@Dolomite $DOLO and the potential to become a 'Perp DEX Aggregator' for Margin Trading
1. Context: Perp DEX Aggregator trends
In DeFi, Perpetual DEX Aggregators have emerged to address a key issue: fragmented liquidity across various decentralized derivatives exchanges like dYdX, GMX, Hyperliquid, or ApolloX. Aggregators provide a 'meta-layer', enabling users to trade with low slippage, leverage deep liquidity, and receive optimal quotes. This is particularly important for leveraged products, where small spreads can make a significant difference.
2. @Dolomite $DOLO : current mechanism
Dolomite was originally designed as a composable lending & margin protocol. With cross-margin, isolated pools, and the ability to integrate multiple protocols, Dolomite creates a flexible environment for margin trading. Unlike traditional perp DEX, Dolomite does not operate its own order book or derivative AMM, but focuses on the infrastructure for lending – collateral – margin. This enables Dolomite to play a more foundational role rather than being the final destination for trading.
3. Ability to become a margin trading aggregator
If the narrative of 'Perp DEX Aggregator' is aimed at perp contracts, then Dolomite could become a form of 'Margin Trading Aggregator' with the following advantages:
Common lending and margin layer: allows users to use the same collateral asset to open positions on different DEXs.
Composability: Dolomite can directly connect with perp DEX, stablecoin protocol, or spot DEX, transforming itself into a 'margin router' rather than just a lending pool.
Capital optimization: cross-margin allows for higher capital efficiency than an aggregator that simply pools liquidity.
4. Challenge
To truly become an aggregator, Dolomite needs:Powerful routing engine: similar to 1inch for spot, requires a mechanism to find the best route among multiple perp DEX.
Systemic risk management: linking multiple DEX increases the risk of cascading liquidation.
Scalability: margin trading aggregators require optimal processing speed and gas costs, more suitable for L2 like Arbitrum.
5. Conclusion
@Dolomite $DOLO has the potential to expand from lending protocol to aggregator for margin trading, but to achieve this, they need to develop a 'routing layer' and cross-chain risk management. If successful, Dolomite will not only be a DeFi lending protocol but also a strategic bridge between capital, collateral, and derivative DEX – a new step forward in the narrative of Perp DEX Aggregator.
