🤔🧐 What are "Perp DEX"
👉🏻 First, let's remember what Perp DEX means:
“Perp” comes from perpetual contracts, which allow traders to take leveraged positions without an expiration date. They are derivatives widely used in futures trading.
A “DEX perp” is a decentralized exchange that allows trading these contracts on-chain, without relying on a centralized counterparty, using schemes like AMM, vAMM, order books, rollups, etc.
👉🏻 The 'race' of the Perp DEX
It seems we are in the middle of a 'race' between multiple projects to see who leads this space. Some of the most important aspects in this competition:
1️⃣ Trading volume: who achieves the most trading volume in these perpetual contracts.
2️⃣ Deep liquidity: having many traders and good liquidity reduces slippage, improves prices, attracts more users.
3️⃣ Low fees and good user experience: low fees, good interface design, transaction speed, interoperability between chains, etc.
4️⃣ Incentives/user campaigns: rewards for using the platform, trading competitions, token drops, staking/locking mechanisms for active users.
5️⃣ Technical innovations: use of rollups, L1/EVM compatibility, low latency, central limit order book (CLOB), gasless trading solutions, among others.
🔷 Some examples of relevant projects
These are some projects that capture important parts of what we could include within what you call the 'Perp DEX Race':
🔹Hyperliquid: one of the leaders in this category, with high volume, market attention, token close to launching or recently launched, etc.
🔹Aster DEX: built on BNB Chain, a strong proposal as a competitor to Hyperliquid.
🔹SunPerp: project launched by Justin Sun, with low fees, 'Trade to Earn' model among other incentives.
🔹edgeX: already generating notable income, capturing volume, being considered one of the 'dark horses' in the space.
⚠️ Risks and what to look out for
🔹Some new projects promise a lot, but they may take time to deliver in terms of real liquidity or user experience.
🔹Incentives can be large at the beginning, but if the economic model is not sustainable, there may be a drop in interest, liquidity, etc.
🔹Regulations could affect derivative projects in different jurisdictions.
🔹Risk of using poorly audited platforms or those with security issues.
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