The development team of the crypto exchange, dYdX, recently announced on Twitter the launch of its public Testnet for its version 4 iteration. This marks the completion of milestone four out of the originally planned five, setting the stage for a future version 4 mainnet launch. As soon as it is implemented on the mainnet, v4 is expected to lay the foundation of complete decentralization for the dYdX exchange.
v4 Testnet is officially live 🚀🚀https://t.co/TD5caN6VSQ
Here are all the links you may need for easy access!
Public Testnet: https://t.co/BZ57SvuXNv
Testnet Status Page: https://t.co/7vkrGZs9fx
v4 Documentation: https://t.co/tKTUWacKldFeedback and Block Explorer links👇
— dYdX (@dYdX) July 5, 2023
The exchange has been built on both Ethereum and StarkEx networks. Considering how the exchange does not take custody of the funds of the users, it is a renowned decentralized exchange. However, dYdX features a centralized order book and a matching engine that enables market makers to place limit orders. This can be described as parallel with other market-maker decentralized exchanges that employ on-chain pricing algorithms to seamlessly match buyers and sellers.
However, version 4 would completely eliminate this centralized order book and the matching engine and would make the exchange fully decentralized without relying on an automated market maker. The masses believe that the exchange would do this by running specific parts of the app on a separate dYdX network with its own validators. This would make it possible for the order book to be stored on-chain.
dYdX Strives to be an Innovator
Based on the announcement of the exchange, it would be possible for users to request Testnet funds to try out the application. At the same time, the app would also allow them to place virtual trades, view profits and losses easily, and perform a number of other basic functions of the exchange. The ability to test bridging from one network to another has not been implemented yet but would be introduced as the public Testnet progresses.
As soon as the Testnet phase is completed, the dYdX team plans to immediately implement the fifth plan of the already specified roadmap. The fifth milestone would integrate dYdX and would also add support for Cosmos-Inter Blockchain Communication so that Cosmos users would have access to the application. It is expected that version four would be launched following the completion of the final milestone.
Apart from this, the dYdX exchange announced in April this year that it would wind down its operations in Canada as a result of increased regulatory pressure. The exchange previously offered users a $25 bonus if they proved they were not bots, which eventually resulted in a major pushback from privacy advocates. However, the promotion was later abandoned.
