Market

How to Stake DYDX Tokens

Published

10 months ago

May 23, 2024

Coin2049 Newsletter

Decentralized finance (DeFi) platforms continuously transform, bringing innovative financial solutions and enhancing security through distributed systems. An essential component of the dYdX Chain’s functionality is its staking mechanism: as with other Proof-of-Stake consensus mechanisms, it secures and stabilizes the chain whilst enabling the community to actively participate in governance and consensus processes.

This article provides a guide to staking DYDX tokens on the dYdX Chain, from understanding the basics of staking to managing and optimizing your positions.

The Importance of Staking on dYdX Chain

Staking in the context of blockchain technology involves holding funds in a cryptocurrency wallet to support the operations of a blockchain network and receive rewards. In many Proof of Stake (PoS) mechanisms, staking contributes to the network’s security and efficiency. Users stake their tokens to gain the right to participate in managing the network, including voting on protocol changes and validating transactions.

dYdX Chain leverages the Cosmos SDK Staking module which supports a PoS blockchain and enables DYDX holders to become Validators and/or delegate the stake of their DYDX to a dYdX Chain Validator.

For the dYdX Chain, staking is not only a measure to secure the network but also a mechanism to reward stakers. Stakers help to decentralize the Validator set improving the decentralization of the network. In return, they earn staking rewards, which are predominantly derived from the trading fees generated by the platform.

dYdX distributes 100% of protocol fees to stakers in USDC instead of the native token. As of today, the protocol has allocated $24.6 million to over 21,000 stakers. According to Mintscan, current APR for staking DYDX sits at 19,45%.

How to Stake DYDX

The process of staking DYDX tokens involves several key steps:

Staking

Staking DYDX tokens on the dYdX Chain is key to secure the network, rewards stakers with USDC staking rewards and enables the community to participate in governance.. This guide will provide you with a clear and concise method to stake your DYDX using the Keplr wallet, which interfaces directly with the dYdX Chain, allowing for both standard and liquid staking options. Staking is also available through Ledger Live, Leap and Anchorage. Over time it’s likely there will be additional staking providers to choose from.

Keplr is a non-custodial blockchain wallet accessible via a web browser extension or mobile app. It’s specially designed for the Cosmos ecosystem and is enabled by Inter-Blockchain Communication (IBC).

Step-by-Step Procedure

1. Bridge Tokens:

First, make sure your DYDX tokens are on the dYdX Chain by following the bridging from Ethereum to dYdX Chain how to guide.

2. Setup Keplr Wallet:

New Users: Install the Keplr wallet extension, create an account, and navigate to the staking dashboard.
Existing Users: Import your wallet using a secret phrase and navigate to the staking dashboard.

Staking:

Access the ‘Staking’ section on the Keplr Dashboard.
Choose a Validator from the list and decide the amount of DYDX to stake.
Confirm the transaction by paying the required gas fee.

Follow this How-to-Stake guide for further information.

Liquid Staking Option

You can also opt for liquid staking through platforms like Stride, Quicksilver and pStake Finance, which allows you to stake DYDX and receive liquid staking tokens in return.

Staking DYDX is a straightforward process: once your tokens are bridged and your Keplr wallet is set up, you’re ready to jump in. By staking, you not only help secure the network, you receive 100% of protocol fees distributed to dYdX Chain Stakers. Choose your Validator/s wisely to maximize your returns and secure your investment.

Redelegating

Redelegating DYDX tokens allows you to shift your staked tokens from one Validator to another on the dYdX Chain without undergoing an un-bonding period. This guide will walk you through the process of re-delegation using the Keplr wallet, ensuring your tokens remain active and continue earning rewards while switching Validators.

1. Access Validators List:

Log into your Keplr wallet and navigate to the staking section where your current validators are listed.

2. Initiate Redelegation:

Click the arrow next to the validator where your DYDX tokens are currently staked.
Select “Redelegate” from the options.

3. Select New Validator:

Choose a new validator to whom you wish to shift your delegation.
Enter the amount of DYDX tokens you want to redelegate and confirm by clicking ‘Redelegate’.
Complete the transaction by paying the necessary gas fees on the dYdX Chain

4. Confirmation

After the transaction, check your dashboard to confirm the update to your staked tokens’ allocation.

Re-delegation is a valuable feature that enhances flexibility in staking strategies without sacrificing reward potential. It’s essential to consider the performance and reliability of new Validators Remember, the slashing risk of your tokens will follow the original Validator’s performance until the end of the u-nbonding period.

Unstaking

Unstaking DYDX tokens is a process to remove your tokens from being actively staked to a Validator on the dYdX Chain. This guide provides an overview of the steps to withdraw your stake using the Keplr wallet, detailing the un-bonding period and the management of the tokens post-unstake.

Step-by-Step Procedure

Access Keplr Dashboard:

Open your Keplr wallet and navigate to the validators to whom you have staked DYDX tokens.
Begin Unstaking:
- Click on the Validator from whom you wish to remove your stake.
- Enter the number of DYDX tokens you wish to un-stake and confirm by clicking ‘Undelegate’.
- Pay the necessary gas fee on the dYdX Chain to process the transaction.
Un-bonding Period:
Note that your DYDX tokens will enter a 30-day un-bonding period, during which they are not active but still under the slashing risk from the original validator.

Un-staking DYDX tokens allows you to regain control of your assets, but it requires understanding the risks and timing due to the un-bonding period. Once unstaked, you can choose to restake with a different Validator or manage your tokens as you see fit. This flexibility supports diverse strategies aligned with your investment goals and risk tolerance.

Key Considerations in Staking

Validator Performance

The choice of Validator is crucial since a Validator’s performance and reliability affect the staking rewards. Validators with high uptime and efficiency in transaction processing are likely to generate higher rewards for their stakers.

Slashing Risks

Staking on blockchain networks involves certain risks, including slashing. If a Validator acts maliciously or fails to fulfill their duties, they and their stakers may be penalized by slashing (partial loss) of the staked tokens. Therefore, choosing a reputable and reliable validator is essential.

Lock-Up Periods

Staked DYDX tokens are locked up during the staking period, which means they are not liquid and cannot be traded or transferred. Understanding the terms related to the lock-up period, including any conditions that might affect the ability to withdraw or move staked tokens, is vital for effective staking strategy planning.

Advanced Staking Strategies

Experienced stakers might engage in strategies such as staking derivatives, where they use synthetic assets to represent staked tokens, allowing them to remain liquid. Additionally, dynamic staking strategies might involve shifting stakes between validators based on performance and reward forecasts.

Conclusion

Staking DYDX tokens secures and stabilizes the network, rewards stakers with 100% of protocol fees distributed in USDC and enables the community to participate in governing a fully decentalized market leading protocol. To date over 15%(153M) of the total DYDX token supply is locked up and securing the dYdX Chain. When selecting Validators DYOR, manage risk, and if you decide to engage in advanced staking strategies understand the risks.

Disclaimer

In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content. Please note that our Terms and Conditions, Privacy Policy, and Disclaimers have been updated.

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Market

XRP Price Struggles as Whale Selling Rises To $2.3 Billion

Published

9 minutes ago

April 1, 2025

Coin2049 Newsletter

XRP has been on a consistent downtrend in recent days, with its price falling sharply and approaching the $2 mark. This has resulted in extended losses for the cryptocurrency, with a notable rise in selling pressure.

Despite the bearish momentum, key investors are trying to offset the negative impact.

XRP Whales Are Uncertain

Whale activity has been a major factor contributing to the recent decline in XRP’s price. Addresses holding between 100 million and 1 billion XRP have sold over 1.12 billion XRP, worth $2.34 billion, in the past seven days. This has brought their total holdings down to 8.98 billion XRP.

The selling activity from these whale addresses reflects a cautious outlook for XRP. While whale selling often indicates uncertainty in the market, it’s important to note that their behavior can also have significant short-term price movements. The recent heavy selling could signal that market participants are unsure about the short-term price action, and further bearish trends could follow if this continues.

On the broader market level, XRP’s macro momentum shows signs of divergence from the whale selling. The Liveliness metric, which tracks the behavior of long-term holders (LTHs), is currently declining.

A falling Liveliness typically signals that LTHs are accumulating more of the asset at lower prices rather than selling. This drop to a three-month low suggests that long-term holders are sticking to their conviction and accumulating XRP, even as whale selling intensifies.

The steady accumulation of LTHs might help cushion the bearish effects created by the whales. This behavior can counteract the selling pressure, potentially offering stability to XRP’s price and supporting a recovery if market conditions improve.

XRP Price Needs To Find Direction

XRP’s price has fallen by 14.5% this week, bringing it to $2.09, which is dangerously close to losing the critical $2.02 support level. The ongoing bearish momentum has created mixed signals in the market, which are likely to keep the price stuck in a narrow range for the time being.

If XRP can bounce back from the $2.02 support, it could recover some of the recent losses. However, the altcoin may remain consolidated below the $2.27 resistance level unless more positive news or market conditions arise to push it higher.

If XRP breaks through the $2.27 barrier or falls below $2.02, it could invalidate the current consolidation outlook. A successful breach of $2.27 could pave the way for a price recovery, with $2.56 being the next significant target.

Disclaimer

In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and Conditions, Privacy Policy, and Disclaimers have been updated.

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Market

Bitcoin Price Battles Key Hurdles—Is a Breakout Still Possible?

Published

1 hour ago

April 1, 2025

Coin2049 Newsletter

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Este artículo también está disponible en español.

Bitcoin price started another decline below the $83,500 zone. BTC is now consolidating and might struggle to recover above the $83,850 zone.

Bitcoin started a fresh decline below the $83,200 support zone.
The price is trading below $83,000 and the 100 hourly Simple moving average.
There is a connecting bullish trend line forming with support at $82,550 on the hourly chart of the BTC/USD pair (data feed from Kraken).
The pair could start another decline if it stays below the $83,850 resistance zone.

Bitcoin Price Faces Resistance

Bitcoin price failed to start a recovery wave and remained below the $85,500 level. BTC started another decline and traded below the support area at $83,500. The bears gained strength for a move below the $82,500 support zone.

The price even declined below the $82,000 level. A low was formed at $81,320 before there was a recovery wave. There was a move above the $82,500 level, but the bears were active near $83,850. The price is now consolidating and there was a drop below the 50% Fib retracement level of the upward move from the $81,320 swing low to the $83,870 high.

Bitcoin price is now trading below $83,250 and the 100 hourly Simple moving average. There is also a connecting bullish trend line forming with support at $82,550 on the hourly chart of the BTC/USD pair. On the upside, immediate resistance is near the $83,250 level. The first key resistance is near the $83,850 level.

The next key resistance could be $84,200. A close above the $84,200 resistance might send the price further higher. In the stated case, the price could rise and test the $84,800 resistance level. Any more gains might send the price toward the $85,000 level or even $85,500.

Another Decline In BTC?

If Bitcoin fails to rise above the $83,850 resistance zone, it could start a fresh decline. Immediate support on the downside is near the $82,550 level. The first major support is near the $82,250 level and the 61.8% Fib retracement level of the upward move from the $81,320 swing low to the $83,870 high.

The next support is now near the $81,250 zone. Any more losses might send the price toward the $80,000 support in the near term. The main support sits at $78,500.

Technical indicators:

Hourly MACD – The MACD is now losing pace in the bearish zone.

Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now below the 50 level.

Major Support Levels – $82,250, followed by $81,250.

Major Resistance Levels – $83,250 and $83,850.

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Market

Is CZ’s April Fool’s Joke a Crypto Reality or Just Fun?

Published

2 hours ago

April 1, 2025

Coin2049 Newsletter

On April 1, Binance co-founder Changpeng Zhao (CZ) shared an amusing hypothetical on social media platform X (Twitter).

He posed the hypothetical scenario of a user generating a cryptocurrency wallet address commonly used for token burns, which permanently remove tokens from circulation.

Binance’s CZ Shares Cryptic Hypothetical on April Fools Day

Changpeng Zhao’s April Fools’ joke about generating a token burn address sparked discussions. However, the chances of it happening are astronomically low. CZ shared the post during the early hours of the Asian session, kickstarting an interesting discourse.

“Imagine downloading Trust Wallet and finding your newly generated address is: 0x000000000000000000000000000000000000dead. Theoretically speaking, it has the same chance as any other address. Alright, enough imagining. Not gonna happen. Get back to building. Happy Apr 1!” Changpeng Zhao wrote.

It comes in time for April Fools’ Day, celebrated annually on April 1, dedicated to practical jokes, hoaxes, and playful deception. Trust Wallet, integrated as Binance’s non-custodial wallet provider, played along with the joke.

“Happy April Fool’s Day,” wrote Trust Wallet.

While the idea seems far-fetched, CZ was not technically wrong. Theoretically, there is an infinitesimally small probability that someone could randomly generate a wallet address matching “0x000…dead” using software like Trust Wallet.

However, the chances are comparable to winning the lottery multiple times. To put things into perspective, one can generate blockchain addresses using cryptographic hashing functions that produce 160-bit outputs.

This means there are 2¹⁶⁰ possible Ethereum addresses—a number so vast that generating any specific address, such as “0x000…dead,” is practically impossible.

“Haha, imagine the odds! That is a 1 in 2^160 type of vibe. Good one, CZ—back to work now, no distractions from the code,” Synergy Media wrote, putting the rarity into context.

While CZ’s April Fool’s joke entertained the crypto community, the reality remains unchanged. The likelihood of generating a wallet address identical to “0x000…dead” is close to zero. This means the post was a fun thought experiment but nothing more.

“Imagine that you can randomly generate a Bitcoin private key every second, and suddenly one day the private key you generated happens to correspond to Satoshi Nakamoto’s wallet or Binance’s wallet. That’s terrifying,” another user quipped.

However, the joke does highlight the fascinating cryptographic underpinnings of blockchain technology. While every address is technically possible, some are rare and might as well be myths. Crypto users will have to keep burning their tokens the old-fashioned way.

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