Proposal #11 Passes

Published by · Mar 12, 2024


Testing Framework and Updates

DerivaDEX proposal 11 has passed and will be shortly implemented on mainnet. Over the past few months, testing has taken place on three levels: Mainnet, Testnet, and local “fuzzing” environments. The mainnet testing has primarily assessed the exchange’s operator network, price feed, and other components in a production environment. This has surfaced a few issues that are resolved in the latest upgrade, and contribute to a more robust and stable exchange moving forward.

Testnet has also been involved in this process, enabling all users to make deposits and trade against a market-making bot, and has likewise supported in surfacing and replicating issues.

Local fuzzing environments are where testing occurs that serves to evaluate exchange performance under extremely high volume, user counts, and volatile price movements. The latest release, Proposal 11, has successfully passed all testing requirements on the fuzzing and testnet environments.

Moving Forward

As the stability and robustness of the DerivaDEX platform improves, it is likewise important to ensure that DerivaDEX has a sound and reasonable plan for serving users in the coming weeks and months. This can be thought of as an operational roadmap to complement the technical roadmap.

Through extensive conversations with stakeholders in this space, including counsel, regulators, market makers, and others, it is clear that there is a way for decentralized exchanges to work with existing marketplace structures – and that in many ways, this is necessary for growth and scaling of the industry. It is also true that decentralized exchanges have a lot to offer regulators and institutional traders, particularly regarding compliance, data transparency, and security of funds.

As part of these conversations, a high-level roadmap that is informed by the operational strategy is in development, and will be shared soon. Some of the questions that this roadmap should address include:

  • What does onboarding look like in the upcoming weeks/months?
  • What is the growth strategy of the DerivaDEX platform regarding onboarding?
  • What metrics is DerivaDEX focused on, and how is that informed by the operational strategy?

In broad strokes, the Guarded Launch is intended to take the exchange from pure testing to real usage. The technical requirements for this are in place, though they will continue to evolve and be improved upon. Operationally, the requirements are still being established. We hope to share more specifics on this front soon, and are actively working to support and build out this strategy.

The industry has seen a wide range of go-to-market strategies, each with their own strengths and tradeoffs. However, for products like a derivatives exchange, the costs of missteps can be high. DerivaDEX continues to seek to meet the needs of institutional and high-performance traders. These needs on a technical level are substantial, and DerivaDEX is uniquely positioned to satisfy them through the unique application of trusted hardware to achieve rapid transaction finality.

However, these market participants also have regulatory and operational needs, which require a thoughtful and future-facing strategy of engagement with existing regulatory frameworks. This is an aspect that DeFi has, as an industry, taken a hands-off approach towards. The drawback here is that many projects are not positioned to engage meaningfully with stakeholders on a path forward, and are more focused on short-term success. For this reason, we’ve seen too many exchanges function as “one cycle” products.

The DerivaDEX platform should be a product that is a joy for traders to use – not just for one cycle, but for the future of trading. Yes, that means that onboarding and go-to-market strategies will be slower than products who have a converse approach. The vision behind this approach is that this up-front investment in a robust strategy will create a foundation for growth and durability for the platform. A technical, and operationally sound derivatives DEX can open doors for new levels of liquidity, and new degrees of confidence, from a wider array of market participants, in this cycle and in the future.

Disclaimer DerivaDEX is not available in all jurisdictions, including the US. Users should be aware that there is a risk of financial loss whenever trading derivatives and margin products. Information found in these articles is not financial advice.