Here’s How Much DYDX Has Evolved Since its Launch
DYDX, the native token of the dYdX Chain, has evolved from a governance-only coin to a dynamic, multifaceted asset within six months of its launch.
According to a blog post by the dYdX Foundation, DYDX has become the powerhouse of the layer-1 blockchain, enabling decentralized governance and allowing users to stake their tokens for rewards.
A Timeline of DYDX’s Launch
DYDX was launched in October 2023 alongside the dYdX Chain. Before that, the dYdX Foundation had launched DYDX (now ethDYDX) in August 2021. ethDYDX serves as a governance token for the Ethereum-based layer-2 protocol dYdX v3.
In September 2023, the dYdX community voted to adopt DYDX as the native token of the dYdX Chain. To this effect, a wethDYDX smart contract was deployed to serve as a bridge for token holders to convert their ethDYDX to DYDX.
At the time of writing, more than 75% of all ethDYDX have been converted to DYDX and migrated to the dYdX Chain. With 25% left, the circulating supply of ethDYDX now sits at roughly 247 million.
Staking DYDX
dYdX Chain was designed with a staking reward mechanism that distributes 100% of the protocol’s fees, paid predominantly in Circle (USDC), to stakers.
“This mechanism not only incentivizes the provision of security but also opens up various practical use cases for Stakers. Specifically, they can reinvest their USDC staking rewards into crypto or other assets or use the USDC as collateral for trading on the dYdX Chain with just a few clicks,” said the dYdX Foundation.
More than 18,900 DYDX stakers are receiving rewards, with $20 million disbursed so far. Around 149 million DYDX, representing 14.9% of the total supply, are staked to active set validators on the dYdX Chain with an annual percentage yield of 18%.
The Journey So Far
Earlier this month, the dYdX community approved a proposal to liquid-stake 20 million DYDX to reduce the chance of malicious attacks, improve network security, and decentralize validator operations. Rewards from the liquid staking would auto-compound USDC, be automatically converted into DYDX, and then re-staked to generate additional yield.
The dYdX Chain now has over $120 billion in cumulative trading volume with increasing staked assets. Community members have also initiated 55 governance proposals, indicating active participation in the network’s decision-making process.
Meanwhile, DYDX has a total supply of 1 billion tokens, a circulating supply of 501 million DYDX, and a five-year token distribution schedule.
The post Here’s How Much DYDX Has Evolved Since its Launch appeared first on CryptoPotato.
Filed under: Bitcoin - @ April 28, 2024 8:10 pm