As DEX volume explodes, a new competitor enters the market for decentralized derivatives

DerivaDEX, a recently announced decentralized exchange for derivative contracts, unveiled its plans to launch this quarter. The project was incubated by Polychain Capital and recently raised $2.7 million from them along with Dragonfly Capital Partners, Coinbase Ventures, CMS Holdings, Three Arrows Capital, and others. DerivaDEX looks to distinguish itself by being decentralized from the start and will enable token holders to govern the network. There will also be a variety of opportunities to earn DDX tokens through testnet competitions and liquidity mining.

Why it matters

• Volumes on decentralized exchanges have surged in the last few weeks reaching all-time highs of half a billion in weekly volume. This demonstrates a growing demand for non-custodial trading, however, the derivative market is becoming increasingly saturated as projects such as dYdX and Futureswap offer decentralized perpetual swaps.

• Liquidity mining is all the rage since Compound first began theirs a few weeks ago. DerivaDEX plans to utilize similar incentive mechanisms but believes it will be “sane” compared to existing options.

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