The decentralized trading platform dYdX is looking to up its game when it comes to decentralized governance. A post from Australian-based Fox Labs Digital suggested that the platform should consider dividing oversight responsibilities among several smaller decentralized autonomous organizations (DAOs). This comes as dYdX is preparing to upgrade the Cosmos blockchain to its fourth version (v4). The main goal is to make their platform “fully decentralized” according to a blog post.
Expanding SubDAO for Inclusivity
With the launch of v4 and the expiration of its operations subDAO, the dYdX community is approaching a crucial stage that will determine the future of the platform. Fox Labs stated: “This is not just about shaping the future of dYdX but also about building a model for how a decentralized trading platform can operate effectively and inclusively.”
dYdX utilizes subDAOs to define core functions and be accountable to its community. Currently, there are two subDAOs for grants and operational activities. The platform aims to diversify further for greater inclusivity and openness.
Scaling Amidst Complexities and Education Challenges
The move to Cosmos follows significant growth in order processing on dYdX. With over $341.5 million in total assets locked (TVL) according to DeFi Llama, the platform had to find a scalable solution to keep up with the demand. Additionally, the complexities of self-custody make it hard to educate users on the importance of these protocols. Vice President of the dYdX Foundation David Gogel stated “There’s still a lot of work to do to educate them. It’s a complicated journey.”
Centralized exchanges still account for the majority of trades when compared to DEXs. Uniswap had processed more than $642 million in orders through the past day; Binance had dealt with more than $4.28 billion over the same period. Despite the collapse of the FTX exchange last November, the DEXs didn’t benefit as much as expected.
Besides decentralized spot trading, dYdX also offers its users the option of margin trading. Furthermore, the team at dYdX is currently exploring the renewal of its dYdX grants program to help support the growth and development of the broader DeFi community and projects. The dYdX community has had a generally positive response to the program with most criticisms being that it lacks transparency and accountability.
Paving the Way for Decentralization and Growth
In sum, dYdX’s exploration of subDAOs signifies a significant step toward full decentralization. dYdX’s pioneering efforts in DEXs have the potential to foster inclusivity, and diversity, and accelerate ecosystem growth. With the growing adoption of subDAOs, the crypto industry enters a new era of distribution, efficiency, and scalability.
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