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GMX Review

GMX Review

Adrian Graham
Fact Checked
Sep 5, 2022

Summary: GMX is the largest decentralized perpetual futures exchange that allows users to trade BTC, ETH, AVAX, UNI and other cryptos with up to 30x leverage. Their platform is no-KYC and you can connect to it directly with a MetaMask Wallet on the Arbitrum and Avalanche networks.

The GMX platform has gained significant traction in 2022 due its GMX Rewards Program. This allows users to earn up to 30% APY in protocol rewards from trading revenues if they buy and stake the GLP token, which is a basket of all of the tradable tokens on GMX.

Table of Contents

GMX Platform Review

Platform Highlights

  • Largest decentralized exchange on Arbitrum and Avalanche.
  • Earn up to 30% APR by providing liquidity to GLP (revenue share).
  • Highly secure and audited platform with over $375m in value locked.

What is GMX?

GMX is a decentralized spot and perpetual exchange that is deployed on the Arbitrum Layer 2 and Avalanche C Chain networks. It was founded by anonymous developers that are reported to be based in Sydney, Australia. The GMX trading platform is the largest in DeFi with nearly $60 billion in total trading volume and over $80 million in daily open interest.

GMX Review
GMX: Largest DEX Perpetual Protocol on AVAX and Arbitrum.

What markets does GMX offer?

The GMX trading platform offers different cryptocurrencies depending on the network you use. For the Avalanche ecosystem, GMX currently allows for up to 30x leverage cross-margin on AVAX, ETH, USDT, BTC and BTC.b (bridged BTC).

For Arbitrum, GMX allows users to trade ETH, BTC, USDC, USDT, FRAX, DAI LINK and UNI with up to 30x leverage. The team has announced that they will continue to release more tokens on both networks as the product continues to grow and find product-market fit.

GMX Arbitrum
Trading the ETH/USD pair on GMX Arbitrum.

What is GLP on GMX?

GLP is a token that consists of an index of all tokens available on an individual network. For example, on Arbitrum the GLP token is an equally weighted basket of ETH, BTC, LINK, UNI, USDC, TETHER, DAI and FRAX. When users buy the GLP token, they are essentially providing liquidity for users to trade with low fees, and are rewarded for doing so.

On Arbitrum, users are currently being paid a 27.70% APR to hold the GLP token which is paid out in ETH from platform revenue fees. The GMX rewards on Avalanche are slightly lower and are currently 22.36% with a payout in the native AVAX token. You can learn more about GLP in the GMX docs.

Is GMX safe?

The GMX team is completely anonymous, which means that all users should proceed with caution. That said, the protocol has amassed over $375m in total value locked, which means that it is trusted by high-net-worth and institutional investors. The platform has also been extensively audited by ABDK Consulting, you can find the full audit on the GMX Github.

GMX Crypto Tokenomics

GMX has revolutionized tokenomics for decentralized trading platforms and is one of the key reasons they overtook competitors like DYDX and Perpetual Protocol. The token currently serves as the platforms utility and governance token, while unlocking value through staking where investors receive:

  • 13% APR paid in GMX that is escrowed for 1 year to incentivise long-term holders.
  • Multiplier points (the longer you stake, the higher your rewards).
  • ETH and AVAX rewards paid out as a percentage of revenue.

As an example, the GMX Earn and crypto staking program on Arbitrum currently pays out 13.35% APR. This is split into 7.47% paid in Escrowed GMX and 5.88% paid in ETH tokens.

GMX Arbitrum vs GMX Avalanche

The GMX Arbitrum platform is better than the Avalanche version because it offers more trading pairs, higher rewards and cheaper fees. Another reason our team prefers GMX Arbitrum over GMX Avalanche is that rewards are paid out in Ethereum (ETH) as opposed to Avalanche (AVAX) which has typically underperformed.

You can compare the live data differential between GMX Arbitrum and GMX Avalanche on GMX Stats.

GMX Arbitrum vs GMX Avalanche
Compare AVAX vs Arbitrum on stats.gmx.io analytics.

GMX Referrals

GMX offers a leading referral program for crypto that allows users to get fee discounts and earn rebates when customers sign up using their link. To set it up, all you need to do is:

  • Visit GMX Referrals
  • Click on the Affiliates tab and connect your MetaMask or web 3 wallet.
  • Create your custom referral code and start using it straight away.

Rewards to referrers in this program are paid out every Wednesday in Ethereum (ETH) for Arbitrum users and Avalanche (AVAX) for AVAX users.

Final Thoughts

Overall, GMX is one of the most innovative and exciting products in Decentralized Finance. They offer a fast, smooth and deeply liquid trading experience that is fully on-chain on Ethereum's leading Layer 2 Arbitrum and Avalanche.

The GLP token is also a great investment strategy for DeFi natives looking to get broad market or index exposure and earn yield at the same time. This is the preferred strategy of many top investors associated with the project like Arthur Hayes, Taiki Maeda and CryptoMessiah (CryptoMessi).

Adrian Graham

Co-Founder & former banker turned Full-Time DeFi analyst and researcher. Left traditional finance to pursue my interest in digital assets and decentralized finance.

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