Proposals for new token listings are being consistently approved.
Liquidity Concerns:
Despite aggressive listing, many newly added markets suffer from minimal liquidity.
This raises doubts about the effectiveness and value of adding new tokens.
Upcoming Solution: Automated Market Maker (AMM)
Anticipated Solution:
The introduction of an AMM feature on the DYDX chain is imminent.
The AMM functionality is expected to alleviate current liquidity issues.
Discussion Points: Validators and Voters’ Perspective
Rationale Inquiry:
Pending the implementation of AMM, a pertinent question arises for validators and voters on what justifies the listing of tokens with scant liquidity in the interim?
Risk Considerations:
Token listings lacking liquidity pose substantial risks for traders.
Wider spreads and increased liquidation risks can result from inadequate market depth.
Illustrative Example: Recent Token Additions
Volume Analysis:
Notable recent additions, such as CHZ and DYDX, exhibit negligible trading volumes.
The combined trading volume for these tokens over the past 24 hours is less than $500.
We are definitely aligned with the analysis you shared. We have also noted that recent additions don’t necessarily serve the users. It is still good to see the community taking over the steps to list new tokens as a sign of a healthy decentralized governance. But we also suggest a slowdown might considered at this point to avoid a “race to the bottom” strategy to pursue the current listing pace, only to going lower and lower down the risk curve. We always advocate for quality over quantity and the latest additions seems to fall more in the latter category.
As the representative of PRO Delegators’ validator, we will begin to decline proposals that do not meet our risk threshold. You correctly pointed out the potential of the AMM feature to enhance service for less liquid pairs, and we agree. Pending this development, we will implement a more stringent decision framework for voting on new applications.
Maybe the pace of the assets is not the problem, but the type of assets.
I see mainly assets being proposed which are already at 6+ major CEX. There is already a market for these assets on the big exchanges, which makes it harder to get a piece of the pie, because why would a trader move its assets from the bigger exchanges?
Maybe it should be considered to spend more time in the research and find the more edge cases, which are interesting/promising, but not so heavily listed yet. Those might attract a bigger market share in general on DYDX.
quite simply. No, the latest is this WIF-USD addition. some sort of trending dog token and I certainly understand the FOMO so to speak by whoever is making the decision to list these tokens as these are the highly traded small and micro cap tokens of the cycle.
However, as of the morning of 5/4 we have a candle print on DYDX where someone was obviously scared out or even worse liquidated . or i guess bought like a dumbass too but you can see the volume up there at $4.50 which is $1 off $3.5 price every else. you can just look and see that its listed but it is NOT TRADEABLE…
whoever came up with the liquidity criteria for listing… um thats a massive FAIL. metrics like that would be supposed to prevent listing of trading like this. the liquidity metrics and cut offs for listing tokens has been a total bust. horrendous work by whomever is in charge of that. (someone whom has likely looted the “community treasury”)
again, just to clarify. WIF-USD trades $4.50 on DYDX the morning of may 4th where it never traded that price on any major trading platforms. one must be careful trading margin on such instruments as a “bad tick” and your account is stolen in a sense and liquidated at the top.
this is EXTREMELY DANGEROUS for a TRADING PLATFORM to be participating in. and quite frankly is the reason things are regulated. huge “decentralized” fail here.
This would have been a result of limited liquidity and wider spreads, if there are no buyers and sellers and spread is wide, your market orders are bound to land you in losses and that is the reason why I wanted to wait until AMM comes into play in v5 upgrade before we list new markets
yeah i thought that was a great idea on the AMM thing, it makes no sense to continue to try and list these. if we could it might be interested to see how some accounts (they can be anonimitized) have gotten burned by some of these low liquidity tokens.
I am sure someone has a horror story somewhere.
anyway high hopes for the AMM, hopefully will be implemented ASAP !
