😇Introduction
$60 +Trillion Dollar Market
The cumulative trading volume of perpetual contracts since 2020 has surpassed $60 trillion, which is much higher than the trading volume of the underlying cryptocurrencies and conventional futures contracts Read More. For A primer on how perpetual contracts work and what is option trading please look into this
The Problems
Open Order Books: Challenges in Perpetual Markets
Perpetual markets with open order books provide transparency, but they also come with significant challenges:
Front Running: Traders can exploit the visibility of pending orders, executing trades before others, taking advantage of transaction ordering.
Copy Trading Exploitation: Similarly, the visibility of trades allows competitors to duplicate strategies and profit unfairly.
Lack of Privacy: Open order books expose traders’ strategies and positions, allowing market analysis to be exploited by competitors.
Market Manipulation: Open order books can be gamed by actors who use this transparency to manipulate markets and liquidity.
Private Order Books: A Double-Edged Sword
Private order books come with their own set of problems:
Trust Deficit: Users cannot verify the platform’s financial solvency, leading to doubts about whether enough assets back the open positions.
Hidden Liquidity: With no visibility into the market depth, traders face uncertainty about whether their orders will be executed, or at what price.
Manipulation Risk: The platform or privileged users can manipulate the market without detection, undermining the integrity of the system.
User Trust: Lack of transparency can cause users to question the platform’s stability, especially during volatile periods, driving away both new and existing users.
How we solve the Problem
We address these issues by adopting a private order book system enhanced with access proofs and proof of solvency to foster user trust. While part of the market data remains public to prevent a “gambling-like” environment, the core of the system ensures that transparency and trust are maintained in a decentralized manner.
Our approach is powered by a Chain Abstracted DAO, enabling users to propose and vote on changes to the perpetual contracts and platform structure. This cross-chain voting architecture ensures that all stakeholders have a say in the platform's evolution, adding further trust and transparency to the ecosystem.
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Partners
In the partners section we go over how we bring value to the partners and how they are crucial for our Application.
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