dYdX – the leading DeFi derivatives exchange – announced a partnership with StarkWare for their Perpetual Contracts to run on StarkEx zkRollup by Q4 of this year.

 StarkWare is a Layer-2 scaling and privacy solution using zkSTARKS Technology. Outside of being backed by high profile investors like Pantera Capital, Polychain Capital, and Vitalik Buterin, StarkWare is powering a suite fo DeFi protocols including DeversiFi’s Layer 2 exchange.

With this partnership, dYdX will leverage StarkEx, a scalability engine offering scalable non-custodial trading on cryptocurrency exchanges.

Benefits of this integration include but are not limited to:

  • Significantly reduced gas costs and trading fees
  • Reduced minimum trade sizes
  • Cross-margin perpetual trading
  • More trading pairs
  • Instant settlement
  • High-performance price oracles
  • Higher leverage and lower liquidation penalties

With StarkEx, trades are matched off-chain and are settled on-chain using zK-Rollups. This helps combats front-running, a practice that has plagued DEX trading since inception. The advent of updated price oracles increases the economic security of the system against flash crashes and allows for real-time liquidations. 

 dYdX CEO, Antonio Juliano, tweeted that they have some of the most complex production contracts running on Ethereum and that StarkWare can scale them today.

Outside of this integration, StarkWare took part in the great Reddit scaling bake-off 2020, a fully detailed report of that here. While it’s unclear who the winning entry will be, it’s obvious that StarkWare is solidifying itself as a trusted solution for exchanges looking to offer scalability without compromising on privacy.

For dYdX, the partnership further expands the lead it’s established in the margin trading sectors. Despite products like DerivaDEX and Strike set to come online in the coming months, dYdX’s lead in pseudonymous leverage gives it a chance to rival Bitmex – especially after the leading exchange announced they will be enforcing KYC for all customers on here on out.

While dYdX perps are still unavailable to US customers, international traders are quickly flocking to the SF-based company as a means of trading top DeFi tokens with leverage in a permissionless fashion.

To stay up with dYdX, follow them on Twitter. To stay up with StarkWare, follow them on Twitter.