DerivaDEX has positioned itself as the first DAO-governed exchange functioning under official regulatory sanction by launching a decentralised derivatives platform certified by Bermuda.
The Bermuda Monetary Authority granted the platform a ‘T’ licence, which enables it to test its crypto derivatives business model with a select set of sophisticated institutional and retail participants. Digital asset companies looking to verify operating models prior to full authorisation are the target audience for this test licence.
Crypto perpetual swaps trading, a popular derivatives instrument that permits leveraged exposure without expiration dates, is now available on DerivaDEX. Over time, the exchange intends to enter other markets, such as prediction markets and traditional assets that have been tokenised.
The platform integrates Ethereum onchain settlement with off-chain order matching. The goal of this hybrid architecture is to maintain the security and transparency advantages of blockchain settlement while providing trading efficiency on par with centralised exchanges. By keeping non-custodial control over their money, users lower the risk of counterparties.
In order to prevent front-running and market manipulation, which are frequent issues in decentralised trading settings, DerivaDEX, created by DEXLabs, also includes encrypted order management and trusted execution environments.
A decentralised autonomous organisational structure is used to oversee governance choices and smart contracts are used to allow token holders to vote on protocol updates.
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