DeFi Exchange Platform dYdX Places Solana in 'Close Only' Mode
Decentralized exchange dYdX placed Solana trades in “close only” mode, meaning users will only be able to close out their positions on the perpetuals exchange and not open new ones.
dYdX cited “market volatility” as its reason for making the move. Solana’s SOL token fell precipitously today on the news that FTX, a crypto exchange that holds a major stake in Solana, has become insolvent. SOL is currently priced at $14.10, down 40% from $24 a day ago.
Due to extreme market volatility, SOL-USD will be put into close-only. No new positions can be opened at this time.— dYdX (@dYdX) November 9, 2022
dYdX is a “hybrid” decentralized exchange that uses code – rather than a central intermediary – to facilitate most of its operations. The platform facilitated $3 billion worth of transactions in the past 24-hours, making it the largest DeFi exchange by daily trading volume according to CoinMarketCap.
Decentralized exchanges exist as a response to centralized trading platforms like FTX that take full custody of user funds – a practice that is viewed by some as anathema to crypto’s founding goals around self-sovereignty and trustlessness.
Though dYdX will continue allowing users to close out their positions, the announcement that it would disallow some kinds of trades – even to protect users – led to attacks from some who believe a “decentralized” platform shouldn’t be able to curtail user activity.
This is ridiculous, is this your definition of decentralization...it is very much centralized if you can make this decision without community vote— CryptoFi (💙,🧡) (@cryptoFi_Ent) November 9, 2022
dYdX is not the only trading platform that has restricted Solana trades due to the day’s high volatility and sinking prices. The centralized exchange Crypto.com halted Solana-based stablecoin deposits and withdraws earlier today, and the exchange OKX announced that it would delist Solana futures and stop listing new options.
dYdX didn’t immediately respond to CoinDesk’s request for comment.