Understanding dYdX — Your Top Exchange for Professional Traders


dYdX Trading Tools

Margin trading

Isolated Margin

Cross Margin

  • Easy spot trades: Here let’s say that there are two assets in your portfolio. ETH and USDC. In this situation, let’s say that you have deposited (collected) your ETH but spot a bigger return rate on USDC. You can immediately turn your ETH to USDC and start to earn the interest in USDC.
  • Margin Long ETH: This is another great feature of the cross margin and what traders can use it for. Let’s say that my friend Daniel has 2 ETH, 100 DAI and 0 USDC. Based on the example, we are assuming that 1 ETH = 500 USDC. He can take leverage and increase his ETH position by making use of a cross trade. What is the implication? This trade would borrow USDC and sell it for ETH. By longing ETH, his balances at the end would then be 2 ETH, 100 DAI and -500 USDC. You might be wondering why there’s a negative balance on the USDC. It is easily as a result of the amount borrowed and this is collateralized by the ETH and DAI balance.
  • Margin Short ETH: We just saw what happened with the Margin Long ETH. With the Margin short, it is the other way round. Let’s say Felix has 0 ETH and 100 USDC. Felix can go short on his ETH position by performing a ‘sell’ cross trade. Our assumptions would remain that 1 ETH is $500. If Felix decides to sell 0.1 ETH which will be 50 USDC, his account balance would now read -0.1 ETH and 150 USDC. ETH is now short.

Perpetual Contracts on dYdX

dYdX Layers




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