Permissioned Keys introduce a new standard of security, control, and risk management for API traders, empowering institutions and market makers to operate with greater confidence on dYdX.
This feature is particularly valuable for teams that require shared account access while maintaining distinct permission levels. For instance, an institution can grant a junior trader access to execute trades in specific markets while restricting their ability to withdraw funds, ensuring tighter control over account security.
How Permissioned Keys Work
Permissioned Keys function as an advanced authentication mechanism within the dYdX protocol, offering institutions a structured approach to managing access and permissions. Smart accounts operate with distinct authorization rules, granting API users the ability to implement predefined conditions for transaction approvals and account activity.
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This feature enables traders to:
- Limit withdrawals and transfers to prevent unauthorized fund movements.
- Assign multiple trading keys under a single account to enhance operational flexibility.
- Whitelist specific trading pairs, ensuring activity is restricted to approved assets (e.g., BTC/ETH, not DOGE).
- Manage subaccount permissions, restricting trading to designated accounts while preventing activity on others.
By providing granular control over account operations, Permissioned Keys allow market makers and institutional traders to reinforce security measures while maintaining the efficiency required for programmatic execution strategies.
Designed for Institutional and Programmatic Trading
Permissioned Keys are currently available only for API-based trading and are especially beneficial for:
- Market makers seeking stricter risk management through predefined permissions.
- Institutional traders operating multiple accounts with controlled access.
- Algorithmic traders optimizing programmatic execution while enforcing security protocols.
API traders can now access a structured authentication model that enhances access control, fund security, and risk mitigation—at no extra cost.
Limitations and Future Considerations
While Permissioned Keys offer substantial improvements in security and access control, some limitations remain. The feature does not currently support:
- Trading size limitations due to unfilled orders.
- Leverage restrictions, requiring external risk management strategies.
Future iterations of the open source software may introduce additional functionalities, further improving risk management and account control mechanisms for institutional users.
Implementation and Technical Resources
Traders and institutions looking to implement this feature can reference the technical documentation for integration details:
Permissioned Keys Technical Documentation
And check out the example implementations on Github.
The dYdX VIP team would also be delighted to assist you with the setup. You can reach them at vip@dydx.foundation or via Telegram at @dydxfoundation_admin
For a brief overview, check out the explainer video linked below, which covers the key use cases and limitations of Permissioned Keys:
Watch the Permissioned Keys Explainer Video
Permissioned Keys mark a significant advancement in institutional trading security on dYdX, reinforcing programmatic trading with enhanced access control and risk mitigation measures.
About the dYdX Foundation
Legitimacy and Disclaimer
Crypto-assets can be highly volatile and trading crypto-assets involves risk of loss, particularly when using leverage. Investment into crypto-assets may not be regulated and may not be adequate for retail investors. Do your own research and due diligence before engaging in any activity involving crypto-assets.
dYdX is a decentralised, disintermediated and permissionless protocol, and is not available in the U.S. or to U.S. persons as well as in other restricted jurisdictions. The dYdX Foundation does not operate or participate in the operation of any component of the dYdX Chain's infrastructure.
The dYdX Foundation’s purpose is to support the current implementation and any future implementations of the dYdX protocol and to foster community-driven growth in the dYdX ecosystem.
The dYdX Chain software (including dYdX Unlimited) is open-source software to be used or implemented by any party in accordance with the applicable license. At no time should the dYdX Chain and/or its software or related components (including dYdX Unlimited) be deemed to be a product or service provided or made available in any way by the dYdX Foundation. Interactions with the dYdX Chain software (including dYdX Unlimited) or any implementation thereof are permissionless and disintermediated, subject to the terms of the applicable licenses and code. Users who interact with the dYdX Chain software, i ncluding dYdX Unlimited (or any implementations thereof) will not be interacting with the dYdX Foundation in any way whatsoever. The dYdX Foundation does not make any representations, warranties or covenants in connection with the dYdX Chain software (or any implementations and/or components thereof, including dYdX Unlimited), including (without limitation) with regard to their technical properties or performance, as well as their actual or potential usefulness or suitability for any particular purpose, and users agree to rely on the dYdX Chain software (or any implementations and/or components thereof, including dYdX Unlimited) “AS IS, WHERE IS”.
Nothing in this post should be used or considered as legal, financial, tax, or any other advice, nor as an instruction or invitation to act by anyone. Users should conduct their own research and due diligence before making any decisions. The dYdX Foundation may alter or update any information in this post in the future at its sole discretion and assumes no obligation to publicly disclose any such change. This post is solely based on the information available to the dYdX Foundation at the time it was published and should only be read and taken into consideration at the time it was published and on the basis of the circumstances that surrounded it. The dYdX Foundation makes no guarantees of future performance and is under no obligation to undertake any of the activities contemplated herein.
Depositing into the MegaVault carries risks. Do your own research and make sure to understand the risks before depositing funds. MegaVault returns are not guaranteed and may fluctuate over time depending on multiple factors. MegaVault returns may be negative and you may lose your entire investment.The dYdX Foundation does not operate or has control over the MegaVault and has not been involved in the development, deployment and operation of any component of the dYdX Unlimited software (including the MegaVault).
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