Dolomite DEX (non-custodial decentralized exchange) stated that it will introduce a margin trading that will feature stop-loss orders on November 4. In a press release, the company explained that its new margin trading feature will run on the dYdX protocol. It will run on this protocol even though its current exchange is based on the Loopring protocol.
Trade Positions with Stop Orders
According to that press release, the platform’s users can take long positions with leverage ranging up to 5X. Also, they can take short positions with up to 4X leverage direct from their wallets. Additionally, Dolomite also alleges:
“Dolomite will also be one of the first decentralized exchanges to offer leveraged limit order trades, allowing a leveraged trade to fill only at a certain price. Dolomite is building off of the dYdX margin lending protocol, giving it access to over $30 million in lending liquidity.”
Trustless Margin Trading Protocol
Corey Caplan, Dolomite CEO, and co-founder said exclusively that the dYdX protocol enables the platform to smoothly work with all exchanges to open and close positions. Moreover, it is designed in a modular fashion. Thus, it brings many benefits for platforms to utilize.
Therefore, Dolomite can capture the trade volume from the users’ opening and closing positions. Users can also maintain lower collateralization compared to the other margin lending protocols which enable users to trade with more leverage.
Caplan alleges that his platform is the first one to integrate with the dYdX protocol. He then explained that the ability to feature limit orders on the DEX came as a result of the modular design of the involved protocol. He added:
“Dolomite is also uniquely offering Margin Protection which is a stop-loss function that will close traders’ positions on Dolomite before they are liquidated by dYdX. This saves users from losing the entirety of their margin deposits when they open a position. We were only able to add this feature in because of the modularity of their protocol.”
Since there is a clear relationship between decentralized stablecoin DAI and dYdX protocol, Caplan was asked to illustrate the details of the new collaboration. He admitted that he is yet to know the in-depth details but the two systems are working seamlessly:
“We are not yet sure of their relationship. But it’s likely good considering they are one of the biggest lending protocols surrounding DAI in the ecosystem. DAI is also central to dYdX’s lending liquidity and trade volume.”
Earlier reports in late October revealed that John McAfee has argued for the benefits of stablecoins for DEX adoption.