DYdX Trading, the main developer of the decentralized derivatives exchange dYdX, has released the open source code for the upcoming version 4. The new version is based on the Cosmos SDK and lays the foundation for an independent blockchain tuned to support the decentralized exchange .
The software architecture for the upcoming dYdX Chain was made publicly available today. According to an official statement, the mainnet implementation is still pending, subject to a board vote led by the dYdX Foundation. This is expected to be completed by the end of this year.
If the proposal receives approval, all components of v4, from the order book to the matching engine, will become part of a decentralized, community-governed project on a standalone blockchain, secured by audited smart contracts.
Developed using StarkEx, an Ethereum Layer 2 scaling solution, dYdX is currently the largest decentralized derivatives trading platform with a daily trading volume of over $1 billion. The transition to a Cosmos-based blockchain was initially announced as part of the v4 update and software development is now complete.
The new chain aims to offer transparent and secure derivatives trading, managed solely by code and governed by the user community.
The plan to further decentralize the project
In addition to the blockchain transition, dYdX Trading plans to relinquish control over several components of the protocol and stop collecting trading fees. Governance and decision-making responsibilities will be fully transferred to the community of dYdX stakeholders and ecosystem participants.
“The dYdX Chain software release marks the complete decentralization of dYdX and is a major step in our mission to democratize access to financial opportunities. With the dYdX Chain, dYdX brings transparency and security to derivatives trading with an exchange governed solely by code and controlled by the users,” says Antonio Juliano, founder and CEO of dYdX Trading.
To limit potential disruptions during the transition, the existing dYdX exchange, version 3, will continue to function alongside v4 indefinitely.