Decentralized Crypto Exchange Launches Contest in Pursuit of True Alpha

Decentralized Crypto Exchange Launches Contest in Pursuit of True Alpha

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  • The idea is to take advantage of behind-closed-doors Telegram groups and display business prowess for all to see
  • The buy-in is worth $2,500 of the USDC stablecoin

Decentralized exchange dYdX Trading launched its first cryptocurrency protocol trading competition on Wednesday — aiming to pit an influencer against a trader with their money, literally, where their mouth is.

Competitors must purchase $2,500 of the USDC stablecoin, an amount they receive in return – along with any profits earned – after the event. There are also proprietary non-fungible tokens (NFTs) and cash prizes, denominated in stablecoins.

Founder and CEO of the decentralized exchange (DEX), Antonio Juliano, told Blockworks that many traders exaggerate their ability to derive alpha via Telegram and Twitter groups. But there isn’t necessarily a “good public way to objectively measure people’s performance”.

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Rankings for the most knowledgeable traders will be measured in both dollars gained and lost and percentage gains and declines. The latter is an attempt to weed out the whales that come in and store their large assets in safe games to earn an average return on a large amount of cryptocurrency.

The idea is for participants to test their mettle on a wide range of liquid cryptocurrencies, including DeFi digital assets.

The DEX also plans to host a series of Twitter spaces to educate the public on how top traders are “thinking about market moves,” as well as dig deeper into relevant macro topics.

The launch comes as crypto markets continue to falter, having lost trillions of dollars in market capitalization since their all-time highs, following the demise of Terra stablecoin UST and, more recently, the collapse of insolvent crypto lenders, including Celsius and Voyager.

An argument can be made, however, that traders – and especially those in retail – are more than ever hungry for access to reliable information.

Juliano’s team – which has added staff even as a number of top crypto firms have been forced to make significant cuts – has an iPhone app and is currently working on an Android sister product. The end goal is to make the experience of buying and selling digital assets on dYdX as seamless for traders as connecting to centralized exchanges such as Coinbase and executing a trade.

While DEXs have come a long way in terms of usability and accessibility, according to industry participants, in the murky and hard-to-understand world of DeFi (decentralized finance), there is still a lot of work to be done.

Despite the market slowdown, Juliano said he was optimistic that DeFi is here to stay.

“How does DeFi win?” he asked. “It’s about creating a product that people will actually want to use.”

The exchange also has its own DAO, with a native governance token dictating the daily functioning of the DAO (decentralized autonomous organization).

Overall, DEXs such as dYdX have noticeably reduced the trading volumes of centralized titans including Coinbase and Kraken. But, in Juliano’s mind, the “likeliest scenario is for the two to co-exist for some time.” And some DEXs have lower fees than centralized market makers – another potential benefit for traders.

The team is also working on the next iteration of its native protocol, an endeavor that is expected to take around six months to complete and which ideally would result in a completely decentralized platform, with enterprise largely taking precedence over community.


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  • Michael Bodley

    Chief Editor

    Michael Bodley is a New York-based editor for Blockworks, where he focuses on the intersection of Wall Street and digital assets. He previously worked for the institutional investor newsletter Hedge Fund Alert. His work has appeared in The Boston Globe, NBC News, The San Francisco Chronicle and The Washington Post. Contact Michael by email at [email protected]

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