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The dYdX ecosystem has been growing since it was founded back in 2017. The exchange has now become one of the leading decentralized exchanges for trading perpetuals, a trading product similar to futures contracts minus the expiration dates.
According to Coingecko, the governance token of the exchange, DYDX, has catapulted 175% in the bi-weekly with the biggest gains made in the monthly time frame at nearly 200%. This has been caused by positive on-chain developments and the complete shift in sentiment in cryptocurrencies.
2022: The Year Of Growth For DYDX
The annual report shows that the ecosystem has grown substantially. The report shows an additional 61,500 unique addresses that received DYDX as a reward. Employee-wise, the DEX also grew from three full time employees to 12 full-timers and seven part-time contractors.
In the world of trading, dYdX V3 is showing strength. The report shows 33,000 active traders contributing more than $137.8 million in fees. This shows that a significant amount of people are using the platform despite strong market headwinds.
The protocol is also set to enter full decentralization as the dYdx V4 trading platform is being developed. Development would continue in so-called “Milestones” with the team completing the second on January 17.
Token Breaks May Level
As the time of writing, the token is trading at $3.54, breaking the $3.3 level in registered in May 2022. A bullish break above its current price could set up the bulls to create higher highs, regaining ground lost as a result of the 2022 bear market.
However, this breakthrough might come at a later date as the token moves down towards its current support at $2.7 which may be a shaky support level for the token. If the bears claw through this support, DYDX might revert to its $2.2 support which may offer some resistance towards further bearish breaks.
Investors and traders should be cautious at entering DYDX’s current market price as the current rejection at its current resistance might push it lower. But with the positive growth metrics shown in the annual report, DYDX bulls might be able to enjoy some short to medium term gains.
But the breakthrough above its current resistance might come at a later date as the token enters a consolidation phase. DYDX at $2.7 would enable bulls to enjoy a steady momentum that will lead to a breakthrough.
For now, strengthening the current support and consolidating gains for a steady momentum upwards is the order of the day.
Featured image from Chain Debrief
The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.