Perpetual Protocol PERP / Perpetual Protocol

What Is Perpetual Protocol (PERP)?

Perpetual Protocol is a decentralized exchange (DEX) for futures on Ethereum and xDai. Traders can go long or short with up to 10X leverage on a growing number of assets like BTC, ETH, DOT, SNX, YFI and others. Trading is non-custodial, meaning traders always retain possession of their assets, and on-chain. Perpetual Protocol utilizes a virtual automated market maker (vAMM), which provides on-chain liquidity with predictable pricing set by constant product curves. Furthermore, Perpetual Protocol designed its vAMMs to be market-neutral and fully collateralized.

The declared vision of Perpetual Protocol is to create the world’s best, most accessible, and most secure decentralized derivatives trading platform. By building on our DeFi projects and allowing projects to build on Perpetual Protocol, the company embraces the “DeFi money lego” ethos. After hitting a number of milestones in its roadmap, such as launching staking pools and implementing limit and stop-orders, Perpetual Protocol plans to expand to other chains, introduce leveraged tokens, and launch dynamic liquidity in its pools.

Who Are the Founders of Perpetual Protocol?

Perpetual Protocol was launched by Yenfen Weng and Shao-Kang Lee, two Taiwanese cryptocurrency entrepreneurs that previously had launched payroll & accounting companies for crypto startups. Most of the team is based in Taiwan. Perpetual Protocol is backed by many highly reputable investors, such as Zee Prime Capital, Multiarrows Capital, CMS Holdings, Binance Labs and Alameda Research, a strategic partner of FTX. With their backing, the company closed a Multicoin Capital-led seed round for $1.8M in 2020.

What Makes Perpetual Protocol Unique?

The goal of Perpetual Protocol is to create a perpetual contracts trading platform that anyone can use. To do that, users need to be able to trade with good liquidity and low slippage. Perpetual Protocol solves this by employing its vAMM solution. Perpetual Protocol doesn’t follow the usual order book model of centralized exchanges. Instead, traders trade against a virtual automated market maker, whose initial liquidity is set by the operator.

For instance, assume the operator sets the vAMM’s liquidity at 100 vETH to 40,000 vDAI. Someone depositing DAI to go long on ETH would tilt the price of ETH upwards and create an incentive to go short on vETH if the price is out of line with market prices.