An Evolution of Decentralized Finance Derivatives Exchange-DIPX
DIPX- A TRUE DECENTRALIZED INDEX PERPETUAL EXCHANGE
The cryptocurrency markets have experienced a challenging and painful year in 2022. Terra Luna’s ecosystem collapsed in May. The Ethereum blockchain had the long-awaited upgrade in September. The bankruptcy of several exchanges came one by one, such as Celsius, Voyager, and FTX in November. Cryptocurrency coin and token prices have struggled all year.
Even in the overall volatility of the environment, GMX had achieved $85 billion in annual transaction volume, $115 million in annual fee revenue, and 200,000 new annual users in 2022.
DIPX, which looks like GMX, is a decentralized exchange, but a totally new evolution in the field of Web3 Derivative.
A derivative is a contract in traditional finance that gets its value by tracking how well an underlying asset performs. So, this allows investors to hold or trade these assets without really owning them. In addition, the underlying “assets” could constitute an asset, a group of assets, a stock, a commodity, market indexes, currencies, interest rates, bonds, or even another derivative.
However, Defi derivatives are essentially blockchain-based derivatives contracts that employ smart contracts to automate the conditions of contracts. So, this eliminates the reliance on brokers. And, when the contract conditions are met, settlement occurs automatically on-chain.
DIPX (DECENTRALIZED INDEX PERPETUAL EXCHANGE) is an oracle-based decentralized on-chain derivatives index future perpetual trading exchange platform, living on Optimism and Polygon, where you can trade BTC and ETH price indices by any other crypto asset, directly from your wallet with up to 100x leverage and infinite liquidity at dipx.io.
DIPX combines the experience of financial derivative instruments and the benefit of a decentralized credit risk-free solution.
Besides index trading, you also can provide liquidity with stablecoins like USDC, USDT, and any other crypto asset, to earn real yield from market-making and leverage trading.
What is Index Trading?
Index trading is defined as the buying and selling of a specific market index. Traders will speculate on the price of an index rising or falling which then determines whether they will be buying (going long) or selling(going short) any assets they want to trade. Here on DIPX, BTC and ETH Price Indexes are offered to be traded, and other Indexes will be expanded soon. On DIPX, any crypto asset is accepted as an eligible margin to trade in any Index.
What is Perpetual Futures Trading?
Futures allow traders to get exposure to a market without owning the underlying asset. In a traditional Futures market, the delivery of underlying assets and Futures contracts are settled on a predetermined future date, instead of directly trading assets (as in a spot market). Trading Futures allows one to profit from both the up and downside of an asset. Futures allow for the use of leverage too.
Perpetual Futures contracts allow traders to speculate on the future price of a given asset by buying (going long) or selling (going short) perpetual futures contracts. Unlike typical futures, perpetual Futures do not expire and remain effective until the trader closes their position. Crypto assets trade 24/7, and so do Decentralized Perpetual Futures.
“You will never make money outside of your cognition.” All traders should strategize and do their research before trading Index Futures and understand both their advantages as well as their risks. Trading Index Futures can result in significant financial loss, keep this in mind at all times: Never invest more than you can afford to lose!
How does DIPX works?
DIPX platform consists of 3 components: Liquidity pools, Index Futures trading systems, and Decentralized Ρrice Indexes Data(combined from Chainlink and Uniswap). Therefore, there are 2 kinds of participators: Liquidity providers and Traders, besides the project token holders.
Both Traders and Liquidity Providers inject crypto assets(BTC, ETH, USDC, USDT, DAI, FRAX, and any other cryptocurrency) into the liquidity pools, before the DIPX protocol mints DLP tokens to Traders and liquidity Providers.
Based on the pooled liquidity, the Liquidity Pool acts as the central counterparty and clearinghouse to all positions settled by Traders.
Traders will trade in the price indexes (such as BTC, ETH Price Index) by DLP tokens to make a ΡnL from the volatility in the price indexes space, while Liquidity Providers can earn real yield from market-making and leverage trading.
DIPX Trading Screenshot
In this case, both Traders and liquidity Providers will bear the PnL of all open positions (long and short) across the platform (Platform Entire ΡnL) equally by minting or burning DLP tokens, in other words, the traders not only make their own PnL but also take some of Platform Entire PnL at the same time.
DIPX Trading Sysytem
What’re DIPX’s Advantages?
Based on objective price Indexes oracles and liquidity Pools, DIPX aims to deliver the best trading experience for traders with zero credit risk and minimize impermanent loss for liquidity providers. Here are the DIPX advantages as follows.
- Zero Credit Risk.In Code We Trust.Open source and All trades 100% on the chain with full decentralization and permissionless, trustless, transparency.
- Zero Market-to -Market risk. All assets can be traded directly on DIPX, therefore, Liquidity providers(DLP-XXX) of the Isolated Pools earn real yield from market-making and leverage trading without mark-to-market risk(without harmful token price volatility).
- Zero Slippage and Low Cost. Trade with no slippy, zero impermanent loss on any market, and low trading fee. What’s more, Transaction costs on Optimism Layer 2 are one-tenth of Ethereum L1. Deposit or withdraw assets freely from the Isolated Liquidity Pool.
- No Assets Staking. DIPX does not have custody of your assets. All assets come directly to the pool as LP or to trade Price Index Futures for PnL. All users have full ownership and control of their assets through their own wallets. Your assets stay with you and the margins posted are locked in a dedicated smart contract, which reduces the risk of liquidations from temporary wicks.
- No Assets Limitations. DIPX Supports any crypto asset. All crypto assets can be traded on DIPX without permission from the platform.
- Infinite Liquidity. Derivatives trading with Infinite Liquidity.
- High Leverage Perpetual Trading. You can trade BTC or ETH Price Index by BTC, ETH, USDC, USDT, DAI, FRAX, and any other cryptocurrency with up to 100x leverage directly from your wallet.
- Suitable Risk Appetites. For risk averter: To be liquidity providers to earn real yield from market-making and leverage trading with Low imbalanced market exposure risk; For speculators & Hedgers: To be traders to trade Index Futures for PnL with High risk and high volatility of returns.
- Blazing Fast. Near-instant trade confirmations using Optimism’s Layer 2 scalability and Polygon
- Mobile and Easy Ramping. Manage your trades at home or on the go with extremely simple procedures.
To get involved and stay updated on all DIPX-related matters:
