Top 5 DEXs that could grow in the next few years, according to crypto analyst Miles Deutscher

The recent explosive growth in the price of native tokens from decentralized exchanges GMX (GMX) and Gains Network (GNS) allowed investors to make good money. The value of $GMX jumped 50% to a record $60.45 following its listing on Binance on October 5. The current price is $42.80, according to CoinMarketCap. And $GNS went from $2 to $3.61 as of October 31.

GMX TVL hit a new all-time high of $482.78m today pic.twitter.com/RqJ61AfF40

— DefiLlama.com (@DefiLlama) October 27, 2022

In order for those who missed the opportunity to make some extra money to not get hit by FOMOFear of missing out., crypto analyst Miles Deutscher named five other potentially promising projects and explained why, in his opinion, the decentralized finance sector could grow by 100 times in the next few years.

“There’s also a chance existing platforms like GMX and GNS decide to introduce options trading in the future”, he noted.

What is an option?

An option is a derivative contract that gives the buyer the right (but not the obligation) to buy or sell the underlying asset at a set price on the expiration date. 

What is options trading? 

Essentially, they are contracts that allow traders to speculate on the future price of an asset. A call option = a bet to increase the price. A put option = a bet on a price decrease.

Options trading has many advantages due to the following:

• Usefulness as a hedging tool (risk management);
• Lower cost of opening long/short positions (cost-effectiveness);
• Flexibility to implement customizable strategies.

Why decentralized options have huge growth opportunities?

“In traditional finance, traders go from spot > leverage > options. Typically, inexperienced traders start with spot, then “graduate” to more advanced forms of trading. In crypto, since there aren’t many experienced traders (yet), the market for options is comparatively smaller. As time goes on, and crypto participants master the art of spot/leverage trading, options are the next logical step for many of these traders. As more experienced investors migrate from traditional finance to crypto in the future, they’ll need places to trade options. Options are needed as they serve as a powerful risk management tool to hedge against existing positions,” Deutscher tweeted.

Potentially promising projects

The largest platform for crypto-options is Deribit, but you can also trade options through other centralized exchanges (CEX), such as Binance, Bybit, etc.

Here are the advantages of trading on a decentralized exchange (DEX) compared to CEX. 

• No KYCKnow your customer — a regulatory term for financial institutions dealing with private money, meaning that they must identify and verify the identity of the counterparty before conducting a financial transaction.;
• No counterparty risk;
• Safety;
• Sovereignty.

This explains the growth of users on decentralized cryptocurrency trading platforms such as $DYDX, $GMX, and $GNS.

1) Dopex (DPX)

• Market cap: $68 million.

Dopex is a decentralized options exchange that allows users to trade options through its vaults. Atlantics is a revolutionary innovation of the team. 

2/ $DPX@dopex_io is a decentralised options exchange on Arbitrum.

Options are a category of derivatives that give the holder the right, but not the obligation to buy or sell the underlying asset.

Dopex facilitates the decentralised trading of crypto-specific options.

— Miles Deutscher (@milesdeutscher) August 17, 2022

2) Hegic (HEGIC)

• Market cap: $19 million.

Hegic is a decentralized protocol that allows users to purchase calls and put options on $ETH and $BTC. They recently launched on Arbitrum.  HEGIC bettors earn a commission on settlements with option buyers.

3) Premia (PREMIA)

• Market cap: $11 million.

Premia allows you to trade call/put options on various tokens. It has a user-friendly interface and 80% of the commissions are paid to $xPREMIA stakeholders.

An ELI5 introduction🧵to @PremiaFinance. Most are betting this to be a small-cap gem on Aribtrum, $PREMIA mc is $15m~ & FDV is $144m~ as of writing, v3 is going to ship soon with 7/9 core components rdy + newly revised tokenomics from xPREMIA to vePREMIA, both coming soon in Q4 pic.twitter.com/ALvZEOq7a3

— TheBabylonians 🌴 (@The_Babylonians) September 13, 2022

4) Jones DAO (JONES)

• Market cap: $6.4 million.

Jones DAO offers vaults for easy, one-click access to educational options strategies.

Arbitrum season is coming

One project is gaining awareness fast: @DAOJonesOptions

What makes $JONES special👇🧵 pic.twitter.com/F7dbQIb4lh

— Corleone (@corleonescrypto) September 8, 2022

5) Lyra (LYRA)

• Market cap: $30 million.

One of the leaders in decentralized options, Lyra uses synthesizers to trade options at AMM prices. 

The Lyra Ecosystem is growing🌱

Let’s look at four powerful protocols that use Lyra options as part of their product suite:

– @PolynomialFi
– @BrahmaFi
– @torosfinance
– @dHedgeOrg

🧵↓ pic.twitter.com/lBQvhrKfR4

— Lyra (@lyrafinance) October 18, 2022