Leading decentralized cryptocurrency exchange dYdX has open-sourced the code for its new dYdX Chain, paving the way for a mainnet launch of the platform’s transition to a truly decentralized architecture.
In an X (formerly known as Twitter) post on October 23, the dYdX team announced the release of the open-source protocol, order book, front-end, and other core components underpinning the exchange’s Cosmos-based blockchain network.On September 6, dYdX had already made an announcement to launch decentralized order book exchange on Cosmos.
While dYdX is currently one of the largest non-custodial crypto trading platforms, with over $2.6 billion in daily volume, its reliance on a centralized order book has led some critics to question its decentralized status.
The open sourcing of the codebase represents a major milestone in dYdX’s mission to fully decentralize its order book and remove the dYdX development team’s control over the protocol.
The move hands over the reins to the community-governed dYdX Decentralized Autonomous Organization (dYdXDAO) to organize the mainnet launch and future governance.
Following the code release, the dYdXDAO SubDAO on Operations proposed a phased rollout for the mainnet, with an alpha testing period to allow staking followed by a beta launch enabling live trading and further testing before full decentralization. No official dates have been set for the launch phases.
The new dYdX Chain infrastructure runs on the Cosmos ecosystem, moving the exchange off its current Ethereum layer-2 StarkEx architecture. According to dYdX, the open-source design will enable DeFi enthusiasts worldwide to operate node infrastructure and participate in the DAO governance process.
Once mainnet activation is complete, the dYdX development team states they will no longer maintain any control over the protocol’s infrastructure or governance decisions. This hands-off approach is seen as an opportunity to create a truly permissionless and censorship-resistant decentralized exchange operated wholly by its community.
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