mev-toolkit/MEV_and_trading/protocols/dydx.md

dydx

tl; dr

• founded in 2017, dydx is the most popular dex for trading perps and utilizes a central limit orderbook model (rather amm).
• the oracle price is an aggregate price calculated using on-chain price oracles. collateralization and liquidations on dydx are determined using the oracle prices of each asset.
• the index price is an aggregate price based on price data from multiple exchanges and is used to trigger stop orders.
• the mid-market price is determined by the orderbook as tge midpoint or average between the lowest ask (sell price) and the highest bid (buy price).
• funding rate is the fee paid between longs and shorts for each perpetual market. longs pay shorts if the funding rate is positive and vice versa.
• it on starkware's L2 (migrated from ethereum in 2021) and soon moving to their own standalone cosmos chain (dydx v4).

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