Sushiswap Coin And dYdX - Should You Enter?
Comparison of Sushi and dYdX projects.
SushiSwap (SUSHI) is an Ethereum token that powers SushiSwap, a decentralized cryptocurrency exchange and automated market maker built on Ethereum.
Holders of SUSHI can participate in community governance and stake their tokens to receive a portion of SushiSwap’s transaction fees.
Socials and growth
Overview of the Sushi Token
The SUSHI token was launched via a ~ two-week liquidity mining phase, using the "fair launch" mode with no pre-sale or VC allocation, open for everyone. And SUSHI is distributed through Liquidity Mining (Yield Farming).
When supplying liquidity, users can earn SUSHI tokens as mining rewards. 100 Sushi are created per block for tokens that are staked in the farms. These tokens will be evenly distributed to the miners in each fund pool, although 10% of all newly minted SUSHI will be allocated to a development fund. In other words, they will go into the hands of their creators.
For the inflationary token minting model not to dilute existing SUSHI, the value flowing into the token must match the value of new SUSHI entering circulation. In other words, if there is sufficient demand to buy up 100% of new SUSHI minted, there will be no inflation of supply about demand. Keeping in mind that Sushi can be staked, the rewards earned can also compensate for inflation.
The question is, what will happen with this kind of mechanics when the max supply is reached, which will happen in October 2023?
I assume until then, the project, which DAO governs, will undergo multiple updates addressing this question but right now, no information can be found.
The 1B of dYdX coins that were minted are allocated as follows:
50.00% to the community:
- 25.00% trading rewards to users who trade on the dYdX
- 7.50% to past users who complete certain trading milestones
- 7.50% to liquidity providers
- 5.00% to a community treasury
- 2.50% to users staking USDC to a liquidity staking pool
- 2.50% to users staking DYDX to a safety staking pool
- 27.73% to past investors
- 15.27% to founders, employees, advisors, and consultants
- 7.00% to future employees and consultants
The below chart shows how DYDX tokens are released into circulation, new coins will enter the market on a monthly basis and the max supply will be reached in August of 2026.
Supply information is key
Just as with the Sushi tokens, to compensate for the DYDX inflation, new users entering the market should buy all newly available DYDX tokens. However, looking at the growth rate of Sushiswap and dYdX socials, Sushiswap gives more confidence.
So what dYdX has to offer for users that Sushi or other Defi platforms can’t? The main value proposition of dYdX is trading DeFi assets with low fees and low gas costs at a low slippage. The platform includes all trading tools a trader needs and trades with leverage.
The platform was developed with a focus on ETH pairs because of the gas fees, but right now, it supports over 25 coins/tokens and other DeFi services such as lending and staking.
But how to use dYdX?
To use dYdX, one just needs a crypto wallet like Metamask. Users deposit their collateral to off-chain order books, and they only have to pay gas fees when depositing or withdrawing assets from the platform.
According to the official website, the exchange currently has 15K traders and 9,43B in trading volume in the last 24 hours. The project also shows exponential growth in the TVL chart. The number of coins locked in dYdX pools increased from August this year when the DYDX token was released:
In comparison, Sushi TVL also grows but at a more steady rate:
The below chart doesn’t include data from the last 2 months but it’s a great comparison in regards to 30-day annualized revenue of DeFi platforms where dYdX is an obvious leader.