dYdX Launches Layer-1 Blockchain with DYDX Tokens
dYdX, a decentralized cryptocurrency exchange, has announced the launch of its layer-1 blockchain. The new blockchain will operate using the native DYDX tokens. It will distribute all network fees to validators and stakers on the platform.
dYdX To Distribute Fees To Stakers And Validators
In addition to distributing fees to stakers and validators, the layer-1 blockchain will expand the capabilities of the DYDX token on the version 4 platform. The alpha mainnet became operational on October 26th, with validators successfully creating the genesis block.
The Proof-of-Stake blockchain was built using Cosmos’ software development kit (SDK) and uses CometBFt as its consensus protocol. Validators can stake their DYDX tokens to secure the blockchain and carry out governance operations. The dYdX Foundation emphasized the extended utility of the DYDX token in version 4.
DYDX Token Utility Expanded
dYdX founder Antonio Juliano stated that the launch of the dYdX Chain depended on Circle and Coinbase launching on Cosmos in time for the creation of its genesis block. The new blockchain is entirely open-source.
Before the launch of dYdX’s layer-1 chain, the original DYDX token operated on dYdX’s Ethereum layer-2 protocol. To facilitate the transition, dYdX’s community voted to adopt the DYDX token as the primary token of the dYdX Chain and expand its utility for staking, governance, and network security.
Fees Collected In USDC
The fee distribution mechanism on the dYdX Chain will be managed through Cosmosx/distribution model to ensure even distribution among validators and stakers. Tokens will need to be staked through the blockchain’s governance system, and validators will receive voting power for staked tokens.
DYDX Price Action
The current price of DYDX token is $2.37, with predictions of a slight drop to $2.20 by November 2nd. Technical indicators suggest a bullish sentiment, but the Fear & Greed Index is at 65, indicating overbought conditions. The Relative Strength Index for DYDX is over 72, further confirming its overbought status.
Hot Take: dYdX Launches Layer-1 Blockchain to Expand Token Utility
dYdX has successfully launched its layer-1 blockchain, introducing the native DYDX token and expanding its utility for staking, governance, and network security. With the distribution of fees to validators and stakers, the new blockchain aims to create an efficient system for fee allocation. The launch marks a significant milestone for dYdX as it transitions from Ethereum’s layer-2 protocol to its own layer-1 chain. The future beta launch will depend on a governance vote. While the DYDX token currently shows bullish sentiment, it faces potential price drops in the coming weeks according to technical indicators.
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