DEFI DERIVATIVES: EVERYTHING YOU NEED TO KNOW

Summary from the TLDR Crypto newsletter

DeFi derivatives platforms have seen a 100x surge in TVL since dYdX's 2020 launch and GMX's 2021 debut. This guide unpacks perpetuals fundamentals like leveraged exposure, funding‐rate mechanics, and delta‐neutral strategies, contrasts decentralized orderbook (DCLOB) vs “house” AMM ((X)LP) models, and explains margin requirements, liquidation engines, and oracle-driven price discovery. It also explores liquidity bootstrapping hurdles, the “middling trap” of migrating from in-protocol pools to market‐maker orderbooks, and the varied clearing, execution, and cross-margin designs across platforms.