Are crypto-based leveraged trading platforms really decentralized?

Are trading platforms like:

* dYdX
* and Gains (gTrade)

really decentralized?

These sites do not require KYC and the only way to use it is to connect using a web3 wallet (MetaMask, etc.). So, it is decentralized up to this point – during the funding and withdrawal phase.

However, once money gets “deposited” into the account, aren’t trades and transactions run by centralized servers? Does each trade gets run by a traditional server application backed by a database? Or otherwise, is each transaction executed by a smart contract and stored in a decentralized file system, and there is absolutely no centralized servers/apps/database? I’m curious to know how these platforms work.

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2 thoughts on “Are crypto-based leveraged trading platforms really decentralized?”

  1. It’s all stored and executed on chain with smart contracts, no servers or databases.

    You could argue that a small group control those contracts, but the execution is distributed

  2. Only on the surface.

    GMX and Gains run proprietary price feed oracles operated by their dev teams which is obviously a huge risk for all users. Their devs could rug users at any time if they choose to do so.

    DyDx is a little better, thanks to code they license from StarkWare – they’re essentially a rollup which means that you can withdraw your deposits no matter what. They also rely on price feed oracles, though I’m not sure who operates them. The DyDx orderbook is centralized, that’s one of the reasons why they’re moving to their own Cosmos L1.


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