dYdX pioneered decentralized perpetual futures trading, offering leverage up to 20x with a full order book model. It represents a different approach from AMM-based DEXes.
Order Book Model
Unlike AMMs, dYdX uses traditional order books:
- Limit and market orders
- Professional trading interface
- Off-chain matching, on-chain settlement
- CEX-like experience with self-custody
Perpetual Futures
- Trade with up to 20x leverage
- No expiration dates (unlike futures)
- Funding rates keep price aligned with spot
- Long and short positions
dYdX Chain
Migrated to its own Cosmos appchain for full decentralization and scalability.
Key Takeaways
- Order books suit derivatives better than AMMs
- Perpetuals enable speculation with leverage
- Hybrid models combine off-chain speed with on-chain settlement
- App-specific chains enable custom optimization