Is Arkham also going to launch a Perp DEX? On November 6th, $ARKM, influenced by the news of "Arkham's upcoming launch of its derivative trading platform," surged to break through $2.1 in a short period, with a 24-hour increase of over 20%. Arkham itself does not come from a Defi background; the project's initial positioning was an on-chain artificial intelligence analysis tool. Arkham uses artificial intelligence to collect, categorize, and display a large amount of on-chain data through the Arkham dashboard, providing data that was previously only available to blockchain analysts and enthusiasts, thus increasing on-chain data transparency. It is important to note that Arkham's newly announced perpetuals exchange and Arkham Intel exchange, although both are exchanges, are entirely different.

AI seems to be a versatile disguise, fitting in anywhere. While Arkham's entry into the DeFi track relying on an AI data platform undoubtedly has its natural advantages, why the transformation into Perp?

Why Is Everyone Flocking to Perp?

On the one hand, market liquidity has shifted from centralized exchanges like CEX to on-chain. Retail investors holding listed altcoins are still trapped, while on-chain has truly begun the season of altcoins. The altcoins on exchanges are still going "hundred times in the opposite direction,” even though Bitcoin has reached a new high of $75,000. Meanwhile, meme coins native to Sol like NEIRO, MOODENG, and GOAT are constantly emerging, with even powerhouse Binance having to consecutively list these on-chain native meme coins. Where there is a wealth creation effect, there is liquidity.

On the other hand, CEXs not only have slow listings and trading restrictions in different regions but most importantly have listed a series of "VC coins" with severely unfair chip structures. Not long ago, the CEO of cryptocurrency investment advisory firm Moonrock Capital voiced out on Twitter, stating, "Binance demanded that a potential project provide 15% of its total token supply to ensure its listing on the centralized exchange, which accounts for 15% of the token's total supply, valued at approximately $50-100 million." Thus, various key opinion leaders (KOLs) on Twitter initiated discussions on listing fees.

Setting aside listing fees, in the eyes of the vast majority of retail investors, a vicious cycle of "VC-project team-CEX" collusion, listing and dumping, and retail investor entrapment has formed. Therefore, compared to the stagnation of secondary listing tokens, users are forced to embrace on-chain solutions, where at least the ecosystem for on-chain retail investors is relatively fair. As the old saying goes, "Fairness, fairness, or still fairness." To some extent, CEX's "reaping what they sowed" has provided space for the growth of these on-chain players.

Who Are the Key Players in the Market

The current Perp DEX landscape seems to be as crowded as the Ethereum L2. In addition to well-known projects such as Dydx, Hyperliquid, Jupiter, there are a dozen or so Perp DEXs barely maintaining signs of life. Due to the lack of liquidity, they have now essentially become tools for speculators' arbitrage. The author will analyze them one by one in order of market share.

Hyperliquid

Hyperliquid stands out among many Perp DEXs and is deservedly the market leader from various data dimensions. Currently, it holds approximately 25% of the entire Perp DEX market share.

Not only did Hyperliquid enhance its trading performance with a solid foundation, but it also introduced the HyperBFT algorithm in May this year to optimize it, increasing transaction speeds to the level of 10-20 WTPS. At the same time, Hyperliquid chose to follow the path of building a low-latency, high-throughput Perp DEX application chain.

Moreover, Hyperliquid's operations are very savvy. When Hyperliquid launched its spot trading feature, it airdropped a meme coin called PURR to early platform users. At a time when many CEXs had not yet responded to on-chain meme coins, Hyperliquid had proactively launched the corresponding spot trading.

However, due to not issuing its own cryptocurrency, Hyperliquid has little presence in the Chinese community, with more "value discovery" coming from the English-speaking community.

Jupiter

As a leading DEX aggregator on Solana, Jupiter naturally inherits the abundant traffic on Solana. Jupiter finds the most favorable price route among all major DEXs and AMMs on Solana, minimizing slippage and transaction fees to enhance trading efficiency for users. While Jupiter offers various functions such as spot trading, DCA dollar-cost averaging, and limit order trading, the most popular is still Perp trading. Jupiter's perpetual contract trading supports a significant portion of its fee revenue.

The native token $JUP of Jupiter is also highly welcomed and loved by the community. JUP holders can stake for voting rewards, and JUP has seen significant price gains allowing holders to both stake and take. With its strong fundamentals and community reputation, Jupiter holds around 10% of the market share.

SynFutures V3

SynFutures was initially deployed on Ethereum's Layer2 Blast, but due to Blast's community backlash and ecosystem loss caused by its overly inflated "Pinduoduo" points, in July of this year, SynFutures "relocated" to the Base chain. Currently, SynFutures has become the largest on-chain derivatives exchange on Base. With Bitcoin breaking $80,000, the market is gradually recovering. The trading volume and TVL of SynFutures V3 are also hitting new highs.

On November 6, SynFutures launched the industry's first Perpetual Launchpad focusing on the derivatives market on Base. Projects only need to provide initial liquidity using their project tokens to list corresponding perpetual contract markets. At the same time, SynFutures has established a $1 million Perp Launchpad incentive plan to provide bonus support for emerging projects such as trading competitions, market promotions, and community activities.

Dydx

As a project often talked about in the community, many KOLs initially regarded Dydx as a hundredfold coin at the beginning of the bull market. However, both its fundamental performance and the price of the DYDX token have been disappointing. Therefore, many early players in the community have turned to FUD Dydx, which can be described as "love deeply, blame severely." Dydx's market share barely remains around 6-7%, placing it at the back of the mainstream ranks.

As the first project to run in the Perp DEX, Dydx peaked in TVL in 2022, approaching nearly $1.2 billion. However, it faltered as the market entered a deep bear market, and not even during the mid-2024 mini bull did it shine again. Even in the current scenario of the hot on-chain market, its TVL continues to decline. Only when announcing a pump did the DYDX token barely enjoy a 20% price increase to capture this wave of meme dividends. On October 10, dydx founder Antonio Juliano announced his return and reassumed the role of dYdX CEO, followed by restructuring efforts. The market also anticipates the founder's return and reform to lead dydx out of its current predicament.

Arkham

The Arkham Perpetuals Exchange will provide users with 0 fee Maker spot and contract trading and reduce fees for Market trading based on their $ARKM holdings and trading volume. Users opting to pay fees using ARKM will receive a 25% fee discount. Users can earn points by trading on the Arkham Perpetuals Exchange. VIP users who open an account will see a 10% increase in total points, and these points remain valid on the Arkham Intel Exchange.

However, Arkham's approach to perpetuals operation is no different from other perpetuals' beginnings. The initial users are attracted through points or fee discounts, but these users merely use the perp DEX as a mining tool and do not represent genuine trading volume. Let's take a look at Aevo, the perp DEX that shone in March this year.

After announcing its airdrop rules in March, Aevo's TVL and trading volume peaked. Subsequently, TVL continued to decline, and trading volume plummeted on a weekly basis, with actual trading volume dropping by 80% within a month. From a data perspective, most of the users participating in trading on Aevo were on-chain "free riders," with few genuine users. Once the allure of the token airdrop faded, the inflated trading volume data was harshly exposed by the market. Ironically, its token price also plummeted by nearly 90% post-airdrop.

While point schemes and fee reductions can attract a large number of users to the platform in its early stages, the real test Arkham Perp faces next is how to retain genuine users through "real products" and "real business" after the end of this "mining-like" activity, avoiding the steep declines seen in all metrics that Aevo suffered.

How is the current perp market?

Although Perp DEX has been innovating its product offerings, including spot, lending, betting, per-launch, and liquidity design involving orderbooks and auctions, as well as focusing on UI and memes, the perp DEX journey has not been entirely smooth. Even the leading player, Hyperliquid, struggles to compete with Binance. According to Dune data, Hyperliquid's trading volume is only 1/9 of Binance's spot trading volume.

In today's decentralized perpetual contract arena, almost every L1, L2 chain will support its own Perp DEX in order to complete the "DeFi suite."

However, the decentralization of public chains brings about liquidity fragmentation. In a divided environment, there can be no complete solution. This is true for public chains and also for Perp. Decentralized liquidity is difficult to scale, and if cross-chain liquidity interoperability can be achieved, then Perp can enjoy abundant liquidity like a CEX. At that time, the entire Perp DEX market will truly take the lead. The multi-chain universe's structure, like a chain of iron links, limits the ceiling of Perp's development.

On the other hand, the audience of Perp DEX is mostly risk-takers. Compared to CEX, Perp's advantages lie in fast listing, abundant assets, and flexible products, making it naturally attractive to high-risk speculative investors. Therefore, the audience for Perp is inherently smaller than the target audience of CEX. Furthermore, centralized exchanges such as OKX, Bybit, Bitget, etc., are also continuously entering the pre-market niche market, competing with Perp DEX for market share. On the road to claiming the CEX throne and competing for market dominance, Perp DEX still has a long way to go.

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