dYdX to Sunset v3 Product, Focus on dYdX Chain Development

Rongchai Wang Sep 28, 2024 06:37 dYdX Trading Inc. announces the sunset of its v3 product to focus on the development of dYdX Chain software

Decentralized derivatives exchange dYdX is sunsetting its v3 product to focus on the development of its dYdX Chain software.

The move, announced by dYdX on Wednesday, will see the platform shift its attention away from the L2 decentralized appchain, which launched in 2021, and towards the dYdX Chain, which launched in 2023.

dYdX Trading Inc. has announced the sunset of its v3 product to concentrate efforts on the development of the dYdX Chain (v4), according to dYdX. This strategic shift aims to enhance the platform's capabilities and solidify its position within the decentralized finance (DeFi) ecosystem.

Since its inception in 2017, dYdX Trading Inc. has been a pioneer in perpetual markets trading. The v3 product has facilitated over $1 trillion in trading volume and served as an influential model in the Ethereum space. The release of dYdX Chain in 2023 marked a significant advancement, introducing a fully open-source, performant, and decentralized appchain. This new infrastructure enables unlimited market listings, faster transaction times, and true decentralization.

With over $220 billion in trading volume on the dYdX Chain already, the platform is preparing for its next major launch: dYdX Unlimited, set to debut this fall. To focus on this new development, dYdX Trading will sunset the v3 product, redirecting all resources to the dYdX Chain.

This transition will affect users of the dYdX v3 platform. From now until October 28, 2024, trading on the platform will continue as usual. However, users are encouraged to wind down positions and withdraw their USDC from dYdX v3. All trading, oracle-price updates, and funding payments will halt on October 28 at 12:05 P.M. UTC. Subsequently, on October 30, the Ethereum smart contract will mark the L2 exchange as “frozen,” halting any further balance updates and allowing users to withdraw their USDC, including the value of open positions based on oracle prices at the time of trading cessation.

dYdX Trading emphasizes that it does not and will never custody user funds. All account states and funds are stored on the Ethereum smart contract, ensuring users can withdraw their USDC independently of dYdX Trading or any other party. The company plans to maintain read-only historical data via API for at least one year following the shutdown date.

The shift towards focusing on the dYdX Chain is seen as a step forward in strengthening the platform’s position as a leading DeFi trading platform. The upcoming launch of dYdX Unlimited promises to deliver a world-class trading experience, unparalleled in the web3 space.

For users eager to start trading on the dYdX Chain, resources and guides are available, and updates will continue to be shared through the dYdX blog, Twitter, and Discord channels.

Does this affect dYdX Chain (v4)?

There will be no impact on dYdX Chain.

What does this mean for the token?

The decision to wind down v3 does not directly affect the functionality of any governance token. More information can be found on the dYdX Foundation website.

What will happen to my open positions on dYdX v3?

Open positions will be settled for their USDC value based on current oracle prices, and the corresponding USDC amount will be available for withdrawal from the Ethereum smart contract.

What actions do v3 users need to take?

Users are encouraged to plan for winding down positions and withdrawing their USDC from the dYdX v3 smart contract. USDC held on the smart contract will remain available for withdrawal indefinitely, supported by L2Beat, an independent third party.

Can dYdX Trading unilaterally shut down dYdX v3?

dYdX Trading is winding down its activities related to dYdX v3, but certain functionalities will remain. The v3 smart contracts are governed by governance and cannot be unilaterally modified by dYdX Trading or any other party.

What support is being sunsetted?

dYdX Trading will cease processing certain trade information for v3, effectively ending trading activity on the platform.