D4X.io: Decentralized Margin Trading Protocol
Last updated
Last updated
D4X.io - a decentralized protocol for creating and managing leveraged trading positions in the cryptocurrency market. It aims to bring the benefits of blockchain technology, such as transparency, security, and accessibility, to the world of leverage trading.
D4X is designed as a protocol that allows traders to establish long and short positions in the cryptocurrency market by automatically borrowing funds from investors in the ALP Pool.
The trader receives the entire profit from opening and closing positions, after deducting fees as a percentage for utilizing borrowed funds from investors in the APL Pool and the protocol fees.
Users can trade with leverage, which means they can control a larger position with a smaller amount of capital. Leverage allows traders to magnify their gains, but also increases the potential for losses. D4X may provide various leverage options to suit the risk appetite of different traders.
All open positions of traders are fully supported by swap operations on integrated DEXes and are 100% covered by corresponding amounts of cryptocurrencies resulting from these swaps.
Fairness of trades is preserved by using cryptocurrency exchange rates and performing swap operations directly on particular decentralized DEXes. This method removes the need for middlemen and minimizes the possibility of price manipulation or preferential treatment, guaranteeing that trades take place in a transparent and trustless environment.
To protect investors' funds and to prevent traders from facing substantial losses, the protocol integrates an automated decentralized Liquidation mechanism for opened positions.
In addition to this, the Insurance Fund is established, which safeguards investors of ALP Pools and provides the first level of coverage for hypothetical losses resulting from unfavorable swap rates, slippage and delays during the liquidation process.
By offering a decentralized solution for leverage trading, D4X aims to provide a more transparent, secure, and accessible way to participate in the global cryptocurrency market. However, it's crucial for users to understand the risks associated with leveraged trading and to consider their own risk tolerance before engaging in such activities.
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