What is dYdX (DYDX)?
dYdX is a Tier 2 decentralized trading platform built on Ethereum and supporting multiple financial products: perpetual trading, margin trading, leveraged trading, and spot trading.
In addition, the dYdX platform allows investors to earn interest on deposits.
Where do dYdX come from
The platform was created in 2017, but has been open to users since 2018.
The main advantage of dYdX over competitors is the possibility of margin trading. Thanks to this, the platform was able to attract a sufficient number of users and investors, who contributed to the further development of the trading platform.
Later, new functions were introduced on the platform and the list of trading instruments was expanded. This has led to a rapid growth in the popularity of the trading platform among users. In 2021, dYdX surpassed even the world's leading CeFi exchanges in terms of trade turnover.
How dYdX works
The dYdX platform is now split into two main tiers:
- Spot and margin trading at level 1 Ethereum.
- Trading in perpetual contracts at level 2 (co-developed by dYdX and Starkware).
Ethereum Level 1 Spot and Margin Trading is a trading platform powered by smart contracts on the Ethereum blockchain, allowing you to trade without any intermediary. It has the following products and features:
- Spot and margin trading (the choice of trading instruments is very limited).
- Lending without a minimum limit and a waiting period.
- Loans with a minimum collateral of 125%.
Perpetual trading works in the level 2 blockchain system. The system works separately from the previous dYdX protocol on Ethereum. Trades are processed off-chain and send proof of validity to the Ethereum chain, this is called ZK-Rollups (Zero Knowledge Rollups), a Starkware-based Ethereum Level 2 solution.
ZK-rollups has the following features:
- High speed of work.
- Maintaining a high level of security and decentralization, since data is stored on the Ethereum blockchain.
- Low gas and trading fees.
Starkware does not publish all information about transactions on the network, thus ensuring the privacy of traders.
The implementation of the 2nd level system together with Starkware allowed the dYdX platform to expand its functionality. New tools unique to DeFi are available to traders:
- Leverage up to 1:25.
- Off-chain cross-margin order book.
dYdX also supports portfolio management, so traders can track their trades, request trading rewards, and receive commission discounts based on their trading volume.
What makes dYdX unique
All of the above features make the dYdX platform unique. Previously, margin trading was fully available only on the CeFi exchanges. Some of them could provide traders with a trading leverage of up to 1: 100. For decentralized exchanges, margin trading was not available.
The dYdX platform was the first to implement DeFi-based margin trading. Initially, the maximum available leverage was 1: 5, but later on some instruments began to offer leverage up to 1:25.
Where to buy dYdX
In August 2021, the dYdX platform announced the creation of its own digital coin - DYDX. Given the popularity of the trading platform, the world's leading cryptocurrency exchanges quickly listed DYDX.
Therefore, it is very easy to buy dYdX now. You can buy a token on many centralized and decentralized exchanges.
Many users had the opportunity to receive the DYDX token for free. In August, the dYdX platform distributed a part of the tokens among users who performed at least one operation on the platform.
How to Buy dYdX (DYDX)
It is very easy to buy DYDX. You need to have a trading account with dYdX or another DeFi, CeFi exchange. In this case, you will be able to purchase DYDX with other cryptocurrencies, since most exchanges, unfortunately, do not directly work with fiat currencies.
If you are looking to buy or sell DYDX for short-term speculation, it is best to use the services of brokerage companies. In this case, you can easily fund your trading account with traditional currency and trade DYDX. You will not physically own the DYDX token as brokerage companies offer cryptocurrency CFDs, but you will be able to profit from DYDX fluctuations.
How to start investing in dYdX in Qatar?
Invest in dYdX in Qatar is no different from investing in other countries. Cryptocurrency exchanges and brokerage companies work with clients all over the world. Therefore, in order to buy dYdX in Qatar, you only need to have Internet access and free funds for investment.
Is it safe to invest in dYdX online?
Any investment always carries a certain amount of risk. This is always worth remembering.
The risks associated with invest in DYDX are the same as the risks of investing in other cryptocurrencies or classic trading instruments. Therefore, investors and traders can safely consider DYDX as a potential tool for work.
From the point of view of long-term investments, DYDX is interesting because it has very good growth potential. The dYdX platform is actively developing and in the future may become the largest cryptocurrency platform in the world. This will keep the demand for DYDX high, which will inevitably lead to an increase in its value.
From a trading point of view, DYDX is also a very interesting tool. Its volatility is lower than that of many cryptocurrencies. Therefore, traders can trade this instrument with less risk.
Is dYdX a good investment?
In terms of long-term investment, DYDX is indeed a good investment. The digital coin has very good growth potential. The reasons were described above.
It is important to find a good time to buy dYdX in the long term. Any asset is worth buying on a pullback. In the 4th quarter of 2021, the cryptocurrency market is in a correction phase. This is a good opportunity to find profitable buy dYdX levels.
Should traders invest in dYdX?
DYDX is a very interesting tool for both long-term investments and short-term speculations. Therefore, traders should take a close look at this tool.
Moreover, now DYDX is available for trading not only on cryptocurrency exchanges, but also on the trading platforms of brokerage companies in the form of CFDs.
Trading CFDs gives the trader an advantage, as he can make money not only on the growth of the asset value, but also on its decline.
This is especially true when the cryptocurrency market is in a bearish trend. In this situation, any purchases of an asset can lead to a loss of funds. When you work with CFDs, you can open sell trades. Working with a trend is always less risky. You get a significant trading advantage.
How to Buy dYdX right now?
There are two main ways to buy DYDX right now:
- buy DYDX on a cryptocurrency exchange (including dYdX).
- trade DYDX through a brokerage company (when trading CFDs, you can not only buy DYDX, but also sell).
Which of these methods to choose is up to you. The choice depends on the goals and capabilities and your individual preferences.
If you want to speculate on short-term changes in the DYDX rate, it is best to opt for a brokerage company. They have practically no minimum deposit requirements, they have demo accounts, there is the possibility of direct work with fiat currency and very convenient trading platforms.
If you want to invest in dYdX for the long term, then it is better to opt for a cryptocurrency exchange.
Not all cryptocurrency exchanges offer demo accounts to users. This is a big disadvantage, since beginners take time to get used to the trading platform, tools, and test a trading strategy.
Therefore, novice traders should take a closer look at brokerage companies that offer their clients the opportunity to open a demo account. The main thing is to make sure that there is dYdX in the list of traded instruments.
A demo account is the best place to start invest in dYdX in Qatar. You will be able to study this tool in detail. Test your trading strategy without risking losing real money.
You can also try trading other financial instruments on a demo account without risk. The advantage of brokerage companies is that they offer users not only cryptocurrency trading, but also classic currency pairs and a huge number of CFDs.
A real account is the choice of experienced traders and investors. Beginners should switch to a real account only after successfully completing trainings on a demo account.
To buy dYdX in Qatar, you need to open an account on a cryptocurrency exchange or brokerage company. The procedure for opening an account is different everywhere, but in general it does not take more than 5-10 minutes.
If you want to start trading DYDX quickly, it is best to open an account with a brokerage company. In this case, you can immediately replenish your account with fiat currency and start trading.
Most cryptocurrency exchanges do not work directly with fiat currencies. Therefore, to start, you need to purchase cryptocurrency on P2P exchangers or in another way in order to replenish your real account. Only then can you buy dYdX or another cryptocurrency.
It is also impossible to withdraw profit in fiat currency directly from the crypto exchange. It will be necessary to carry out an operation to exchange cryptocurrency for traditional money.
We wish you successful trading!