On this page (8 sections)
Who should skip this?
Skip GMX perps if you have not used a wallet on Arbitrum, you cannot explain funding and liquidation in one sentence, or you need a CEX with customer support. Perps can wipe the margin. Start with a spot swap guide, not with leverage.
- You have never bridged to Arbitrum or paid an L2 gas fee
- You cannot afford to lose the entire margin
- You wanted Uniswap-style spot, not a leveraged future
Should you trade perps on GMX?
Only if you already know what a liquidation price is and you can lose the margin without changing your life. GMX lets you long or short majors on Arbitrum and Avalanche against pool liquidity. It is not a beginner product dressed up as a swap.
Prefer Hyperliquid if you want an order-book feel and the deepest perp DEX volume. Prefer GMX if you are already in the Arbitrum ecosystem and you accept the GM/GLV pool model. Prefer a CEX if you need fiat off-ramps and a help desk. Prefer not trading perps at all if any of those sentences were unclear.
Liquidations are automatic. A 10× long dies if the index moves about 10% against you, plus fees and spread. Start at 2–3× on ETH or BTC, never on a thin alt, and never with rent money.
What is GMX and how does it work?
GMX is a perpetual futures DEX. You post collateral, choose long or short, and the protocol uses liquidity pools (GM pools for single markets and GLV vaults on V2) as the counterparty instead of a central limit order book. The original V1 pool, GLP, was phased out after a July 2025 exploit and can now only be redeemed. Traders pay or receive funding; pool depositors take the other side of trader PnL and earn fees.
That design is why GMX feels different from Hyperliquid. There is no matching engine of bids and offers in the CEX sense. Execution quality depends on oracle prices and pool inventory. Official app: app.gmx.io (checked August 2026). Confirm the URL; clones ask for token approvals that drain wallets.
| Venue | Model | Typical home chain | Skip when |
|---|---|---|---|
| GMX | Pool / oracle perps | Arbitrum, Avalanche | You wanted a CEX order book |
| Hyperliquid | On-chain order book, own L1 | Hyperliquid L1 | You cannot bridge to that L1 |
| Binance Futures | Custodial order book | Off-chain | You refuse KYC or custody risk |
How do you open a first GMX position?
Bridge a small amount of USDC or ETH to Arbitrum, open the official app, deposit collateral, then place a tiny 2× ETH position you are willing to close the same day. The goal is to see liquidation price and fees, not to make money.
- 01
Get onto Arbitrum
The simplest path is to hold ETH on Arbitrum for gas. Use the official Arbitrum bridge or a reputable alternative; wait for the deposit to show before trading. (GMX also offers Express Trading, which works without holding the gas token, and a GMX Account that can trade Arbitrum markets from Ethereum, Base or BNB Chain without bridging first.)
- 02
Open app.gmx.io
Connect MetaMask or Rabby. Switch the wallet network to Arbitrum One (chain ID 42161). Reject any site that asks you to 'sync wallet' via a seed phrase.
- 03
Deposit collateral
Move USDC or ETH into the GMX account / position collateral as the UI requires. This is not a CEX deposit — it is a smart-contract interaction. Read the spender.
- 04
Quote the trade
Select ETH or BTC, Long or Short, leverage 2–3×, size you can lose. Note entry, fees, and liquidation price. If liquidation is close to spot, reduce size or leverage.
- 05
Close on purpose
Exit with a market or limit close. Withdraw remaining collateral. A first session that ends flat minus fees is a successful drill.
What are GMX's hidden catches?
GMX does not hide a booking fee. The catches are leverage, spread, borrowing/funding costs, oracle-marked liquidation, smart-contract risk, and GM/GLV pool risk if you are the liquidity provider rather than the trader. Smart-contract risk is real: GMX V1 was exploited for about $42M through a reentrancy bug on 9 July 2025 (most funds were returned for a bounty).
Catch 1 — spread and fees eat small scalps. Catch 2 — liquidation is not a polite email; the position is gone. Catch 3 — pool depositors (GM/GLV) earn fees but pay trader profits. Catch 4 — Avax and Arbitrum deployments are different liquidity islands; do not assume one margin covers both.
The verdict: should you use GMX?
Use GMX if you already live on Arbitrum, you can explain liquidation, and you size positions to survive a 5–10% wick. Skip it if you wanted a swap, a savings rate, or a venue that will unwind a mistaken trade for you.
For spot on Arbitrum, use a DEX aggregator or Uniswap. For the highest-volume on-chain order book, compare Hyperliquid. For lending yield without leverage, use the Aave supply guide. Perps are optional; they are never a beginner milestone.
Sources
Primary documentation and data this guide relies on. Links checked .
- GMX — GMX documentation. What GMX is: pool-backed perp DEX on Arbitrum/Avalanche using oracle prices, no order book
- Trading overview — GMX documentation. Steps 'Get onto Arbitrum' and 'Deposit collateral': supported networks, GMX Account, gas
- Fees — GMX documentation. Catch 1: spread and fees eat small scalps; funding and borrow costs
- Liquidations and ADL — GMX documentation. Catch 2: liquidation is automatic and oracle-marked
- Providing liquidity — GMX documentation. Catch 3 and FAQ: GM/GLV depositors take the other side of trader PnL and earn fees
- Liquidity on V1 — GMX documentation. FAQ 'What is GLP?': GLP is discontinued, not a current LP option
- GMX - Rekt — rekt.news. Pool/smart-contract risk: GMX V1 exploit of July 2025
Frequently asked questions
What is GLP?
GLP was GMX V1's liquidity pool token. It was phased out after the July 2025 V1 exploit: V1 trading is disabled and GLP can now only be redeemed. GMX V2's liquidity tokens are GM (single markets) and GLV (vaults across markets). Holders earn a share of trading fees and take the other side of trader profits and losses. Providing liquidity is not the same as opening a perp, and it is not a stable yield.
GMX vs Hyperliquid?
Hyperliquid is a custom L1 with an order book and, in 2026, the larger perp DEX volume. GMX runs on Arbitrum and Avalanche with a pool model. Choose on execution style and which chain you already use — not on branding.
Does GMX require KYC?
No. It is a non-custodial protocol. That also means no help desk will reverse a liquidation. A CEX is the honest choice if you need that.
Can I lose more than I deposit?
Isolated-style perp UIs aim to limit loss to the margin, but fees, spread and liquidations can take that entire margin quickly. Never assume a 'max loss' until you have read the position's liquidation price.