dYdX’s new Builder Codes feature might sound like a backend tool meant only for developers. And yes, technically, it is. But its impact goes beyond just the code. For instance, if you are building a wallet, a Telegram bot, or a trading app that routes orders to dYdX, this update can quietly make your project more sustainable. It offers a native way to earn straight from order flow, without requiring any tracking systems or manual approvals. This quick guide explores how.
KEY TAKEAWAYS
➤ dYdX’s Builder Codes let developers earn directly from trades by embedding a fee and payout address in each order.
➤ Apps, bots, and wallets can integrate dYdX trading without manual approvals, while monetizing transparently on-chain.
➤ This model promotes better tools, localized frontends, and self-custodial trading interfaces built by independent developers.
➤ Every fee is publicly recorded, thereby allowing users to verify who earned what and compare platform charges.
What are Builder Codes on dYdX?
Builder Codes are on-chain tags that developers attach to dYdX trades. The codes allow them to earn a tiny fee whenever those trades execute.
In essence, a Builder Code works like an affiliate code baked directly into the trade itself. Each code consists of two parts: a builder’s wallet address and a fee rate in parts-per-million (ppm) (up to 10,000 ppm, which equals 1%).
When a trade with a Builder Code is filled on dYdX, the protocol automatically routes the specified fee to the builder’s address on-chain.
There’s no need for any manual tracking or separate agreements, as the fee-sharing is enforced by the blockchain itself.
More importantly, any application or developer can use a Builder Code without asking permission. This means wallets, bots, trading terminals, or any front-end can integrate dYdX’s markets and set their own small fee, all in a standardized, transparent way.
dYdX Builder Codes key highlights
- Built-in affiliate fee: They serve as (kind of) on-chain affiliate tags for trades. They embed a payout address and fee into each order. Once the order executes, the builder (affiliate) automatically gets paid a portion of the trading fee.
- Two-line addition: Technically, it is just two extra fields in the order message, including a builder’s address and a fee rate (ppm). This tiny snippet in the trade request tells the dYdX protocol how to split the fee.
- Automatic on-chain payout: The protocol “skims” the builder’s cut on-chain and sends it directly to their address once your trade is filled.
- No permission needed: Unlike traditional referral programs, there’s no approval or whitelist required to use a Builder Code. Any developer can start routing orders through dYdX and earning fees, simply by including their code.
- Transparent and capped: The builder’s fee is capped at 1% of the trade (10,000 ppm) to protect users from excessive charges. Every fee and its recipient are visible on-chain, so nothing is hidden (more on this transparency later).
How do Builder Codes encourage better apps?
Put simply, they give developers a native, automatic revenue stream, which motivates them to build higher-quality trading apps and tools for you.
Broadly speaking, a good chunk of decentralized app developers tend to struggle to earn money for their work. And the fact that traditional crypto affiliate programs are generally clunky, off-chain, and often unreliable, doesn’t help their cause either.
Builder Codes fix these issues by baking monetization right into the platform. Now, if a developer creates a useful trading interface or bot for dYdX, they can earn a tiny fee from every trade made through their app, directly from the protocol.
This built-in reward makes it worthwhile for developers to invest time in better features, user experience, and support, because their earnings scale with your usage of their app.
In other words, the more you and others trade via their tool, the more the developer earns – aligning their incentive to make the app as helpful and user-friendly as possible.
For perspective, let’s consider a few examples of how this can benefit you in practice:
Free or improved trading tools
A developer of a web trading terminal can integrate dYdX and add a 0.5% Builder Code fee instead of charging you a subscription or upfront cost. The tool stays free for you to use, funded by a small fee on trades. You get advanced charts or analytics at no direct cost, and the developer gets paid when you trade — a textbook example of a win-win scenario.
Better wallet experiences
Mobile wallet apps might build in a dYdX trading feature (say, a “Trade” button next to your tokens) because Builder Codes let them earn a few basis points on each trade. This means you can trade perpetual markets right inside your wallet app. And the wallet developers, now with a revenue source, can afford to maintain and improve this feature for you.
Innovative bots and integrations
With Builder Codes, tools such as a Telegram trading bot or a portfolio app can integrate direct trading functionality. They will earn a tiny fee each time you trade through them, which encourages them to keep the service running and add new features (so you benefit from continuous improvements).
Localized platforms
Even regional or niche front-ends can flourish — in theory, at least. For instance, a team could create a dYdX interface in your local language or tailor-made for a specific community. Builder Codes would allow them to monetize usage of that local platform sustainably. As a user, you get an interface that feels custom to your needs, and the builders get funded for providing it.
How do Builder Codes promote transparency in fee attribution?
They make every fee completely visible and traceable, so you can always see what you are being charged and who is getting that fee.
This is a big plus, especially when compared to traditional referral or affiliate setups.
So, with Builder Codes, whenever a builder fee is applied to a dYdX order, that information is recorded on-chain and can be viewed by anyone. For you as a user, this means there are no hidden commissions
So, in a nutshell:
- On-chain record: Once your trade executes, the exact amount paid in fees and the address it went to are logged on the blockchain. It’s kind of like having a public receipt for the fee. If an app tells you it charges a 0.2% fee, you can confirm that by looking at the trade details — the numbers have to match up.
- No opaque kickbacks: In many traditional affiliate models, fee sharing can be opaque. You might not know if part of your trading fee is being kicked back to some referrer behind the scenes. Builder Codes flip this by making fee attribution “fully transparent – every tip is audit-friendly, every route traceable”. You know exactly who earned what.
- Accountability and choice: Because it’s easy to see the fee rates, developers are held accountable. If one app tried to sneak in an unreasonably high fee (up to the 1% cap), users could quickly spot it and likely avoid that service. In practice, builders are incentivized to keep fees fair and compete on user experience, since you can compare what different platforms are charging. The net result is a more honest marketplace of services.
How do Builder Codes compare to traditional affiliate programs?
| Aspect | dYdX Builder Codes | Traditional affiliate programs (centralized/off-chain) |
| Participation | Open to anyone. No permissions or approval needed to become a builder. Any app can start earning by adding a code. | Typically requires approval or partnership. You often must apply, and the company decides who can be an affiliate. |
| Integration | Integrated into the order on-chain. Two fields (address & fee) in the trade message handle the affiliate info. No separate tracking systems. | External tracking via referral links or codes. Trades are tracked off-chain by the platform’s database, not built into the trade itself. |
| Fee enforcement | Protocol-enforced split: the blockchain automatically pays the builder their share when a trade fills. No manual intervention, errors, or delays. | Platform-enforced: the exchange tallies referred trades and later distributes a commission. Payouts might happen weekly or monthly. |
| Transparency | Fully transparent. The builder’s address and fee rate are recorded on-chain for each order. Anyone can verify who received what. | Mostly opaque. Users might not know how fees are split. Affiliates rely on the platform’s reports, and users only see a referral code at best. |
| Fee limits & costs | Fee is capped (max 1% of the trade) by protocol rules. Users see any added fee and can choose services accordingly. | Fee share percentages vary per program (could be higher or lower, as decided by the platform). Users often aren’t directly informed of how much of their fee goes to an affiliate, and there may be no set cap besides what the platform decides. |
| User incentives | Builder fees generally come out of the trade as an extra micro-fee. No direct discounts by default, but users benefit via better services funded by these fees. | Some programs offer kickbacks or discounts to referred users, but this depends on the platform. Otherwise, the benefit to users is not always obvious or guaranteed. |
The impact on end users
So, to cut a long story short, Builder Codes is definitely a behind-the-scenes feature for developers, but they can have a meaningful impact on your overall trading experience. The effect of transparency and more autonomy for developers ultimately flows downstream to you.
That said, it’s still worth checking how much any app charges through its Builder Code. While fees are capped and visible, it’s always smart to compare services and choose tools that balance cost and quality. After all, just because it’s transparent doesn’t necessarily mean every fee will be fair.
Builders can check out the API documentation here and read the blog post here.
Frequently asked questions
What are Builder Codes on dYdX?
Who can use Builder Codes?
How do Builder Codes improve the trading experience for users?
Can Builder Codes be misused to overcharge users?
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