dYdX launches decentralized perpetual swaps for bitcoin
dYdX, a margin buying and selling platform for Etherum, introduced they’re launching a market for perpetual contracts providing as much as 10x leverage on bitcoin. The contracts will make the most of the same funding mechanism to centralized exchanges the place longs and shorts pay one another based mostly on current curiosity. A key distinction is that liquidations will happen on-chain fairly than via a centralized entity, a mechanism that has been plagued with points prior to now.
Why it issues
Popularized by BitMex, the “perp” has develop into essentially the most liquid market in all of crypto buying and selling billions of dollars day-after-day, nevertheless, there isn’t a approach to commerce this contract in a decentralized method. By automating this market via good contracts, it ought to develop into extra clear and reliable.
DeFi functions have largely centered round buying and selling or lending Ethereum and ERC-20 tokens whereas monetary functions utilizing bitcoin have remained on centralized exchanges. By providing a product geared in the direction of these trying for bitcoin publicity, dYdX may onboard a brand new set of customers into DeFi.