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dYdX User Base Grows 252% After Layer-2 Promotion

Posted by
Robert Hoogendoorn

Gas free trading pushes platform to top of the charts

Ethereum-based DeFi platform dYdX has seen tremendous growth over the past week, increasing its user base 252%. This growth was driven by a deposit bonus program to promote the use layer-2 in the DeFi sector.

In the past week dYdX had 5,160 users, who were responsible for $15,66 billion in volume. The user base and volume growth pushed dYdX to the top of the DappRadar DeFi Rankings. In the past 24 hours the dapp even reached the first spot with $2,1 billion in volume. These billions are trades, deposits and all other transactions on the platform combined.

Early April dYdX announced that the integration of their StarkWare-powered layer-2 solution had launched. Trading on the exchange can now happen without the need to pay for crazy gas fees. To be more precise, the layer-2 solution by dYdX and StarkWare is a form of zk-rollups. They built the technology to allow traders to trade cross-margined perpetuals. Thanks to the layer-2 solution there are no gas fees, lower trading fees and reduced minimum trade sizes.

Since its launch on the layer-2 solution, the platform has seen 70% growth. dYdX communicated $555 million in trading volume since its launch in four weeks ago, coming from more than 104,000 trades. All this trading activity comes from more than 7,000 users who have deposited cryptocurrencies onto the platform.

Search for scaling solutions

The popularity of the Ethereum blockchain and the hype surrounding DeFi and NFTs and congested the network. The result has been increased gas fees that aren’t ideal for normal trading activities. That’s why the DeFi sector is currently blossoming on alternative blockchains like Binance Smart Chain, and more recently Polygon.

However, dYdX remains on the Ethereum blockchain. The StarkWare layer-2 solution uses zk-rollups, which means that the DeFi platform still taps into the Ethereum blockchain. As a result its security is powered by Ethereum and not dependent on validators or other, more centralized, blockchain solutions.

In the past four months the DeFi sector has blossomed on Binance Smart Chain in particular, attracting 105,000 active wallets per day in Q1 2021. PancapeSwap attracts more than 282,000 active wallets per week according to the DappRadar Rankings, while Pancake Bunny, ApeSwap, Autofarm and Soteria also have tens of thousands of active wallets on a weekly basis. At the same time Uniswap still dominates on Ethereum with 261,000 wallets per week, and SushiSwap follows with 18,900.

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