GMX, a decentralized perpetual exchange, made a significant impact in the DeFi community when it launched on Arbitrum in early September 2021. It became the first DEX and perpetual market on the Arbitrum ecosystem, offering swaps and leverage trading. One of the key features of GMX was its shared liquidity pool system, which minimized price impact and attracted traders of all sizes. Within a month of its launch, GMX’s total value locked (TVL) reached over $30 million, with an average daily trading volume of ~$1.4 million. Today, GMX has grown even further, boasting a TVL of over $450 million and a 24-hour trading volume of $1 million.
The success of GMX also had a positive impact on the GMX token’s market price. Since its launch, the token’s price has appreciated by more than 200%. This success can be attributed to the demand for a decentralized perpetual market on Arbitrum and the flexibility it offered to traders.
Kinetix Finance: Bringing the Flywheel Effect to Kava Chain
Following in GMX’s footsteps, Kinetix Finance aims to revolutionize the DeFi space on Kava Chain. The Kinetix team has previously achieved success with Quickswap, the largest DEX on Polygon for over three years. Leveraging their experience, they are building a state-of-the-art v3 perpetual DEX on Kava Chain.
Similar to GMX, Kinetix will offer a shared liquidity system, making it the first decentralized trading venue with this feature on the Kava Chain and Cosmos ecosystems. Additionally, Kinetix will have a perpetual swaps market for leveraged trading, providing advanced traders with powerful trading strategies and benefits.
Kinetix’s perpetual market offers advanced traders access to various trading strategies and benefits. These include margin trading with up to 50x leverage, copy trading to learn from successful traders, and hedging to reduce risk. The platform also provides safer liquidations, better price execution, and no hidden spreads. Traders can enter and exit positions with different assets, thanks to cross-usable assets. Kinetix’s user-friendly interface and intuitive UI make trading easy, while reduced liquidation risks and built-in impermanent loss protection safeguard traders’ positions. Moreover, Kinetix’s perpetual market facilitates long and short positions, improving price discovery for underlying assets and contributing to better liquidity and accurate pricing.
At launch, Kinetix will support trading pairs such as $KAVA and $USDT, with more assets like $wBTC and $wETH being added soon.
With their experience and success on Quickswap and Quickperps (a GMX fork), the Kinetix team is well-positioned to achieve similar outcomes on the Kava Chain. Like Quickswap, Kinetix is the first shared liquidity DEX and perpetual swap market on the Kava Chain and Cosmos ecosystems, which creates positive market sentiment and accelerates liquidity growth and user activity.
While only time will tell if Kinetix can replicate GMX’s success, it is clear that the platform has the potential to attract traders and users looking for advanced trading strategies and incentives.
The DeFi space aims to transform traditional financial systems by bringing financial inclusion, transparency, and innovation to the world. However, challenging the existing traditional financial systems controlled by central banks, commercial banks, and stock exchanges is no easy task.
Despite the iron grip of traditional finance, many individuals in the DeFi space are taking risks to build and use state-of-the-art protocols like GMX and Kinetix. They recognize the potential rewards and benefits that come with embracing the decentralized nature of DeFi.
The risks involved in early adoption of DeFi are significant, but the reward of participating in a growing ecosystem and witnessing the flow of activity and liquidity from traditional finance to DeFi is compelling. It showcases to the world what traditional finance is missing and highlights the potential of decentralized solutions.
GMX’s success on Arbitrum has paved the way for the launch of Kinetix Finance on Kava Chain. Both platforms offer unique features and benefits that attract traders and users. While Kinetix aims to replicate the flywheel effect achieved by GMX, it remains to be seen if it can reach similar heights. Nevertheless, the growth of the DeFi ecosystem and the increasing adoption of decentralized protocols demonstrate the transformative power of this emerging industry. Keep an eye on GMX and Kinetix for the latest updates and developments in the DeFi space.
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