dYdX supports four types of business models, namely spot trading, margin trading, lending, and contract trading.

On the spot side, dYdX supports only three pairs, ETH/DAI, ETH/USDC, and DAI/USDC, which is much lower than Uniswap and the Roadmark protocol, which also uses an order book.

Margin trading. Margin trading supports a maximum of 5x leverage trading mode, and users can also customize the leverage multiplier. So, what is leverage? Simply put, leverage is the ratio of the value of a position to the initial margin. For example, if I use 1 ETH as margin, if my position value is 2ETH, then the leverage is 2 times; if the position value is 5ETH when I open the position, then the leverage is 5 times. The higher the leverage, the higher the risk, and the higher the possibility of being forced to close. Unlike centralized exchanges, this logic of dYdX is written into the smart contract and the risk is completely dependent on the contract risk.

Lending. Users can also deposit DAI, USDC, and ETH tokens to earn interest, with DAI currently having the highest interest rate at over 6%, with interest earnings coming from users who borrow. dYdX platform borrowers have an initial collateralization rate of 125%, with interest calculated according to blocks, and similar to Compound, liquidation will occur when a user's collateralization rate falls below 115% to repay the amount owed.

dYdX supports four types of business models, namely spot trading, margin trading, lending, and contract trading.

On the spot side, dYdX supports only three pairs, ETH/DAI, ETH/USDC, and DAI/USDC, which is much lower than Uniswap and the Roadmark protocol, which also uses an order book.

Margin trading. Margin trading supports a maximum of 5x leverage trading mode, and users can also customize the leverage multiplier. So, what is leverage? Simply put, leverage is the ratio of the value of a position to the initial margin. For example, if I use 1 ETH as margin, if my position value is 2ETH, then the leverage is 2 times; if the position value is 5ETH when I open the position, then the leverage is 5 times. The higher the leverage, the higher the risk, and the higher the possibility of being forced to close. Unlike centralized exchanges, this logic of dYdX is written into the smart contract and the risk is completely dependent on the contract risk.

Lending. Users can also deposit DAI, USDC, and ETH tokens to earn interest, with DAI currently having the highest interest rate at over 6%, with interest earnings coming from users who borrow. dYdX platform borrowers have an initial collateralization rate of 125%, with interest calculated according to blocks, and similar to Compound, liquidation will occur when a user's collateralization rate falls below 115% to repay the amount owed.