The dYdX team is about to unlock 30% of DYDX supply to investors on the dYdX chain, causing the price of the token to fall as much as 7%.
Decentralized exchange dYdX is set to unlock 30% of DYDX supply on Friday, Dec. 1, 2023, by issuing 500 million DYDX (also known as ethDYDX) tokens to past investors of dYdX Trading Inc.
According to an X post from Lookonchain, a blockchain analytics firm, the dYdX Foundation has sent tokens to investor addresses, including a16z crypto, Defiance Capital, and Polychain Capital.
However, it appears that “many investor addresses have bridged DYDX” through multiple addresses via wethDYDX smart contract, which is a one-way bridge for DYDX tokens to be migrated from Ethereum to the dYdX Chain network.
As of press time, a total of 437.4M DYDX (worth nearly $1.5 billion) has been bridged, accounting for more than 40% of the total supply, Lookonchain said. Amid the news, DYDX price dropped by nearly 7% to $3.2, according to CoinGecko.
DYDX goes to dYdX Chain
In late Oct. 2023, the dYdX Foundation unveiled a series of pivotal updates that signalled a new phase for the dYdX ecosystem. Most notably, the mainnet genesis of the dYdX Chain went live, with genesis validators having participated in the creation of its first block.
The dYdX chain is currently in its post-genesis phase, comprising two stages: alpha and beta. The alpha stage focuses on enhancing the network’s stability and security. A critical part of this effort involves staking DYDX tokens to dYdX Chain validators, which improves network resiliency by making coordinated attacks more difficult.
The transition to the beta stage will hinge on performance metrics and a successful governance vote, among other criteria. The beta stage aims to introduce limited trading functionalities and pave the way for a full-fledged version of the dYdX Chain.