GMX: A perpetual contract trading platform built on Arbitrum and Avalanche chains
GMX is a perpetual contract trading platform built on the Arbitrum and Avalanche blockchains, and is currently the protocol with the highest locked volume on Arbitrum. The uniqueness of the GMX platform lies in its innovative reward mechanism and strong community drive, which makes it stand out in the DeFi field.
Locked Amount and Protocol Income
As the protocol with the highest locked-in volume on Arbitrum, the GMX platform has demonstrated its strong appeal in the DeFi ecosystem. As of January 4, 2023, the total revenue of the GMX protocol has reached US$102 million, which fully demonstrates its influence and popularity in the market.
Fee Income Feedback Mechanism
One of the highlights of GMX is its fee income feedback mechanism. All fee income generated by the platform will be fed back to token holders in the ecosystem. This model not only enhances the confidence of token holders, but also promotes the long-term holding and stable growth of GMX tokens.
esGMX and Multiplier Points Rewards Program
In order to further incentivize user participation and lock-up, GMX launched the esGMX and multiplier point reward programs. esGMX is an equity token. Users can obtain more GMX tokens by holding and staking esGMX, thereby increasing their equity on the platform. The multiplier point reward program provides additional rewards for users who lock up for a long time, encouraging users to keep their assets on the platform for a long time, thereby enhancing the stability of the platform and the amount of locked positions.
GMX Token: The core functional token of the platform
GMX is the functional token of the protocol. Users holding GMX tokens can not only participate in platform governance, but also enjoy transaction fee dividends and other benefits. This makes GMX tokens not only valuable as an investment, but also plays an important role in the ecosystem.
Today's real-time price of GMX is $ 28.72 (GMX/USD), and the current market value is $ 274.02M USD. The 24-hour trading volume is $ 16.30M USD. The price of GMX to USD is updated in real time. GMX's increase or decrease in the past 24 hours is +4.26%, and the circulation is 9.54M.
GMX: Leading the new trend of decentralized trading
Layer 2 explodes, GMX rises
2022 is a year of rapid development of Layer 2 technology. The emergence of Layer 2 solutions such as Optimism and Arbitrum provides users with a low-fee on-chain trading environment. At the same time, the crisis events of centralized exchanges have led more users to turn to on-chain transactions and explore different types of trading platforms and derivatives exchanges. Against this backdrop, GMX has rapidly risen as a star derivatives platform in the Arbitrum ecosystem.
Advantages of decentralized exchange GMX
GMX provides contract trading services similar to those of centralized exchanges such as Binance, FTX, and Bybit, but as a decentralized trading platform, GMX does not require KYC certification. Users only need to have an on-chain wallet to participate in trading. This frictionless trading experience has attracted a large number of users to GMX and has the highest locked position on Arbitrum.
As of February 9, 2023, the total locked value (TVL) of the GMX platform has reached nearly $540 million, with more than 20,000 cumulative users. This has not only driven the growth of GMX itself, but also greatly promoted the prosperity of the DeFi ecosystem on Arbitrum. Arbitrum's TVL has long remained in the top five, and even recently surpassed Polygon.
Powerful trading platform
GMX not only provides contract trading, but also has a variety of highlights, including Swap function, up to 50 times leverage support, multi-chain support (such as Avalanche), oracle quotes 0 spread, etc. In addition, GMX's dual-currency economic model design (GMX and GLP) is even more eye-catching. Holders can stake GMX to obtain GLP.
GMX fee dividends: Stakers receive a 30% share of transaction fees, paid in ETH or AVAX (depending on the chain used).
esGMX: Stake GMX platform fee income.
Multiplier Points: Stakers can also earn multiplier points to further increase platform fee income.
It takes one year for esGMX tokens to be unlocked and converted into $GMX. During this period, no platform income can be obtained, but esGMX can continue to be accumulated through staking. This mechanism effectively alleviates the selling pressure of tokens, making GMX coin: Liquidity and income
$GLP is the liquidity pool token of the GMX platform and has the following features:
Transaction fee dividends: $GLP holders can receive 70% of the transaction fee dividends, paid in ETH or AVAX.
Protocol income distribution: $GLP holders share the platform's protocol income, which is used as a floor price fund to protect GMX
GMX avoids the impermanent loss problem commonly encountered by traditional liquidity providers (LPs).
$GLP includes multiple tokens such as ETH, BTC, LINK, UNI, USDC, etc., of which stablecoins account for about 50%. The official will adjust the weight of each token according to market conditions and guide users to maintain the overall balance of the liquidity pool.
Long-term profit potential
The GMX platform is designed so that $GLP holders can expect long-term gains. Data shows that as of October 2, 2022, traders have accumulated losses of approximately $6.4 million, which means that $GLP holders have a return of 42% in 2022.
GMX’s future potential: Fee income is about to surpass dYdX
In the DeFi world, the concept of real yield is gradually becoming a hot topic, and GMX, as one of the representatives of this concept, has performed remarkably. According to the data from Token Terminal, let’s compare the fee income of the three on-chain derivatives platforms, GMX, dYdX and Perpetual Protocol, over the past year.
Perpetual Protocol, which once shone brightly on Optimism, has seen its growth slow down, while GMX is growing at an astonishing rate and is about to surpass dYdX. GMX’s cumulative fee income has exceeded $100 million in the past year, demonstrating its strong market competitiveness.
Comparison of GMX with other protocols
If we compare GMX with other protocols of different categories, we can find that GMX performs better. Currently, GMX ranks fifth in cumulative revenue among all protocols and blockchains, second only to PancakeSwap, dYdX, Opensea and Ethereum. In the bear market environment, GMX still performs well and goes against the wind.
The rise of Arbitrum DeFi ecosystem
The growth of the GMX protocol is closely related to the growth of its transaction fees and user scale. If the transaction growth of GMX slows down and the income rate cannot catch up with the inflation rate, it will inevitably turn into a downward trend. Therefore, the key lies in how GMX can introduce more externalities to maintain the growth of transaction volume.
GMX is particularly outstanding in this regard, especially the high yield of its liquidity pool token $GLP, which has attracted the emergence of many DeFi protocols based on "GLP yield", forming a situation similar to Curve War, namely "GLP War". As long as $GLP yields continue, these DeFi protocols based on $GLP yields will survive and compete to attract funds in the market to provide liquidity. The following are some of the main protocols around GLP yields:
Rage Trade
Rage Trade is a full-chain DeFi protocol that hedges volatility by holding GLP positions and opening short positions. Their Delta Neutral GLP Vault product allows users to earn stable returns by depositing $ETH or stablecoins.
JonesDAO
JonesDAO uses leverage to increase GLP positions and increase returns. Users can deposit GLP or any token in the GLP basket (such as $UNI, $LINK, $ETH, $WBTC) into JonesDAO's jGLP vault, and the smart contract will borrow USDC from the vault to buy more GLP tokens.
Mugen Finance
Mugen Finance is a multi-chain yield aggregator based on LayerZero, which generates income for users through a sustainable model protocol. Users can stake $USDC to mint $MGN and earn income by staking $MGN. In particular, the reward for $MGN staking users is $WETH to avoid excessive volatility of $MGN tokens in the market.
GMX V4: Synthetic Assets Feature Update
The most watched update recently is the upcoming synthetic asset feature of the GMX platform. One of GMX's most famous competitors on Arbitrum is GNS Network, which migrated from Polygon. GNS Network not only provides derivative transactions of mainstream currencies (such as $BTC, $ETH trading pairs), but users can also trade foreign exchange and commodities on the platform. It is believed that this update of GMX will further enhance its platform competitiveness, expand more trading categories, and attract more users.
