In an effort to decentralise the platform, cryptocurrency exchange dYdX said on Wednesday that it is creating an independent blockchain. The DYDX coin, which according to CoinMarketCap is now selling at roughly $1.50, will reside on the layer 1 blockchain.
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.
The chain, which will debut the dYdX platform’s fourth edition, will be developed within the Cosmos blockchain ecosystem, a network of interconnected blockchains that can easily exchange assets.
“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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