DerivaDAO DDX / DerivaDAO

What Is Deriva DAO (DDX)?

Deriva DAO is a decentralized exchange (DEX) for derivatives on Ethereum. It prides itself on offering key performance advantages over other DEXs like a real-time price feed, fast trade resolution, and a competitive fee structure. By being a DAO from the beginning, Deriva DAO’s traders and token holders directly control and govern the platform.

Deriva DAO aims to fill the void at the intersection of trading and blockchain by addressing the problems faced by other centralized and decentralized exchanges. Deriva solves the weak security and potential regulatory issues faced by CEXs by building as a DAO, thereby removing censorship concerns and a single point of failure. It also offers a performant and capital-efficient user experience with an order book model that addresses the liquidity and UX issues of decentralized exchanges. With its off-chain price feeds, matching engine, and liquidation operators, Deriva DAO promises to match the speed and efficiency of centralized exchanges.

Who Are the Founders of Deriva DAO?

Deriva DAO was founded by Aditya Palepu, a Duke alumnus and former algorithmic trader with experience in software engineering. He is supported by a team of nine, including co-founder Frederic Fortier, a San Francisco-based software engineer with over a decade of experience building distributed systems.

Deriva DAO is also supported by an impressive array of investors after closing several rounds for a total of $2.7 million. On the investor list are names such as Polychain Capital, Coinbase Ventures, Electric Capital, Dragonfly Capital Partners, CMS Holdings, Three Arrows Capital, Calvin Liu (the strategy lead of Compound), and crypto researcher Phil Daian.

What Makes Deriva DAO Unique?

Deriva DAO aims to stand out from the DEX crowd by utilizing a unique architecture. Unlike other exchanges, Deriva DAO handles trading and other exchange-related transactions not on a public blockchain but its DerivaDEX operator network. The DAO manages two tranches of staked insurance funds from its insurance mining program and organic insurance funds from its exchange fees on this L2 in order to backstop traders against auto-deleveraging.

This custom layer-two solution allows Deriva to compete with CEXs on speed and cost. High-frequency trading is only possible if sub-second transaction finality is guaranteed, which Deriva achieves through its custom L2. Moreover, users do not have to bother with high Ethereum gas fees in this case.