Binance Derivatives Market Research Report: 6 Derivative DEX Worth Attention

Original author: Emperor Osmo

Original translation: luccy, BlockBeats

With the booming development of the cryptocurrency derivatives market, it is expected that the market revenue will grow from the current $960 million to $231.2 billion by 2030. Binance recently released a DeFi derivatives report, in-depth discussing how to seize the growth trend of derivatives. Below is the report analysis by cryptocurrency KOL Emperor Osmo on how to utilize this trend. Translated and compiled by BlockBeats.

Overview

According to Binance's data, the cryptocurrency derivatives market currently occupies 74.2% of the total trading volume. The monthly trading volume of cryptocurrency derivatives has reached $1.9 trillion, tripled in the past three years. During this period, the derivatives market has shown diversification and growth.

Although the market is highly diversified, perpetual contract trading accounts for 90% of the market trading volume. This is because in the decentralized environment, the modeling of perpetual decentralized trading platforms (Perp DEXs) is simpler than options. In addition, many perpetual decentralized trading platforms can provide a similar experience to centralized trading platforms (CEX).

Notable Protocols

The rising popularity of Layer 2 solutions (L2s) has enabled the derivatives market to expand more rapidly, with Arbitrum leading the way. Many protocols have gone live in the past year, making it challenging to track and understand them. Here are 6 notable protocols worth paying attention to.

dYdX

dYdX is the largest decentralized perpetual contract exchange platform operating with an order book. As of 2023, it accounts for 69% of the trading volume, reaching a total transaction value of $222.7 billion. They provide precise control for market makers, which plays a crucial role in expanding the range of product offerings.

dYdX aims to address some of the shortcomings faced by decentralized order books and matching engines. Their V.4 version attempts to change this situation by allowing transactions to be submitted on-chain and leveraging Cosmos SDK and Tendermint POS.

GMX

GMX is the largest protocol in the Arbitrum ecosystem and the first project to launch a shared liquidity pool to maximize efficiency. Its innovative liquidity token, GLP, has been widely adopted by over 40 forked projects.

The recently launched GMX V2 introduced significant reforms for large traders, including:

- Introduction of price impact and funding fees;

- Reduced transaction fees;

- Independent LPs;

- Integration of Chainlink low-latency oracle.

GainsNetwork

Gains is one of the most powerful and profitable perpetual DEXs migrating to Arbitrum, with a total daily trading volume of $65.1 million. Similar to GMX, GNS utilizes a single liquidity pool (gDAI) to support trading activities on the Gains Network. Due to its flexibility and user-friendly experience, the GainsNetwork platform has become one of the most popular decentralized trading platforms for trading forex.

MUX Protocol

MUX is a cross-chain leverage trading protocol deployed on 5 different chains, with trading volume growth of over 300% this year. This can be attributed to its cross-chain strategy and real yield in liquidity provisioning. Protocol V3 will focus on achieving cross-chain aggregation, bringing liquidity from multiple networks such as Arbitrum, Optimism, BNB Chain, Avalanche, and Fantom. This will further enhance the success and expansion of its aggregator.

Lyra

Lyra stands out as one of the largest options trading platforms in the market, with a daily trading volume of $586,000. The community warmly welcomes their expansion to Arbitrum as it has become the central hub for most activities. Lyra is preparing to upgrade, promising to build the best decentralized options market in the DeFi space, offering:

- Options portfolio margin;

- Cross-margin between options and perpetual contracts;

- Multi-asset collateral.

Simultaneously, improving UX and building on the OP stack.

Dopex

Dopex has a TVL of $20 million, making it a powerful force in the options market. Despite having fewer assets under management than its competitors, it compensates with a diverse range of products. These products include Atlantic Straddles and interest rate options.

Dopex V.2 version update aims to reduce liquidity fragmentation. Users will be able to utilize centralized liquidity more effectively to create trading positions. @dLuxGMI has provided a great explanation for this: this comprehensive protocol update will greatly unify liquidity and enhance user experience.

Currently, the derivatives market is one of the largest markets in the crypto space, and regulatory pressure and market growth will continue to provide favorable conditions for the development in this field.