1. Introduction
dYdX Grants Ltd. (“dYdX Grants”), a wholly-owned subsidiary of the dYdX Foundation, is requesting $8M in DYDX from the dYdX Chain Community Treasury to launch, manage and operate a new dYdX Grants Program.
We expect this funding to last approximately 12-18 months. It will enable dYdX Grants to expand support for builders, researchers, and contributors across the dYdX ecosystem, with improved operational efficiency and cost-effectiveness, among other things, as further detailed in this proposal.
The dYdX Foundation’s mission is to support and grow the dYdX protocol ecosystem. Following recent changes in the dYdX ecosystem, including the recent transition of the Marketing, Business Development, and Solutions functions to dYdX International Ltd. (a wholly-owned subsidiary of dYdX Trading Inc.), the dYdX Foundation is now positioned to focus on ecosystem development by, among other things, operating a new version of the dYdX grants program.
After dYdX community feedback, we intend to launch an on-chain governance proposal on August 4, 2025 to seek community approval for the following actions:
- Authorise the transfer of $8M in DYDX ([14,285,714.29]* DYDX calculated using a 30-day TWAP at a [$0.56]* DYDX token price) from the dYdX Chain Community Treasury to a wallet owned and controlled by dYdX Grants Ltd.
- *Bracketed numbers as of July 22, 2025 as an example. The TWAP and total amount of DYDX requested are estimates and will be updated when the on-chain proposal is launched on August 4, 2025.
- Wind down the existing dYdX Ecosystem Development Program (“DEP”) and dissolve the dYdX Ecosystem Development Trust, a Guernsey non-charitable purpose trust.
- Assign all ongoing or continuing DEP grant obligations to dYdX Grants Ltd.
- Transfer any remaining assets from DEP to dYdX Grants Ltd., including but not limited to USDC and DYDX tokens, web content, websites, and other intellectual property rights or assets.
2. dYdX Foundation & dYdX Grants Overview
The dYdX Foundation was established in 2021 as an independent non-profit organization based in Zug, Switzerland. The dYdX Foundation’s purpose is to support and grow every aspect, technical or otherwise, of the current implementation and all future implementations of the dYdX protocol, including but not limited to the ecosystem related to the dYdX protocol, and to foster participation from others who seek to support and grow any aspect, technical or otherwise, of the dYdX ecosystem or the current implementation and all future implementations of the dYdX protocol. Specifically, the dYdX Foundation’s mandate empowers it to, among other things:
- Support and finance appropriate research and development activities and projects;
- Promote and educate the public on the dYdX ecosystem and/or dYdX protocol;
- Issue, receive, spend, and hold digital assets;
- Engage with various businesses, partners, banks, regulators, authorities, and other third parties to the benefit of the dYdX ecosystem;
- Acquire, hold, or grant trademarks, copyrights, and other intellectual property rights or licenses;
- Organize conferences and other events that support and promote the dYdX ecosystem and/or the dYdX protocol; and
- Conduct and promote all business and/or enter into all transactions, and generally perform all acts as may be necessary, appropriate, incidental to or desirable to assist in achieving or promoting the objects described above.
dYdX Grants is a wholly-owned Cayman Islands subsidiary of the dYdX Foundation and thus is subject to the Foundation’s oversight and control and to the Foundation’s statutory purpose and overall mandate. This ensures that any funds and resources held or controlled by the Foundation or any subsidiary, including dYdX Grants, must be used exclusively in furtherance of the Foundation’s mission and purpose and, therefore, for the ultimate benefit of the broader dYdX ecosystem. By housing dYdX Grants within the dYdX Foundation’s legal and fiduciary corporate structure, the community can be confident that funds will be deployed with strong accountability, aligned incentives, and full adherence to the ecosystem’s long-term goals and interests.
3. The DEP
The dYdX Ecosystem Development Program (formerly known as the dYdX Grants Program) was created as the first-ever dYdX subDAO in the form of a fully independent Guernsey non-charitable purpose trust, to serve as a partnerships and funding arm of dYdX, helping support infrastructure, chain services, protocol development, and growth. Over its ~3 year lifespan, the DEP (including previous iterations of the grants program) played an important role in accelerating the development and growth of the dYdX protocol, distributing approximately $15M in funding through 250 individual grants to 180 independent contributors.
We want to express our deep gratitude to all DEP contributors and grant recipients who, over the past 3 years, contributed their time, skills, and creativity to strengthen the dYdX ecosystem. Please note that, if this proposal is successful, the DEP will be wound up shortly after the execution of the proposal and, as a result, (i) approximately 44 active grants will be assigned to dYdX Grants (representing cumulative outstanding funding commitments of approximately ~$2.3M) and (ii) any remaining DEP assets, including DYDX and USDC holdings, will be transferred to dYdX Grants. As of July 22, 2025, the DEP has 1,109,014 DYDX and 1,225,801 USDC remaining (collectively worth approximately $1,846,848.84 using a 30-day TWAP of $0.56). Note that, if this proposal is successful, the amount of DYDX and USDC transferred from DEP to dYdX Grants may change based on new grants and existing payment obligations. As such, we will provide the exact balances of DYDX and USDC to be transferred from DEP to dYdX Grants when the on-chain proposal is launched.
Note that, upon a successful governance vote, any funds transferred to dYdX Grants as a result of this proposal shall become the sole and exclusive property of dYdX Grants and may be used by dYdX Grants in its sole discretion, subject to its and the dYdX Foundation’s statutory purpose and duties.
4. Rationale
We outline the rationale and key reasons for a dYdX Grants-operated dYdX Grants Program below.
- Strategic Alignment with Protocol Priorities: Thanks to (i) the expertise acquired through its 4-year trajectory, (ii) its relationship of trust and deep alignment with dYdX Trading Inc. and other dYdX ecosystem entities, including dYdX International Ltd., the dYdX Operations subDAO and the dYdX Treasury subDAO, and (iii) its renewed focus on dYdX governance and ecosystem aspects, the dYdX Foundation and dYdX Grants are perfectly positioned to ensure grant distribution aligns directly with the evolving needs of the dYdX protocol and ecosystem.
- Closer Community Feedback Loop: A Grants Program operated by dYdX Grants under the ultimate supervision of the dYdX Foundation will enable a tighter, more responsive feedback loop between dYdX grantees, the dYdX Foundation, dYdX Trading Inc., dYdX subDAOs (including the dYdX Operations subDAO and the dYdX Treasury subDAO) and the broader dYdX community. This structure will allow for faster iteration and adaptation to emerging priorities.
- Operational Continuity and Institutional Knowledge: The dYdX Foundation already collaborates closely with all dYdX subDAOs, infrastructure operators, community contributors, service providers, and core stakeholders, and concentrates a very vast amount of knowledge and context on all things dYdX. Managing the Grants Program in-house through its subsidiary dYdX Grants will allow the Foundation to leverage its operational experience, relationships, and know-how to provide a high-quality experience to grantees and the broader dYdX community.
- Improved Efficiency and Scalability: A Grants Program operated by dYdX Grants would significantly reduce overhead costs, maximize the share of capital deployed directly to builders, and ensure resources are allocated effectively and transparently. This approach will allow the program to scale more sustainably as ecosystem needs expand.
5. Funding Request & Allocation
We would like to request $8M in DYDX ([14,285,714.29]* DYDX calculated using a 30-day TWAP at a [$0.56]* DYDX token price) from the Community Treasury to fund the next 12-18 months of the dYdX Grants Program. The dYdX Community has access to almost 229M DYDX (worth approximately $128M using a 30-day TWAP of $0.56). Our request represents approximately 1.5% of the total DYDX supply and 6.2% of the DYDX assets available to the dYdX community.
DYDX assets available to the dYdX Community (as of July 22, 2025):
- Vested Community Treasury subDAO = 69,203,200 DYDX
- Vested Treasury = 59,348,567 DYDX
- Unvested Treasury = 66,503,895 DYDX
- Vested Rewards Treasury = 12,415,429 DYDX
- Unvested Rewards Treasury = 21,095,385 DYDX
- Total = 228,566,476 DYDX
*Bracketed numbers as of July 22, 2025 as an example. The TWAP and total amount of DYDX requested are estimates and will be updated when the on-chain proposal is launched on August 4, 2025.
Operating Capital
If this proposal is successful, dYdX Grants will have approximately $7.55M in net assets available to fund new grants and the operational expenses of the new Grants Program. The following summary assumes the proposal passes as drafted.
Net Assets = $7.55M
- Fundraise: $8M
- Funding in DYDX from the Community Treasury.
- Remaining DEP assets: ~$1.85M
- As of July 22, 2025, the DEP has 1,109,014 DYDX and 1,225,801 USDC remaining (collectively worth approximately $1,846,848.84 using a 30-day TWAP of $0.56). Final amounts may vary based on new and pending grant payments; exact figures will be provided at the time of the on-chain proposal.
- Outstanding Grant Commitments: ~$2.3M
- dYdX Grants will assume responsibility for approximately $2.3M in outstanding commitments for existing grants previously made by the DEP.
- No Formation Fee Repayment: The dYdX Foundation is not seeking reimbursement for any fees incurred during the formation of the dYdX Grants Ltd. entity.
Yearly Expenses
- Personnel: dYdX Grants will hire one Grants Lead, compensated at a market-competitive rate that is in line with their experience level. For simplicity, assume $120K/year.
- The Grants Lead will be supported by the entire dYdX Foundation team and will have access to shared operational and ecosystem-facing resources to maximize efficiency and impact.
- Administrative & Tooling Costs: Annual administrative and tooling expenses are estimated at $12K. This covers essential software, communications, and any professional services needed for smooth operations. The provided estimate is for illustrative purposes only and may change based on market fluctuations, inflation, and/or other price dynamics.
Asset Management
We recognize that the DYDX token price remains highly volatile and is currently below levels seen during the Foundation’s previous fundraise in January 2024. Our core priority is to fund the most impactful grants while preserving capital and ensuring the long-term sustainability of the dYdX ecosystem.
Whenever possible, we will distribute grants in DYDX, supporting the token’s utility and alignment with the community. However, to protect against market volatility and extend our operational runway, we are targeting $5–6 million in stablecoins from the newly raised amount over the coming months. This stable reserve will enable us to reliably support key initiatives and operational needs, even in challenging market conditions.
We intend to build a stable reserve through a combination of DYDX staking and/or OTC sales with aligned parties, always with the goal of minimizing negative impact on the DYDX token and the dYdX Chain network.
Anticipated Allocations
Based on our analysis of previous grants, existing commitments, and ecosystem needs, we anticipate the following allocation of funding:
- Infrastructure, Tooling & Security: 50% (~$4.92M)
- Ecosystem & Token Growth/Marketing: 30% (~$2.95M)
- Research and Development: 20% (~$1.97M)
Please note that the allocation of funding includes existing obligations from the DEP and will remain subject to change based on the evolving needs of the dYdX ecosystem. Below, we provide a description of each allocation category and examples of grants that have been funded in the past in each category.
Infrastructure, Tooling & Security: 50% (~$4.92M)
This allocation supports the development, improvement, and maintenance of core technical infrastructure and tooling in the dYdX ecosystem. Funding in this category may be used for integrations, modules, SDK development, dashboards, validator tools, as well as to enhance the security and reliability of dYdX-related products.
Examples of Funded Grants:
- Data Services
- Mintscan: Advanced Support Renewal
- Malicious App Detection and Signature Blocking
- API Endpoints for Circulating Supply, Fees, Rewards, and APR
Ecosystem & Token Growth/Marketing: 30% (~$2.95M)
This allocation is dedicated to accelerating the growth and visibility of the dYdX ecosystem. Funding will support incentive initiatives, strategic partnerships, new market expansion efforts, ecosystem marketing campaigns, educational initiatives, and ecosystem-building activities designed to onboard new users, developers, and partners.
Examples of Funded Grants:
- Free Deposit Campaign
- Surge Rewards Program
- New Market Listing
- Trading Arena
- Affiliate Program - VIP Initiative
- Cointelegraph Media Partnership
Research and Development: 20% (~$1.97M)
This allocation supports research-driven and experimental projects that advance the long-term vision of dYdX. Funding may go towards research, protocol/product features, future potential upgrades, or proofs-of-concept for novel features. The goal is to encourage deep technical exploration and thought leadership that can inform future protocol development and ecosystem strategy.
Examples of Funded Grants:
6. Program Structure and Process
Team
dYdX Grants is currently hiring a Grants Lead who will be responsible for overseeing the full lifecycle of the grantmaking process - ranging from defining strategic priorities, drafting RFPs, and evaluating applications to budget planning, milestone tracking, and post-grant impact assessments.
While the Grants Lead will serve as the primary operator of the program, they will be supported by the entire dYdX Foundation team and the Foundation’s infrastructure. This includes access to operational, administrative, and ecosystem-facing resources that will ensure the Grants Lead is empowered to work effectively and sustainably.
The Grants Lead will be compensated by dYdX Grants Ltd. using funds raised through this proposal.
Process
The following overview of the dYdX Grants Program process is provided for informational purposes only and is subject to change.
1. RFP, Open Application & Intake
If a specific need is identified within the dYdX ecosystem, a Request for Proposals (RFP) will be published. Alternatively, prospective grantees are welcome to submit proposals at any time using an online application form, which will be made available if this proposal is approved. All proposals should clearly outline the project’s objectives, milestones, deliverables, and the amount of funding requested.
2. Initial Screening & Alignment Check
Upon submission, each application will undergo a preliminary review by the team to ensure eligibility, completeness, and strategic fit. We may reach out to applicants for clarification or additional information at this stage, with a focus on surfacing projects that best serve ecosystem priorities.
3. Evaluation & Due Diligence
Proposals that pass the initial screening will be evaluated in detail against benchmarks (where applicable) and criteria such as potential impact, feasibility, ROI, support required, value for money, applicant experience and applicant track record. For technically complex or specialized proposals, we may engage subject matter experts from within or outside the dYdX ecosystem. We will work iteratively with applicants to refine their proposals and strengthen their plans before final review.
4. Decision & Approval
Alignment on deliverables and final funding decisions will be made by the dYdX Grants Directors or, subject to certain caps and limitations, by duly-authorised attorneys of dYdX Grants. The Directors of dYdX Grants are Charles d’Haussy (dYdX Foundation CEO) and Julian La Picque (dYdX Foundation Council Member). A Power of Attorney will be granted in favour of the Grants Lead and, potentially, of other key dYdX Foundation team members to enable them to manage and operate the Grants Program, subject to the direct supervision of the Directors and the ultimate oversight of the dYdX Foundation. All approved grants, along with basic project details and funding amounts, will be published for community awareness.
5. Funding, Monitoring, Reporting & Support
Where possible, grants will be structured with milestone-based deliverables and phased funding schedules. Funds shall be disbursed as grantees achieve agreed-upon milestones, ensuring progress and accountability throughout the respective grant’s lifecycle.
Grantees will be expected to provide regular progress updates on the dYdX Community Forum, highlighting achievements, challenges, and next steps.
dYdX Grants will maintain close contact with grantees, facilitating knowledge sharing and problem-solving as needed. Periodic check-ins (likely at least bi-weekly, but as needed depending on the grant) and milestone reviews will ensure alignment and continued value creation.
6. Completion & Ecosystem Impact
Upon completion, the success of each grant will be measured by its tangible impact on the dYdX ecosystem, recognizing that success metrics may differ across individual grants. Grantees will be required to share regular progress updates on the dYdX Forum, fostering transparency and community engagement throughout the grant’s lifecycle. In addition, dYdX Grants will provide monthly updates highlighting active grants, key milestones, impact assessments, and other relevant developments.
7. Grant Success, Transparency & Accountability
North Stars of the New dYdX Grants Program
- Improve the dYdX User Experience: Fund grants that make dYdX a more intuitive, accessible, competitive and compelling product offering.
- Drive Growth in Trading Activity and Active Users: Prioritize grants that directly grow dYdX’s trading volume and active user base. This includes initiatives that attract new traders, retain existing ones, and deepen engagement.
- Strengthen Security and Reliability: Build on dYdX’s reputation as the longest-standing and most secure perpetuals DEX by prioritizing grants that focus on infrastructure, audits, threat prevention, and validator tooling.
Transparency and Accountability Considerations
- Grantee Milestone Reporting:
Grantees will generally be expected to submit milestone updates at least bi-weekly - to support continuous progress tracking and maintain accountability and transparency throughout each grant’s lifecycle. - Public Program Updates:
The dYdX Grants team will publish monthly updates on the community forum to keep stakeholders informed about grant activity, expenses, financial situation, milestone progress and ecosystem impact. - Annual and Semi-Annual Ecosystem Reports: Formal reports will be published by the dYdX Foundation every 6 months to provide a high level overview of program operations, grant distribution, and strategic alignment with ecosystem priorities. A recent example of these semi-annual ecosystem reports is the 1H2025 dYdX Ecosystem Semi Annual Report, available here.
8. Next Steps
We welcome and encourage community feedback on this proposal. Barring any substantial concerns or suggestions, we plan to move forward with submitting an on-chain proposal on August 4, 2025.
FAQ
What is dYdX Grants Ltd.?
dYdX Grants Ltd. is a Cayman Islands exempted company wholly owned and controlled by the dYdX Foundation. dYdX Grants Ltd. was recently incorporated to serve as a ringfenced specific purpose vehicle to focus exclusively on the preparation, launch, administration and coordination of a new dYdX Grants Program to replace the current dYdX Ecosystem Development Program.
dYdX Grants Ltd.’s directors are Charles d’Haussy (dYdX Foundation CEO) and Julian LaPicque (Member of the dYdX Foundation Council).
How will the final DYDX price and amount be determined?
The on-chain proposal will transfer [14,285,714.29]* DYDX from the dYdX Chain Community Treasury to dYdX Grants’ multisig, calculated using a 30-day TWAP price of $[0.56]*.
*Bracketed numbers as of July 22, 2025 as an example. The TWAP and total amount of DYDX requested are estimates and will be updated when the on-chain proposal is launched on August 4, 2025.
Can I apply as a person/company based in a Restricted Jurisdiction?
Yes. Applicants based in Restricted Jurisdictions, as this term is defined in the dYdX Software Terms and/or the dydx.trade Terms of Use, will be able to apply for a grant. However, those applicants may be subjected to a stricter review process from a legal, regulatory and compliance standpoint, and, should they be approved to receive a grant, may not be eligible to receive certain assets (e.g. DYDX tokens) as part of the grant funding.
What is the application timeline? When can I expect to hear back?
We will aim to respond to applicants within one week. Actual processing time may vary depending on the complexity of the proposal, review requirements, and current application volume.
Does this proposal impact decentralization in the dYdX ecosystem?
We do not believe this proposal would materially impact decentralization within the dYdX ecosystem. While it would result in one fewer subDAO by consolidating the grants program under the dYdX Foundation’s corporate structure, the proposal does not affect the decentralization of the dYdX Chain at the infrastructure, governance, or validation layers. The validator set, on-chain voting rights, and block production mechanisms remain unchanged.
Our assessment is guided by the XYZ Decentralization Index, which views decentralization as a continuum. While the consolidation may very modestly centralize certain off-chain DAO operations, it improves execution and resource use in meaningful ways.
Specifically, the proposal removes costly legacy structures, reduces operational overhead, and improves capital efficiency - ultimately allowing more resources to be directed to dYdX builders and ecosystem contributors.
Importantly, the core pillars of decentralization in the dYdX ecosystem - permissionless participation, validator diversity, community governance, and transparent treasury oversight - remain intact.
Disclaimer
The dYdX Foundation’s purpose is to support the current implementation and any future implementations of the dYdX protocol and to foster community-driven growth in the dYdX ecosystem.
Nothing in this document shall be construed by anyone and, in particular, by dYdX ecosystem participants (including but not limited to DYDX token holders and dYdX Chain validators) as a representation, promise, commitment or undertaking by the dYdX Foundation or dYdX Grants to perform any action or provide any services, and no person should derive any actual or potential expectations whatsoever or be entitled to any type of legal action or claim of any type against dYdX Grants or the dYdX Foundation as a result of this document or the funding mentioned in this document. Upon a successful governance vote, any funds transferred to dYdX Grants as a result of this proposal shall become the sole and exclusive property of dYdX Grants and may be used by dYdX Grants in its sole discretion, subject to its and the dYdX Foundation’s statutory purpose and duties.
The dYdX Chain software is open-source software to be used or implemented by any party in accordance with the applicable license. At no time should the dYdX Chain or its software be deemed to be a product or service provided or made available in any way by the dYdX Foundation or dYdX Grants. Interactions with the dYdX Chain software or any implementation thereof are permissionless and disintermediated, subject to the terms of the applicable licenses and code. Users who interact with the dYdX Chain software (or any implementations thereof) will not be interacting with the dYdX Foundation or with dYdX Grants in any way whatsoever. The dYdX Foundation and dYdX Grants do not make any representations, warranties or covenants in connection with the dYdX Chain software (or any implementations and/or components thereof), including (without limitation) with regard to their technical properties or performance, as well as their actual or potential usefulness or suitability for any particular purpose.
Any third parties mentioned in this document are independent from and unaffiliated with the dYdX Foundation and dYdX Grants, and the dYdX Foundation and dYdX Grants are not responsible for any action taken by them or any other third parties, including content set forth on any third-party websites, such as any links to such content in this document. The dYdX Foundation and dYdX Grants are not responsible for any actions taken by any third parties who use dYdX Chain software or any implementations thereof.
Nothing in this document should be used or considered as legal, financial, tax, or any other advice, nor as an instruction or invitation to act by anyone. The dYdX Foundation and dYdX Grants make no recommendation as to how to vote on any proposal in dYdX governance, or to take any action whatsoever. The dYdX community is sovereign to make decisions freely and at its sole discretion, in accordance with the governance rules, principles, and mechanisms adopted by the dYdX DAO. The dYdX Foundation and dYdX Grants do not participate in governance decisions to be made by the dYdX community, including, without limitation, by voting on governance proposals. This proposal is solely based on the information available to the dYdX Foundation and dYdX Grants at the time it is made and should only be read and taken into consideration at the time it is made and on the basis of the circumstances that surround it. Some information contained in this document has been obtained from public sources and not independently verified by the dYdX Foundation or dYdX Grants; therefore, the dYdX Foundation and dYdX Grants do not make any representations or warranties as to the accuracy or correctness of any public information mentioned or used in this document.