dYdX Restrictions: What You Can and Can't Do on the Decentralized Exchange

When you trade on dYdX, a leading decentralized exchange for perpetual futures and margin trading. It's known for high leverage, low fees, and non-custodial control — but since 2022, dYdX Chain has faced growing legal pressure that reshaped who can use it and how. These aren't just technical limits. They're real-world rules that shut down access for millions, especially in the U.S.

One of the biggest changes came when dYdX stopped allowing new users from the United States to open accounts. Existing U.S. users were given a grace period to close positions, but now they can't open new trades. That’s not because the platform broke — it’s because regulators like the CFTC started treating perpetual swaps as securities. dYdX didn’t want to become a licensed broker. So it chose to pull back instead. This move affected not just retail traders, but also liquidity providers and arbitrage bots that relied on U.S. volume. The platform still operates globally, but if you’re in the U.S., your options are limited to off-chain alternatives or other DEXs like Hyperliquid or Bybit (with KYC).

Other restrictions followed. dYdX removed support for certain stablecoins like USDC on its chain, shifting focus to DAI and other non-U.S.-linked assets. Leverage caps were lowered for some pairs, and withdrawal limits tightened for accounts flagged by on-chain analytics. These aren’t random changes — they’re direct responses to AML and sanctions enforcement. The platform now actively blocks IPs from sanctioned countries and freezes wallets tied to known mixers or darknet addresses. This level of compliance is unusual for a DeFi protocol, but it’s what kept dYdX from being shut down entirely.

What does this mean for you? If you’re outside the U.S., you still get the full power of dYdX: no KYC, 25x leverage, and direct wallet control. But if you’re in the U.S., you’re locked out — not because you did anything wrong, but because the legal landscape changed faster than DeFi could adapt. The same forces that pushed dYdX to restrict users also pushed other protocols like Uniswap and Curve to add geo-fencing. This isn’t the end of DeFi — it’s the beginning of a new phase where compliance isn’t optional anymore.

Below, you’ll find real posts that break down what happened, how it affects trading, and what alternatives exist. No fluff. No hype. Just facts about what’s blocked, why, and what you can do about it.