dYdX trading to phase out v3 platform in favor of ‘Unlimited’ upgrade

dYdX Trading Inc., a pioneer in perpetual markets, is planning to discontinue the dYdX v3 platform by the end of October.

According to a post on X, the transition will pave the way for the launch of dYdX Unlimited this fall. The sunset of the v3 platform will primarily affect users of dYdX v3. However, users of dYdX Chain, dydx.trade, or the v4 API will remain unaffected.

dYdX Trading Inc. urges users to withdraw USDC before the transition date

dYdX stated that the deactivation is consistent with its objective of “truly unlimited” decentralized trading. The move follows the successful mainnet launch of the v4 chain in 2023, which resulted in more than $220 billion in trade volume. 

From now until the mentioned date, dYdX v3 will continue to operate normally, with uninterrupted trading. However, users are encouraged to plan to wind down their positions and withdraw their USDC from the platform. Trading, oracle-price updates, and funding payments are scheduled to cease on October 28 at 12:05 P.M. UTC.

Two days after the dYdX v3 platform is shut down, the Ethereum smart contract will register the L2 exchange as “frozen,”. This will allow users to withdraw the full USDC value of their accounts without incurring any trading or liquidation fees, aside from gas fees associated with Ethereum transactions.

dYdX Trading prioritizes user control and liquidity as it considers selling its v3 platform

dYdX Trading makes it clear that they value giving users control by saying:

We at dYdX Trading will never custody your funds.

dYdX Trading

All user accounts and their funds are held securely within the Ethereum smart contract system so that users can withdraw their USDC without depending on dYdX Trading or any other third-party entity. 

The company intends to keep access to read-only historical data through API for a minimum of one year after the shutdown date to ensure users can still view past trading details. 

The dYdX v3 platform, which received significant startup money from organizations such as Andreessen Horowitz and Paradigm, was immensely popular with investors due to its high liquidity and reduced slippage on larger trades.

VanEck’s March 2023 report projected the platform earned $137 million in fees at the end of 2022. Its operator has already chosen to retire the platform in favor of a more modern successor.

In July, speculations surfaced that dYdX Trading was considering selling the decentralized exchange platform. Wintermute Trading and Selini Capital are among the potential bidders, while Perella Weinberg Partners is advising dYdX Trading on the transaction.