has no expiry date, and a funding rate paid between long and short positions keeps its price close to the spot price. In February 2026 ESMA said that it considers crypto perpetuals offered to retail clients in the EU to be contracts for difference, which brings leverage limits and negative balance protection to perpetual futures sold to these clients.
MiCA excludes services that are provided in a fully decentralized way without an intermediary, according to recital 22 of the regulation. Supervisors decide case by case whether a front end, a foundation or an affiliate program counts as such an intermediary.
Campaigns in Europe
The dYdX Foundation worked with the Luxembourg agency Hash Consulting for two years to reach traders in Europe. In the month of the Unlimited launch the agency coordinated more than 225 activations with KOLs and media partners, and over the whole engagement the partners published 886 pieces in several European languages.
Upcoming blockchain and digital asset events in Germany
What is the dYdX exchange?
The dYdX exchange is a decentralized trading venue for perpetual futures on crypto assets, with a limit order book that the validators of the dYdX Chain maintain. Users trade from their own wallet, and according to dydx.xyz the protocol has handled more than 1.6 trillion dollars in trading volume since its start.
Trading fees
Fees on dYdX depend on the trading volume of the last 30 days, and makers who add orders to the book pay less than takers who fill them. The fees go to the stakers of the chain, and the network itself charges no gas for placing or canceling orders.
The token, staking and governance
DYDX holders stake their tokens with validators, which secures the chain and earns a share of the trading fees paid in USDC. Stakers also vote on governance proposals, for example on fee levels, on the distribution of the community treasury and on software upgrades of the chain.
The dYdX Chain
The dYdX Chain is a proof of stake blockchain built with the Cosmos SDK and CometBFT, and it connects to other Cosmos chains through the IBC protocol. Its block explorer shows the validators, the stake, the governance votes and every settled trade with its addresses.
API and trading bots
Professional traders connect through an indexer that streams order books, trades and account data, and they sign orders with the keys of their own address. Open source clients in several programming languages let a trading firm connect its existing strategies without a custodian in between.
dYdX and Finance Loop
Finance Loop covers decentralized derivatives in the Investment & Digital Assets track, where listed futures meet DeFi, and in Risk & Compliance, where the CFD rules of ESMA apply. Finance Loop works with DeFiAM Labs and the Multichain Asset Managers Association on DeFi for regulated firms.
Finance Loop is a professional network and has the goal of driving the institutional use of emerging technologies in finance, such as AI, tokenization, stablecoins, and DeFi. Finance Loop helps its members build skills and personal networks in these fields: Investment & Digital Assets, Payments & Digital Money, Digital Infrastructure & Sovereignty, and Risk & Compliance.