In this update: A recap of currently deployed DerivaDEX applications, results from the ongoing First Look testing sessions, gas benchmarking, and a high-level roadmap for what’s coming up.
Development recap
To start off, let’s recap on where development stands for DerivaDEX right now.
Governance:
In December of 2020, the DerivaDAO contract was deployed. This launch marked the genesis of the DerivaDAO itself, and included both the governance token contract deployment for $DDX, as well as the infrastructure for on-chain governance. With these contract deployments, the DerivaDAO (and only the DerivaDAO) can use governance to add new functionality and modify existing system parameters.
Insurance mining:
Simultaneously, the Insurance Mining program kicked off, and has continued to maintain a TVL of ~30mm+ USD since inception.
Since this launch, development has focused on the DerivaDEX Exchange itself. In recent weeks, this has included an initial testnet competition and first-look testing.
First-look testing
DEX Labs, the R&D firm building out the underlying technology for the DerivaDEX exchange, have also begun a new round of First-look UX testing in recent weeks.
First-Look tests recruit early community participants to join the DEX Labs UXR team for 30-minute sessions where they navigate the exchange UI, perform simple tasks, and provide feedback.
A quick summary of high-level findings :
- Perpetual swaps are complex products, and careful documentation of how specific features (cross margining, minimum maintenance margin, auto-deleveraging) work and are implemented is critical. Not every exchange implements these features the same way, and many users may have assumptions based on margin trading, but not specifically with perpetual swaps. For example, cross-margin enables users to apply the same capital as collateral to many different positions. Isolated margin requires collateral be applied specifically to individual positions, making the total collateral required greater, and potentially increasing the risk of liquidation. In initial research with professional and institutional traders, cross-margin was discovered to be a preferred feature.
- Visual design and responsiveness were rated highly by most users. The deposit and trade flows in particular were very clear to most users. However, other flows (especially where the requirements are not familiar to users i.e., a two-step withdrawal process) could still be improved.
- Meaningful error messages will help users make sense of any limitations (i.e., notional order size limits or free collateral).
Additionally, these tests consistently help in efforts to identify any UI bugs, unique cross-browser issues, and other problems. Want to participate in first-look testing in the future?
- sign up for research recruitment
- join the DerivaDEX Discord server to get pinged about last-minute openings!
Initial benchmarking
As testnet releases and UXR work continues, DEX Labs has also focused on stress-testing the system architecture. One of the goals for the exchange is that it be competitive with centralized exchanges on fees, liquidity, and trade execution speed.
Gas benchmarks
As (informally) evidenced in the latest Twitter poll, gas fees are of utmost importance to traders. In a nutshell, these fees are the cost a user must pay in order to have their transaction included in an Ethereum block. During times of high network congestion, these fees can skyrocket.
Currently, DerivaDEX deposits are roughly 65,000 gas, and withdrawals around 130,000 gas. Recall that this is the amount of gas used by the transaction — network congestion and Ethereum price determine the price of this amount of gas.
For comparison, a Uniswap transaction (without multicall) will cost roughly 100,000 gas.
To put this in perspective, a single deposit and withdrawal on DerivaDEX is about the same as two fills on Uniswap. Sometimes, a single trade on Uniswap and other DEXes requires multiple fills in different liquidity pools to get the best rate, which increases the overall gas used.
However, after a user deposits on DerivaDEX, she can trade any number of times without paying any additional Ethereum gas. This makes gas cost not only lower as a percentage of trades, but also means this expense is much more predictable. This is critically important for high-volume traders.
Roadmap updates
Development continues! As discussed, the first successful external trading competition has concluded.
First-look testing is ongoing, and there will likely be additional sessions opened up next week (keep your eyes on your inbox, or on the Discord!).
Next up, there will be another invitation-only trading competition. This competition will last for 7–10 days, and support 5–10x more users than participated in the last round.
The next major milestone will be a publicly accessible testnet and accompanying trading competition. This release will be feature-complete for launch, and will serve as a demonstration for the exchange architecture that will be proposed to the DerivaDAO as a mainnet candidate.
Join us!
Join the Discord and email list to learn more about upcoming products and early access opportunities.
