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RRUPDATES📍: dYdX Chain Implements Fee Distribution System to Empower Validators and Stakers ⛓️
DYdX Chain has revealed its decision to distribute all network fees directly to its validators and stakers, marking a significant shift for the decentralized derivatives platform.
The R Roundup
October 27, 2023
RRUPDATES📍: dYdX Chain Implements Fee Distribution System to Empower Validators and Stakers ⛓️
DYdX Chain has revealed its decision to distribute all network fees directly to its validators and stakers, marking a significant shift for the decentralized derivatives platform.
In this strategic move, all trading fees will be allocated to stakers in the USDC stablecoin, enhancing the platform's stability and attractiveness for investors. Additionally, DYdX Chain plans to expand the functionality of the DYDX token on its version 4 platform, creating new opportunities for the community.
The alpha mainnet of DYdX Chain officially went live at 1 p.m. EST yesterday, with validators initiating the genesis block. This milestone heralds a new era for the platform's decentralized infrastructure.
1/ It’s finally here 🎉
Today, we’re proud to present and fully open-source the completed dYdX Chain!
This is the next chapter for dYdX and we’re so excited that it’s here.
Let’s get into the details:
— dYdX (@dYdX)
Oct 24, 2023
In a recent update, the DYdX Foundation emphasized the expanded utility of the DYDX token within the version 4 ecosystem. Stressing its critical role in fortifying network security and governance, the Foundation revealed that the token would be staked to network validators.
Furthermore, all protocol fees, including USDC trading fees and DYDX-denominated gas fees, will be directed to these validators and stakers. Importantly, the security incentives for DYdX Chain will not rely on token inflation, differentiating it from other blockchain models. Instead, the system will be sustained through fees collected in USDC, which will be fairly distributed among validators and stakers.
To ensure equitable fee distribution, DYdX Chain has implemented the Cosmos x/distribution module. This mechanism guarantees a streamlined and efficient process, ensuring that fees are distributed evenly among validators and stakers.
Moreover, participation in the blockchain's governance system will require tokens to be staked, granting validators the corresponding voting power. Token owners retain the option to vote on proposals themselves, ensuring a democratic decision-making process within the community.
The activation of the DYdX alpha mainnet signifies the initial phase of transitioning to DYdX version 4 and its innovative, community-governed Layer 1 blockchain. Leveraging the robust Cosmos SDK and the CometBFT consensus algorithm, DYdX Chain stands at the forefront of blockchain technology, paving the way for a decentralized future. While the alpha stage primarily focuses on stress-testing the network and onboarding validators, the subsequent beta launch, contingent upon approval from a community governance vote, will usher in a new era of trading on the network.
As a reminder, this is not a trading signal or investment advice; it is an opinion, and each trader/investor should know and understand the risks of trading cryptocurrencies.
This should not be regarded as financial advice; feel free to familiarise yourself with our NFA disclaimer.
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