dYdX Community Approves $60 Million Token Staking Proposal on Stride

The decentralized derivatives trading community dYdX has approved a proposal to stake 20 million DYDX tokens, approximately $60 million at the current price, using the Stride platform. This initiative aims to enhance network security and diversify the project’s asset portfolio.

According to confirmation from dYdX, the platform has staked 20 million DYDX tokens across the top 26 validators on Stride.

dYdX Community staked 20M DYDX from the community treasury to 26 validators via Stride (from a total active set of 60), increasing the $DYDX bonded rate to 13.7% https://t.co/l3xNiClOG4

Significantly reduces the top 10 validator concentration to ~60% and enhances… pic.twitter.com/JHNEBnhfX3

— David Gogel (古大卫) | dYdX (🦔,🦔) | we’re hiring (@dgogel) April 7, 2024

The interest generated from staking activities is calculated in USDC, which is then automatically reinvested to yield more DYDX for participants. dYdX founder Antonio Juliano explained that the generated interest will continuously be used to buy DYDX and return it to the project’s treasury.

In a vote with 81% voter turnout, the proposal passed with a 91% approval rate. However, some expressed dissent, suggesting that this decision might decrease the Annual Percentage Yield (APY) of dYdX, potentially making the token less attractive to new investors.

The dYdX community has voted to stake part of the treasury

The yield from fees generated will be continuously used via Stride to buy DYDX which will be returned back to the treasury

— Antonio | dYdX (@AntonioMJuliano) April 7, 2024

On the other hand, Stride welcomes this proposal and suggests only a 7.5% fee, a reduction of 2.5% from the usual 10% fee.

The @dYdX proposal to liquid stake 20M DYDX with Stride has passed ✅

An overwhelming 91.7% voted yes, with less than 1% voting no. Voter turn-out was an impressive 81.6%.

This prop will boost the economic security of dYdX chain, while improving stake decentralization 👍

— Stride (@stride_zone) April 7, 2024

Recently, dYdX also announced plans to establish a new legal entity in the Cayman Islands as a “defensive” reaction to the mounting legal pressure on the DeFi sector in the United States.