On this article we discover GMX, a decentralized perpetual buying and selling DEX that permits you to leverage as much as 50X on varied cryptos resembling BTC, ETH, and lots of different altcoins.
In a short while, the platform has managed to turn out to be very well-known within the DeFi world, due to its fascinating options that assist you to function within the encrypted markets in a quite simple and environment friendly approach.
Right now GMX boasts a TVL of 500 million {dollars} and a cumulative quantity of 200 billion {dollars} since its inception.
Let’s see all the main points beneath.
GMX: the preferred decentralized perpetual crypto buying and selling DEX on this planet of DeFi
GMX is a decentralized DEX that enables spot and perpetual buying and selling with as much as 50x leverage on a variety of cryptocurrencies resembling BTC, ETH, SOL, DOGE, LINK, BNB, ARB, AVAX, NEAR, and lots of extra.
Right here customers can trade on-chain belongings just by connecting their non-custodial wallets, or they’ll act as liquidity suppliers by locking collateral for trades and incomes buying and selling charges.
Initially born from nameless founders beneath the title Gambit Finance and launched on the BNB Chain, it was then renamed GMX and launched on the layer-2 of Ethereum Arbitrum in September 2021.
Right now it has additionally expanded to Avalanche and has turn out to be extraordinarily common in DeFi, particularly amongst these customers on the lookout for an environment friendly and high-performance decentralized platform.
The numbers communicate for themselves: as of Could 6, 2024 GMX has a quantity within the final 7 days of 1.25 billion {dollars}, a cumulative quantity of 199 billion {dollars}, a TVL of 436 million {dollars} and cumulative charges collected of 308 million {dollars}
From a technical standpoint, GMX has launched a brand new approach of conceiving decentralized buying and selling on DEX.
To begin with, fairly than choosing the traditional structure of DEX with twin token swimming pools, GMX makes use of a single liquidity pool composed of fifty% stablecoins (USDC, USDT, DAI, FRAX) and the remaining 50% of varied tokens resembling ETH and BTC.
All customers who commerce on the platform draw from this pool of cryptographic sources, inside which the worth of particular person cash is secured by the value feed of Chainlink oracles, which ensures accuracy and reliability of the info.
The sort of multi-asset pool is community-owned and is alternatively known as GLP: LP suppliers, by locking their cash on GMX, obtain a corresponding quantity of the GLP token representing their share of the offered liquidity.
Subsequently, the protocol mechanically stakes the newly minted GLP tokens.
It’s price noting that those that present liquidity to the decentralized buying and selling DEX obtain 70% of the buying and selling charges within the type of esGMX tokens (a useful resource that ensures the identical rewards as GMX) and ETH or AVAX relying on the community, whereas the remaining 30% is obtainable to the platform’s stakers.
It is rather essential to underline how simplicity, intuitiveness, and immediacy of operations have been successful options for GMX, permitting the protocol for use by your entire DeFi group, even amongst much less skilled customers. As well as, merchants profit from zero value influence and really low buying and selling charges in comparison with the trade common.
GMX crypto: on-chain evaluation
The newly launched decentralized buying and selling DEX additionally encompasses a governance crypto, which bears the identical title because the platform, particularly GMX.
Token holders of GMX can take part in discussions relating to mission developments by voting on governance proposals by way of their share of affect.
On the identical time, nevertheless, crypto may also be locked in stake to reap the benefits of excessive yields. Specifically, GMX stakers obtain three varieties of rewards: multiplier factors (factors that reward long-term holders), GMX deposited as collateral, and rewards in ETH or AVAX relying on the originating chain.
The multiplier factors, obtained at an APR of 100% in comparison with the quantity deposited, then assist you to earn extra commissions.
Nevertheless, in the meanwhile, on the value entrance, the GMX token shouldn’t be crusing in good waters as it’s being traded with a drawdown of about 70% in comparison with the highs of April 2023.
Within the final 10 weekly candles on the GMX-USDT buying and selling pair, we will observe how 9 of those are bearish whereas just one hints at a timid inexperienced.
The weak point of the GMX token; after going by way of a bear market impeccably managing to face out from all different cryptos, can also be primarily because of the entry into the market of decentralized perpetual DEX competitor Hyperliquid.
This newest platform, pushed by the pattern of a doable airdrop of a proprietary token, has grown considerably in current months, managing to seize a part of GMX’s market share.
Simply assume that at the start of the yr GMX had a market share of about 18% whereas on the finish of April it recorded solely a share of three.5%.
It must also be famous that among the historic traders within the GMX mission and token have not too long ago dumped all their “baggage”, liquidating their holdings within the cryptocurrency.
Specifically, we spotlight how Arthur Hayes, a well known crypto billionaire and founding father of BitMEx, till a number of months in the past held tens of tens of millions of {dollars} in GMX whereas at the start of April he offered all of the tokens he owned.
Roughly 237,674 GMX have been offered since April eighth. This has undoubtedly had a detrimental influence on the asset’s value motion.
