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Following a highly profitable private investment round, DTrade intends to create the first derivatives exchange on Polkadot.
After closing a $6.4 million seed funding round, decentralised exchange dTrade is adding derivatives trading to the Polkadot community, paving the way for broader decentralised finance usage cases on the developer network.
Some of the biggest names in the blockchain venture capital world, including Three Arrows Capital and DeFiance, led the private investment round. Polychain Capital, ParaFi Capital, Huobi, Mechanism Capital, Bixin Ventures, IOSG Ventures, Hypersphere Ventures, and Fenbushi Capital were among those who took part.
Several firms, including Alameda Research, CMS Holdings, MGNR, Kronos, and Wintermute, have also stepped up to support liquidity on dTrade.
Alameda Research has made significant investments in Defi this year, allocating $20 million to Reef Finance and $4 million to Coin98 Finance.
dTrade, as a decentralised market, supports the exchanging of permanent swaps and derivatives with on-chain settlement. In principle, the platform will support an infinite number of derivatives markets while avoiding custodial and counterparty costs. The trading site is not open to traders residing in the United States.
“Derivatives are on track to become the largest market in decentralized finance, similar to how they are the largest asset class in traditional finance,” said Nikodem Grzesiak, co-founder of dTrade. “Derivatives are an exciting use case of blockchain. Entirely new perpetual swaps for blockchain-based assets within Polkadot’s multi-chain architecture can be added through a simple governance proposal.”
The appeal of crypto futures has skyrocketed in the last year as investors pursue increased exposure to the increasingly expanding market. According to CoinMarketCap’s 2020 annual report, crypto derivatives accounted for 55% of the entire cryptocurrency market last year.
Polkadot’s developer network has also grown rapidly, with 435 projects having launched on the platform at the time of publication.