Three Reasons I Am Not Optimistic About Lighter
Recently, the Lighter project has often been mentioned by some industry friends and influencers, but I am not optimistic about Lighter. The reasons are as follows:
1. Relying solely on zk technology cannot create a Prep DEX unicorn; Lighter has the risk of user private key leakage.
2. The project has been operating for two years without much progress, trying to catch the wave of Prep DEX again by leveraging the label of the next Hyperliquid, while the PUA community is contributing trading data and continues to seek resources and endorsements.
3. The founder is using the funds from the previous project to finance the current project; they are a star entrepreneur but may not have the vision for Crypto airdrops.
About the Narrative and Logic
The main narrative of Lighter is that it has identified several pain points in the decentralized derivatives sector and is attempting to solve these pain points through technological innovation to achieve success. For example, Lighter believes that zk technology can enable scalable, low-latency, secure, and trustless matching and clearing mechanisms.
We believe that in the decentralized derivatives space, relying solely on product and technological innovation makes it very difficult to create a unicorn. The core competitiveness lies in the founder's strong market-making ability and resource integration capability (having the capital to drive the market).
For instance, Hyperliquid's core capability is its strong market-making ability and the wealth effect it creates. In contrast, GMX quickly went silent after being unable to drive the market. Similar decentralized derivatives utilizing zk technology, such as @derivio_xyz and @grvt_io, each have their unique characteristics in product technology, but this does not mean that market breakthroughs can be achieved solely through technology.
It is worth noting that several influencers have posted pointing out that Lighter's technical capabilities are very amateurish, and the documentation seems to be done by a makeshift team. Additionally, the API signing is completely a black box, requiring the private key of the wallet to be shared in order to sign, which poses significant risks.
About Project Progress
Lighter began operations in early 2023, initially deploying on Arbitrum, benchmarking against GMX; it has been around for about two years, and the Twitter and community have been inactive for almost two years without operations or updates.
