GMX is a popular decentralized exchange that specializes in perpetual futures trading. Launched on the Ethereum Layer 2 network Arbitrum in late 2021 and later deployed to Avalanche, the project has quickly gained traction by offering users leverage of up to 30 times their deposited collateral.
In that case, suddenly, a large number of users in the market using USDC stablecoins to buy LINK tokens in stock, the number of LINK tokens in the GLP liquidity pool will decrease dramatically, and the increased utilization of funds will prompt the contract to go long. The funding rate of LINK will rise rapidly. In other words, the price impact of large transactions on the liquidity pool is still there, but the cost is passed on to traders as funding rates.
This helps to ensure that referrers receive the rebates for the users they brought onto the platform. Here is the link to apply for the referral program.
However, this did not deter GMX’s growth in any real way thus far. Since the start of 2022, GMX averages a protocol revenue of USD $2M per month.
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GMX is committed to complying with all relevant regulations and laws. The project works closely with regulatory bodies to ensure that GMX is read more a safe and legal digital asset.
GMX’s core product is its trading facilities. It allows users to conduct spot trading and perpetual contract trading. Users can leverage up to 30x on their trades thanks to its ability to leverage liquidity. GMX operates as an automated market maker (AMM).
On every centralized exchange, liquidity is achieved from a traditional order book model which is reliant on market makers. An order book lists the quantities of the asset being bid on or offered at each price point, or market depth.
Changing the borrowing fee structure to only charge the side (long or short) with greater open interest, instead of charging both sides.
Among the new features, dYdX V4 introduces permissionless markets, allowing users to list and trade any asset instantly, provided there is an oracle price available.
The second token, GLP, represents the index of assets used in the protocol’s trading pool. GLP coins can be minted using assets from the index, such as BTC or ETH, and can be burned to redeem these assets. GLP holders provide the liquidity traders need to get leverage. This means they book a profit when traders take a loss, and they take a loss when traders book a profit.
Protocol revenue is split 70/30 between $GLP and the other protocol token $GMX. In addition to getting the larger share of protocol revenues, $GLP holders also get all the collateral when positions are liquidated which leads to a fluctuating but over-time growing inflow of revenue.
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