dYdX Tops Uniswap as Largest DEX by Volume

Decentralized exchange dYdX, which recently migrated from Ethereum to Cosmos, has topped one of Uniswap’s markets to become the largest DEX by daily trading volume, according to data from CoinMarketCap.

The Cosmos-based v4 version of dYdX just saw $757 million of volume over a 24-hour period, topping Uniswap v3, which had $608 million, the data shows. dYdX’s v3 market, which still operates, had $567 million, enough for third place.

According to dYdX, the total trade volume so far for its v4 market since launch is $17.8 billion. In 2023, dYdX’s v3 saw a total of over $1 trillion in trading volume with several days exceeding $2 billion of trading volume.

There were concerns when dYdXY departed Ethereum that it might struggle to recoup the same level of activity that it experienced in previous iterations because Ethereum, while a more expensive chain, has significantly higher usage than the Cosmos ecosystem. dYdX’s high trading volumes, which now surpass that of Uniswap and other Ethereum-based exchanges (including dYdX’s own v3 DEX), might serve as a kind of validation of the company’s decision to switch ecosystems.

dYdX focuses on facilitating the trading of perpetual futures, which are contracts with no expiration date, thus allowing investors to speculate on the price of an underlying asset while bypassing the physical settlement of goods involved in standard futures trading.

The platform recently transitioned to v4, which it coined as a “fully decentralized” chain, unlike its previous v3 chain, which the company said was not. dYdX said v3 on Ethereum will eventually be closed, but no firm date is set for the closure.

According to Pantera Capital’s Paul Veradittakit, decentralized finance (DeFi) users seek platforms that offer “high throughput for rapid, continuous trading.” Veradittakit added that “high gas fees further compound the issue, diminishing user profits and platform appeal.”

Veradittakit said that dYdX v4’s transition to a standalone blockchain using the Cosmos SDK addresses challenges head-on by “promising significantly improved trading throughput, reduced transaction costs and customized on-chain logic tailored to sophisticated and high-frequency trading needs.”

dYdX is backed by the likes of Patnera, Paradigm and Delphi Digital.

Sam Kessler contributed to reporting.