Decoding the DEX newcomer Vertex: average daily trading volume of about 40 million US dollars in the past 7 days, with a daily trading volume market share of about 10%.

Decoding Vertex, the new DEX player: 7-day average daily trading volume of $40M, with a 10% market share.

The competition in the derivative DEX market has already become saturated. Numerous projects have followed the Fork GMX model and deployed on new public chains or layer twos, offering high APRs in an attempt to attract funds and generate profits. In comparison, Vertex has provided some innovative mechanisms to create better liquidity and higher capital utilization efficiency. LD Capital researcher duoduo has written an analysis of Vertex’s business data, differences with other derivative DEXs, and token economics.

Business Data:

1) Trading Volume: Mainly through trading incentives, a high trading volume has been created, with daily average trading volume of about $40 million in the past 7 days;

2) TVL: $6.22 million, still relatively small in scale;

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3) DAU: Cumulative number of users is 1842, with approximately 200 active users in the past 7 days;

4) Open Interest: There are 7 trading pairs in total, with BTC and ETH occupying the main share. The current position is approximately $5.37 million, and the position amount is also relatively low;

5) Fee: The cumulative gross income is about $540,000, deducting the rebate of $86,000 to the maker, the net income is $460,000.

The liquidity supply model is the main difference between Vertex and other derivative DEXs. Vertex believes that processing off-chain order book through FIFO (first in, first out) can reduce MEV attacks and improve transaction execution speed. On-chain AMM provides permissionless liquidity support, and traders can force transactions. When the liquidity in the order book is insufficient, it can ensure the effective conduct of transactions. Vertex achieves a mixed order book-AMM model through on-chain trading venue (AMM), on-chain risk engine, and off-chain sorter for order matching. Therefore, there are two types of liquidity coexisting on the Vertex trading platform, one is the liquidity of the order book provided by market makers through API, and the other is the LP funds provided by smart contracts. In addition, Vertex proposes the concept of “Universal Cross Margin”, which expands the scope of margin.

VRTX is the governance token of the Vertex Protocol, with a total supply of 1 billion, 90.08% of which will be distributed within 5 years. Specifically, 46% is used for community incentives; 41% is used for team, treasury, ecological funds, and future contributors; 8.5% is allocated to early investors; and another 4.5% is used for liquidity. Vertex tokens will be distributed six months after the mainnet launch, which is expected to be in October 2023. Since the Vertex protocol token has not yet been issued, it is impossible to avoid the behavior of wash trading due to the existence of trading incentives.

Reference: https://ld-capital.medium.com/vertex-%E8%A1%8D%E7%94%9F%E5%93%81dex%E6%96%B0%E7%A7%80-%E6%97%A5%E4%BA%A4%E6%98%93%E9%87%8F%E5%B8%82%E5%8D%A0%E7%8E%87%E7%BA%A610-5f93f4da036b

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