Decentralized Exchange dYdX (DYDX) Discontinued Its new $25 deposit promotion cites “overwhelming demand” and denies claims that DEXs now require user verification.
Due to overwhelming demand for our $25 deposit bonus promotion, we are closing the promotion. Thanks to the thousands of new users who joined dYdX today. I really underestimated the amount of interest the campaign garnered.
— dYdX (@dYdX) September 1, 2022
DEX drew the ire of the cryptocurrency community after requiring participants of its $25 deposit bonus to perform a “liveness check” that scanned users’ faces.
dYdX does not require users to provide personal information. We recently launched a promotion that awards $25 to new users when they make a qualifying deposit. Participation in promotions is completely voluntary and image verification is required solely to prevent fraud.
— dYdX (@dYdX) September 1, 2022
According to dYdX, the facial recognition request is meant to prevent fraud and does not imply “a change in ideological beliefs regarding accessibility, transparency, mutability, or censorship.”
Crypto Community Attacks dYdX
Many within the crypto community believe that the decision to halt the promotion was due to the initial backlash the exchange received.
Some crypto industry stakeholders have responded negatively to dYdX’s request, with some suggesting that the exchange is acting in accordance with regulatory instructions.
In fact, it’s silly to assume that cryptocurrency exchanges paying people to scan their faces is for any reason.
— Chris Blec (@ChrisBlec) September 1, 2022
1 user explained A $25 bonus is “an insultingly small amount that people pay to expose themselves.”
$25 is an insultingly small amount that people pay to expose themselves. I don’t think your values are aligned with your user base. Please do better.
— tomato.eth (@thefaketomato) September 1, 2022
dYdX Growth Executive Corey Miller said, “There is no good decentralized identity solution that exists today,” adding that there will always be “trade-offs” if DEXs want to be “as big as CEX.” .
The bigger problem here is the lack of good decentralized identity solutions that currently exist.It’s a huge market and I look forward to creating better tools in the future
— Corey Miller (@coreyj_miller) September 1, 2022
On the other hand, Adams Cochran said DEX “has a legal basis to justify some blocks, but collecting biometrics is never acceptable.”
1/8
very disappointed to see $DyDx go down this road.
There were some legal grounds justifying some blocks, but collecting biometrics is never acceptable. pic.twitter.com/OcHnbCw8Cp
— Adam Cochran (adamscochran.eth) (@adamscochran) September 1, 2022
Others shared a similar view, describing it as a bad idea.The paranoia in the cryptocurrency community has arisen in light of recent sanctions against Tornado Cash by the US Treasury Department.
DEX’s native token, DYDX, is up 1.5% over the past 24 hours, trading at $1.53 at the time of writing.
