dYdX Intends on Stopping Support for 0x Decentralized Exchange Markets


dydx, a non-custodial exchange based out of Ethereum blockchain which allows for derivatives and short selling may end its support for 0x protocol based markets. The main reason for the discontinuation of 0x is the success of ETH/Dai.

0x protocol is also a decentralized exchange protocol on the Ethereum's network, but it seems liquidity has been a growing problem and dydx believe ETH/DAI resolved the liquidity issue quite fast and because of that they might shift their focus only towards that.

Zhuoxun Yin, head of operations at dydx said that the 0x protocol based market would be discontinued after 0x transitions to the third version of its protocol. He said, “We’ve been able to build meaningful liquidity on our markets so far, quite quickly, ”

Matteo Leibowitz, a market researcher for block analyzed dydx and its progress over the last three quarters and noted that dydx registered a volume of $60 million in the second quarter of 2019 which rose to $70 million in the third quarter and the number is expected to grow even further in the last quarter.

Although 0x markets would be discontinued after its switches to version 3, the new update would bring in several infrastructural updates as well as a new version of its token ZRX.

Leibowitz also presented the new updates coming to the 0x protocol stating,

“in 0x v3, traders using the 0x protocol must pay a fee to market makers, distributed pro-rata according to ZRX staked, equal to the transaction gas fee. This updated model is intended to attract more market liquidity, with the explicit user fee offset by tighter spreads. However, dYdX is confident that it can attract liquidity without burdening users with additional fees.”

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