- DYDX launched its own layer 1 blockchain this week built on Cosmos, allowing faster and cheaper transactions compared to Ethereum while still being EVM compatible.
- DYDX’s token price has risen around 50% over the past week ahead of a major token unlock event happening on December 11th, when over 500 million DYDX tokens will become transferable.
- This token unlocks accounts for over 20% of DYDX’s total supply, so the markets are anticipating some volatility around the added circulating supply.
The decentralized exchange debuted its layer 1 blockchain based on Cosmos this week. DYDX‘s token has seen significant price appreciation ahead of a large token unlock coming up.
DYDX Blockchain Launch
Earlier this week, DYDX launched its own layer 1 blockchain. The Ethereum-based DEX migrated to a custom blockchain built using the Cosmos SDK. This allows DYDX to offer faster and cheaper transactions compared to Ethereum.
The new DYDX chain combines the security of proof-of-stake with the Ethereum Virtual Machine (EVM) compatibility. This enables direct bridges to Ethereum, allowing assets and applications to move between the two chains.
Price Impact of Token Unlock
DYDX’s token price has risen around 50% over the past week. This comes ahead of a major token unlock event happening on December 11th.
Around 77% of DYDX’s total supply is currently locked. On December 11th, over 500 million DYDX tokens will become transferable. This is over 20% of the total supply.
The token unlock has likely contributed to the recent price rise, as investors accumulate ahead of the added circulating supply. Following the unlock, some selling pressure is expected on DYDX.
Conclusion
The launch of its own layer 1 blockchain is a major milestone for the DYDX project. This will allow the decentralized exchange to scale while still benefiting from Ethereum’s security and liquidity.
The upcoming token unlock is noteworthy for DYDX holders. With over 20% of supply becoming transferable, the markets are anticipating some volatility around the event.
