What is Dydx? dYdX is a layer 2protocol, and layer 2 is a secondary framework or protocol built on top of an existing blockchain system. The main purpose of such protocols is to increase the transaction speed of major cryptocurrency networks and make a blockchain more efficient. DYDX is the governance token of the platform that gives the dYdX community full control of the system. DYDX allows traders, liquidity providers, and dYdX partners to collaborate on the dYdX layer 2 protocol. DYDX creates an ecosystem around governance, rewards, and staking, all of which accelerates the growth and decentralization of dYdX, ultimately providing a better user experience.
The user interface is friendly because the dYdX platform offers various features:
Additionally, the platform has a concept called periods. Periods are 28-day periods that govern all rewards and staking contracts. When the current period ends, a new period automatically begins. Trading rewards are distributed at the end of each period. Approximately seven days after the period ends, users can claim their rewards. As the platform’s whitepaper states, every successful exchange relies heavily on liquidity. Liquidity provider rewards are also distributed at the end of periods. Apart from this, 7.5% of the initial token supply is reserved to be distributed to any past users of the dYdX protocol who have completed certain trading milestones on the platform.
Another important part of the platform is the community treasury. The community treasury holds 5% of the initial token supply. The treasury’s goals are to fund programs and initiatives that will move dYdX forward, and to create funding programs to support community NFTs, hackathons, analytics dashboards, memes, translations, and other initiatives. The treasury is also used to create a governance framework and encourage strong governance. How to earn dydx? Users can stake USDC and DYDX to earn staking rewards. DYDX is awarded to users who stake USDC in the liquidity staking pool to promote liquidity network effects and incentivize professional liquidity providers. Liquidity providers approved by the community use the staked USDC to create markets on dYdX. This further increases the liquidity available in the markets. DYDX payouts are issued in real-time based on each staker’s share of the total USDC in the pool. Staking pools are a way to increase the liquidity and security of the protocol. What is the History of Dydx? The dYdX Foundation is a non-profit organization headquartered in Zug, Switzerland. The dYdX Foundation supports and grows every aspect of the current implementation of the dYdX protocol and all future implementations, technical or otherwise. Additionally, Arthur Cheong, Rebecca Rettig, and Markus Spillman are members of the dYdX Foundation’s Council.$DYDX
