In today’s article we’ll cover:
- Overview of GMX perpetual trading
- The community
- Financial Metrics
- Tokenomics
- Smart contract safety
- Final thought
OVERVIEW OF GMX PERPETUAL TRADING
GMX is a decentralized spot and perpetual exchange that support low swap fees and zero price impact.
Trading in GMX is supported by the unique multi-asset pool that earns liquidity, provides fees for market making, swap fees, and leverage
The benefit of using GMX
- Reduction in liquidation risk: with an aggregate of high-quality price fees that determines when liquidation should occur, positions are safer from temporary wicks
- Saves cost: with GMX users can enter and exit positions with minimal speed and zero price impact
- Supply swap: GMX offers open positions through a simple swap interface.
COMMUNITY
Twitter: 141k followers, with over 500 active
Discord: 14k members, with over 3,141 active members
FINANCIAL METRICS
Total trading volume - $115b
Open interest - $268m
Total users - 262, 429
Circulating market cap - $898.76m
Fully diluted market cap - $925.21m
Total value locked - $579.94m
Fees (30d) - $16.99m
Revenue (30d) $5.10m
Daily active users
Revenue share
The fees are divided between;
- supply side: which is the share of the lending fees that go to the liquidity providers (not including fees for collateral)
- Revenue: which is the share of the trading fees that go to the protocol/GMX holders (not including fees for collateral deposit
(Image)
- Perpetual swaps generate the most fees for the protocol
- Arbitrum generates a fee of $439m, while Avalanche generates $74m
TOKENOMICS
The GMX protocol has a two-token ecosystem
GMX is the platforms utility and governance token holding the token unlocks the following benefits
- It can be used for staking: a staked GMX receives rewards of 30% fees generated from swaps and leverage trading which is converted to ETH/AVAX. If you are staking on Arbitrum you receive ETH, and for avalanche you receive AVAX
- It can be also used for floor price fund: which helps to ensure liquidity in GLP and provide a reliable stream of ETH incentives for all staked
Supply
The forecasted maximum supply of the GMX token is 13.25m. The increase in circulating supply will vary depending on the number of tokens that get vested and numb the number of tokens used for partnership and marketing.
- GMX token can also be bridged between Arbitrum and Ethereum
GLP
GLP the platform’s liquidity provider token. It consists of an index of assets used for swap & leverage trading. The price of printing and redemption is collateral-based (the total worth of assets in the index including profit and losses of positions divided by the GLP supply)
GMX SMART CONTRACT SAFETY
- Smart contract and team: The smart contract can be easy to find, with an active primary contract, a public software repository, a good development history & an anonymous team
- Documentation: There is a public white paper, a well-documented software architecture, and a possibility to trace the documented software to its implementation.
- Testing: The protocol has its tested code deployed and was deployed on the testnet
- Security: The protocol is sufficiently audited & the bouncing value is acceptably high
- Admin & control: The protocols admins control information is easy to find, with a well-labeled contract as upgradeable
- Oracle: The protocol’s oracle is efficiently documented, it’s mitigated by a front-running, flash loan attack is possible but the risk for it is mitigated
With this safety summary, we can say it's reasonable to trust the smart contract
Total security score = 85%
FINAL THOUGHT
GMX stands to be one of the best decentralized perpetual trading protocols, with a good product and a long-term space for growth and development.
Users of GMX can take advantage of its low swap fee price to perform trading on the platform.
Although the founder and team are anonymous, the product is doing so well as they’ve proposed it to do on their roadmap
In a long-term view, with a good safety pass mark. It will be safe to say GMX will keep thriving in the long term as a strong Defi perpetual protocol.
