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How to use dYdX: A layer-2 decentralized trading platform

In this article, I will guide you through how to use dYdX, as well as take advantage of the opportunities to earn money from this platform.

linhha

Published Sep 27 2021

Updated Sep 14 2023

5 min read

What is dYdX?

dYdX is a layer-2 decentralized trading platform built on Ethereum that supports multiple financial products such as perpetual, margin trading, leveraged trading, and spot trading.

Specialities of dYdX

Margin Trading: dYdX provides a Layer 1 platform running on smart contracts of the Ethereum blockchain, allowing to trade without any intermediary. Also, dYdX allows users to lend with no minimum loan and waiting period.

Perpetual non-custodial trading: Perpetual is running on a layer-2 blockchain system. The system operates separately from the previous dYdX protocol on Ethereum.

Portfolio: dYdX supports portfolio management for traders to monitor their trades, claim Trading Rewards, and get fee discounts based on their trading volume.

How to start trading on dYdX

Download and install the Coin98 Super App

dYdX is now available on the Coin98 Super App for both iOS and Android users

Read the detailed instructions on how to use Coin98 Super App or watch the tutorial video to install the Coin98 Super App right here.

Download and install the Coin98 Extension Wallet

You can access chrome.coin98.com to install the Coin98 Extension Wallet.

For instructions on installing and using the Coin98 Extension Wallet, you can refer to this guide.

Create the Ethereum (ETH & ERC20 tokens)

After installing the Coin98 Super App, you can refer to the guidelines below to create an Ethereum (ETH, ERC20) wallet, or restore Ethereum wallets from other platforms to Coin98.

How to create an Ethereum Wallet.
How to import Ethereum (ETH, ERC20) wallet from MetaMask wallet here.

If you are already a Coin98 user, you can refresh or import multi-chain wallets to update your Ethereum wallet (ETH, ERC20) as well as other new wallets available in this version!

Prepare ETH to pay for the gas fee

Ethereum uses ETH for the gas fee, therefore, you need to have ETH in your account.

You can buy ETH on centralized exchanges like Binance, FTX,.. and withdraw to your Ethereum Wallet before experiencing the product.

How to use dYdX on Coin98 Super App

Access dYdX on the dApp Browser

Step 1: Open the Coin98 Super App and click Browser.

Step 2: Enter “dYdX” in the search bar, tap the dYdX logo in the results.

Connect your Ethereum Wallet with dYdX

Step 1: Click Connect at the right corner of the main interface.

Step 2: Select the Coin98 icon to connect.

Read the Term of Use carefully and click I agree, then click Send request. Your Ethereum (ETH) wallet will automatically be connected to dYdX.

If you want to change the wallet, click the name of the wallet in the lower right corner of the screen → Select the appropriate wallet.

How to deposit USDC on dYdX

Step 1: At the main screen, click Deposit.

Step 2: Users must enable USDC the first time depositing on dYdX, click Enable USDC on dYdX.

Step 3: Insert the amount of USDC you want to deposit and click Confirm deposit.

The system will charge a very small network fee for this transaction, if you agree, click Send.

Note: Only USDC stablecoin is accepted by dYdX. If you have other stablecoin, please swap them before depositing.

How to withdraw your asset on dYdX

In the Deposit section, there are two options for withdrawing USDC:

Fast withdraw: This option carries a small fee but does not require gas and sends immediately.
Slow withdraw: This option is free but requires two steps. Slow withdraw takes much longer (up to 12 hours) and users will have to pay their own gas fee.

Step 1: Choose your withdrawal option.

Step 2: Insert the amount of USDC you want to withdraw and click Confirm withdraw.

The system will charge a very small network fee for this transaction, if you agree, click Sign.

Note: Users can only withdraw up to 200,000 USDC each time

How to Margin Trade on dYdX

Step 1: Click Trade on the navigation scroll.

Step 2: Click the coin/token icon to search for your favorite coin/token. The dYdX exchange has the advantage of categorizing the market for users. So if you are looking for Layer 1 or DeFi tokens, just click on the appropriate tab.

Step 3: In this article, I will take the AVAX – USD pair as an example.

Users can choose Buy or Sell depending on their prediction.
The sell and buy price can be selected according to Market (the price according to the market) or Limit (the predicted price).
The dYdX exchange also has a Stop button that allows users to manually set the Stop Limit and Take Profit Limit for each position in order to reduce risk.
Leverage is a tool that allows users to take advantage of the level of borrowing available on dYdX to boost their trading fund in a higher profit/risk ratio. So, you should focus on selecting an acceptable leverage level. Leverage will be available at three levels: 2x, 5x, and 10x.

Note: Users can check their positions in the Portfolio section with detailed information for each.

Claim rewards on dYdX

The system will compute and save the transaction amount for each user. Those who trade on the dYdX Layer Protocol will get a total of 25% (equal to 250,000,000 DYDX) tokens, giving all dYdX traders a chance to obtain DYDX incentives. 3,835,616 DYDX will be distributed per epoch.

All rewards and staking contracts operate for 28 days, referred to as epochs. A new epoch automatically begins when the current epoch ends.

Users can see fees paid, average open interest, and estimated trading rewards at this website where users' trading data exists.

DYDX tokens earned via Trading Rewards will be transferable at the end of each epoch. DYDX token holders are required to wait approximately 7 days after the end of the epoch to claim their tokens

Governance – Staking

Users will earn DYDX rewards for staking USDC or DYDX. DYDX rewards will be distributed continuously according to each staker’s portion of the total USDC in the pool.

Step 1: Click Governance on the navigation scroll. Then click Connect Wallet → MetaMask.

Step 2: Choose your pool and click Stake.

Read the Terms of Use carefully, then click I agree.

Step 3: Users must enable USDC the first time when staking on dYdX, click Enable USDC.

Step 4: Insert the number of USDC you want to stake and click Stake fund.

The system will charge a very small network fee for this transaction, if you agree, click Sign.

Note:

Users must request to withdraw funds at least 14 days before the end of the epoch in order to withdraw funds after the end of that epoch. If users do not request to withdraw, their staked DYDX or USDC will be rolled over into the next epoch.
Users will need to pay gas fees to stake and unstake funds.
After USDC or DYDX holders deposited their tokens into the pool, they will receive a tokenized position (stkToken) that can be withdrawn or transferred as ERC-20. The stkDYDX token has the same proposing and voting rights as DYDX on dYdX governance.

Summary

Hopefully, this article has guided you well to experience dYdX directly on the Coin98 Super App. Take advantage of this opportunity and get yourself the best profit. If you have any questions or problems, leave a comment below to get assisted.