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Presenting you with insights into what the crypto community is buzzing about each week!
Bitcoin's price remained resilient in the past week, with only a short-lived breakdown to $26K. In the same period, there were a few outperforming altcoins, such as DYDX and SOL. Meanwhile, U.S. equities surged as the October CPI and PPI surprised to the downside.
Source: CME
U.S. CPI has risen less than expected, leading to speculation that the interest rate hike cycle may have come to an end. CME’s FedWatch Tool shows over 30% of investors anticipate the first rate cut for March 2024. Additionally, the market has been talking about a soft landing as GDP growth cooled more slowly than expected.
DYDX is the governance token for decentralized perpetual exchange dYdX, which adopts StarkEx technology. StarkEx is a STARK-powered scalability engine developed by StarkWare for crypto exchanges. dYdX announced its move from the Ethereum Layer 2 to a Layer 1 built atop the Cosmos ecosystem earlier this year.
DYDX has surged close to 50% in the past week as the Layer 1 network on Cosmos has entered the beta stage and announced USDC staking rewards for validators or stakers on the network. Nonetheless, the fundamental improvement to the DEX is still uncertain. Another critical driver for the token’s surge is its rising dominance among decentralized perpetual exchanges.
Source: Bybit (market share of trading volume on top decentralised perpectual exchanges DYDX (red), APEX (blue) and GMX (grey)
The above market share comparison for dYdX, GMX and APEX shows that dYdX’s market share has been rising with its stellar token price performance in the past two months. In comparison, its closest competitor, GMX’s native token GMX, has underperformed in the same period as the market share has shrunk.
Source: Token Unlocks
That said, investors should be aware of the upcoming major unlock, which will almost double circulating supply from 190M to 340M. It was also noticed that whales have transfered significant amount of DYDX tokens to centralized exchanges, which usually suggests mounting selling pressures on the native token. In addition, decentralized exchanges have lost ground to centralized exchanges in this TradFi-led bull market.
Note: DYDX refers to the token on Ethereum ecosystem. As DYDX is in the process of transfering to Cosmos, the migration has not yet officialy started. Join Bybit and trade DYDX here.