Many decentralized exchange aggregation protocols also favor the zero transaction spread of the GMX protocol. Yield YAK, a revenue aggregation protocol on the Avalanche blockchain network, has more than 35% of its trading volume done through the GLP liquidity pool.
From the social media and the GitHub public codebase, it is clear that this anonymous team is working hard on its development. While it’s impossible to rule out the possibility that the team disbanded and the project was abandoned, their ability to deliver products and introduce new features is evident to everyone and has earned them the trust of the copyright community and other projects.
This advantage is even more pronounced when large transactions are needed and decentralized exchanges such as 1inch have integrated GLP. Other decentralized exchanges, such as 1inch, also integrate liquidity from GLP liquidity pools. Yield YAK offers income products supporting GLP and GMX, and the profits earned are automatically reinvested.
This isolation prevents all liquidity providers from facing risk if one asset’s price is manipulated, as seen in past AVAX price manipulation attacks.
This result is not surprising; a simple search on the Net shows that more than 90% of traders are losing money. Even with a 50% chance of being right and a 50% chance of being wrong, the expectation of profit for traders on GMX is still negative, as each trade is burdened with fees for opening and closing positions and capital costs for maintaining them.
One of the key features of GMX is its scalability. The GMX blockchain is designed to handle a high volume of transactions without compromising on speed or efficiency.
Traders opening positions on GMX trade against the pool, with GLP functioning as the counterparty to traders on the platform. While this poses a risk to liquidity providers in GLP, historically, traders have lost more than they have profited, which results in a net increase in GLP value.
All copyright holders contribute to the Perfeito liquidity, whereas speculative traders and users with a net demand for buying and selling are responsible for most of the trading activity. However, there is often friction between the wants and demands of those who offer liquidity and those who buy and sell transactions.
GMX supports a selection of 21 assets and offers high leverage of up to 100x, beneficial to traders looking for higher-risk plays. Additionally, the platform rewards users through staking and liquidity more info provision, making it a popular choice for earning DeFi yield.
GMX is powered by Chainlink Oracles. It uses an aggregate price feed from leading volume exchanges to reduce liquidation risk from temporary wicks.
Introducing funding fees determined by the open interest of long and short positions, facilitating balance between the two through arbitrage.
The multi-asset liquidity pool model is an innovative mechanism. How does GMX achieve zero spread trading, no impermanent losses, and a diverse source of income for liquidity providers? The following is a detailed description.
That way, transactions are processed simultaneously, and validators' random polling ensures that transactions are correct with statistical certainty. There are pelo blocks in this consensus mechanism, allowing immediate finalization and significantly improving the blockchain’s speed.
Liquidity providers want high returns, and GMX opens the way to make this possible. As long as the market traders lose money, returns will increase. Liquidity providers do not want to take the risk of loss, GMX uses statistics to show that short-term losses will occur, but long-term profits are the inevitable result.