On July 6th, the leading decentralized cryptocurrency exchange dYdX officially launched the public testnet of its highly anticipated “v4” version.
dYdX is built on the Ethereum blockchain and utilizes StarkEx technology. As the exchange does not hold user funds, it is often referred to as a decentralized exchange (DEX).
However, dYdX does have a centralized order book and matching engine that allows market makers to place limit orders. This sets it apart from automated market maker (AMM) DEXs like Uniswap, which use on-chain pricing algorithms to match buyers and sellers.
Some of the features in the testnet version include wallet integration, order book viewing, market order placement, and account information viewing. Initially, the testnet will only support the Bitcoin and Ethereum markets, but dYdX plans to add an additional 30 markets through network upgrades in the future.
In June 2022, dYdX announced its plan to “move house” from Ethereum to its own blockchain built on Cosmos technology. This new blockchain is called DYDX Chain. Currently, the platform has completed several milestones and has over 40 validators running for DYDX Chain.
They believe that both Layer 1 and Layer 2 solutions of Ethereum cannot meet the requirements for transaction speed. This has driven their determination to build DYDX Chain as an alternative solution.