June '23

Highlights

• Four grants approved with $441,200 in funding.
• A dYdX Indexer will go live through Grants.
• 47 new applications received.

Monthly Update

In June, the DGP approved four new grants for a total of $441,200 in funding. We have now issued 120 grants with over $3.7M in funding throughout the entire program lifecycle.

June was an exciting month for the DGP as we approached the dYdX v4 testnet and continued to learn more of the upcoming chain. More specifically, the team took a big step towards supporting the launch of dYdX v4 by funding a public Indexer. The Indexer is a read-only service optimized for high performant data requests from off-chain clients, like the frontend application. Imperator, a talented validator team with lots of relevant experience in the Cosmos space, will be spinning up the first public Indexer to support the v4 launch. Through this grant, the DGP is paving the way for external contributors to play a role in the architecture of dYdX v4 - an exciting future for everyone!

Heading into July, we continue to focus our efforts towards v4 infrastructure, MEV mitigation, protocol development, and international growth efforts. The more we learn about v4, the more we expand our opportunities to fund new efforts and onboard new contributors. If you are interested in supporting dYdX in this journey, give us a shout and submit an application!

Funded Grants

Below, we highlight updates from our latest grants and ongoing projects.

dYdX Testnet Indexer

Imperator will be kicking off their Indexer service by late July, following the v4 testnet launch. The grant is scheduled for three months, enough to cover the testnet period and eventual transition to mainnet. Our goal is to improve the testnet experience and support a successful mainnet launch. As a reminder, the Indexer is an open source read-only service that stores and feeds on-chain data to off-chain clients, like the frontend and other client applications.

MEV Dashboard

Skip are gearing up to release the MEV measurement dashboard, having worked tirelessly to familiarize themselves with the protocol throughout the private testnet. Heading into the public testnet, the dashboard will now be maintained through a new grant to deploy additional nodes and database services. The MEV dashboard will play an important role in allowing the community to identify and measure MEV activity on v4, enabling a future mitigation strategy.

dYdX Trusted Execution Environment Research

Trusted Execution Environments, a more secure type of server that includes attestations to the software being run inside of it, have emerged as possible solutions to MEV mitigation and client verification. Xenophon Labs will be conducting in-depth research to explore the topic in the context of dYdX v4. If successful, the research could result in an advanced solution to enable on-chain privacy that eliminates pre-block MEV.

LP Rewards Formula Optimization

0xCChan published an in-depth research report on the state of LP rewards, the incentive mechanism used to reward market makers for the liquidity they provide on dYdX. The paper explores historical activity along with comparative peer activity to make recommendations for improving the reward distribution.

IBC Seoul Event Sponsorship

The IBC summit in Seoul was a huge hit with lots of interesting speakers and attendees present to explore the future of IBC in Cosmos. We sponsored the event as an opportunity to grow the dYdX brand in the Cosmos ecosystem. Hisashi from the dYdX Foundation was a speaker, promoting the dYdX protocol and upcoming launch of v4.

Application Data

We received 47 new applications in June, a decrease from the previous month but higher than our previous average. Overall, we are seeing a healthy flow of new applications leading up to v4.

Operational Updates

Multi Sig Balance

915,916.35 DYDX ($1,877,628)

1,154,384.31 USDC

Funding Available

$2,100,000

Expenses

The program paid out the following expenses in June: