Summary of the 2025 Perp DEX Battle: From Hyperliquid's Dominance to a Fractured Field, 2026 Will Mark the Beginning of True Competition

Introduction: The Essential Changes That Cannot Be Measured by Trading Volume

The on-chain perpetual contract market in 2025 appears on the surface to be a fierce competition for trading volume, but in reality, it reveals a serious “disparity between quality and quantity.”

At the beginning of the year, Hyperliquid dominated over 70% of the market, but in the second half, more than 10 new Perp DEXs entered the scene. By the end of December, Hyperliquid’s market share had fallen to about 20%—a figure that might suggest a “fall of the king.” But the truth is quite different.

Looking at key indicators reveals a different picture

In terms of open interest (OI), Hyperliquid still accounts for approximately 49% of the entire network, about $7.5 billion. This is half of the total OI of the other four platforms combined. In other words, while short-term scalping trading volume has increased, the actual capital inflow is still primarily concentrated in Hyperliquid.

The True Face of the Perp DEX Market: The Reality Behind Data Frenzy

Why Trading Volume Rankings Are Unreliable

In September 2025, Aster rapidly achieved a daily trading volume of $70 billion and was expected to be the “next Hyperliquid.” However, immediately afterward, the data platform DeFiLlama removed Aster, citing “trading data that was fully synchronized with large CEXs and detected significant anomalies.”

On-chain tracking shows that 96% of Aster’s tokens are concentrated in six wallets. Its trading volume/OI ratio reaches 58, meaning the same position is turned over 58 times. Essentially, this is not real capital but a self-sustaining cycle driven by incentives.

Lighter achieved the top trading volume with an even simpler Zero Fee strategy, but the reality is:

• Vol/OI ratio exceeds 8 (normal range is 1-2)
• Users are mainly short-term speculators aiming for airdrop points
• During a downtime in mid-October, LLP’s liquidity pool suffered a 10% loss

In other words, high trading volume no longer indicates platform quality but has become a measure of “incentive strength.”

Truly Valuable Indicators: Revenue and Stability

EdgeX’s monthly fee income exceeds $20 million, annualized about $250 million, ranking second after Hyperliquid. However, EdgeX’s market share in trading volume is only 5-6%, meaning the fee contribution per user is more than 40 times that of Lighter.

What accounts for this difference? The quality of users

EdgeX is an institutional investor platform incubated by Amber Group, with a solid user base and corresponding liquidity support. Paradex is similar, especially trusted by institutional traders.

Calm Analysis of the Five Major Forces in the 2025 Perp DEX Market

Hyperliquid: The Champion’s Position, Unshaken

• Strengths

  • Self-developed chain with a processing capacity of 200,000 transactions per second
  • Front-end comparable to Binance, fully decentralized back-end
  • Establishes a win-win model for funds and platform via HLP (Hyperliquidity Protocol)
  • Zero technical failures, stable even during extreme market conditions in October

• Performance Metrics

  • 24-hour trading volume: consistently between $3 billion and $10 billion
  • Open Interest: 49% of the entire network (~$7.5 billion)
  • BTC perpetual contracts: can hold positions of $5 million within ±0.01%
  • HYPE circulation market cap: about $8.2 billion (ranked 15th among cryptocurrencies)

• Challenges

  • Long-term consensus safety of its self-developed chain remains unverified
  • Increasing competition will inevitably slow the pace of new user acquisition

Lighter: An Ambitious Tech Innovator with Implementation Challenges

• Technology

  • ZK Rollup + StarkWare solutions
  • Each transaction verified cryptographically, ensuring privacy
  • “Escape Pod” mechanism: users can withdraw funds directly to the mainnet if L2 fails

• Business Model Issues

  • Gained top volume with Zero Fee
  • But protocol revenue is nearly zero
  • Revenue model needs re-evaluation after airdrops
  • Simply exchanging capital with the market, with unclear commercial sustainability

• Stability Concerns

  • Mainnet collapsed and experienced downtime within 10 days of launch
  • UI delays and bugs are common
  • Exposed system risks during extreme market conditions

EdgeX: The Quiet but Most Capable

• Business Foundation

  • Incubated by Amber Group (one of the world’s leading market makers)
  • Focused on institutional clients
  • About $500 million annual fee income

• Product Features

  • Low fee rates: 0.012% for limit orders, 0.038% for market orders (industry-leading)
  • Can hold $6 million worth of BTC within ±0.01% (better than Hyperliquid)
  • Emphasizes mobile experience: iOS/Android apps, MPC Wallet integration

• Weaknesses

  • No token issued yet
  • Missed the airdrop frenzy, lagging in brand recognition
  • “Lack of standout features,” resulting in low interest from general users

Aster: Binance’s Hope, Market Disappointment

• Initial Explosion

  • Rose 2800% in one week in September 2025
  • Reached $70 billion in daily trading volume in a short period
  • Market share once exceeded 50%

• Turning Point

  • Removed from DeFiLlama due to data doubts
  • On-chain analysis shows 96% of tokens concentrated in 6 wallets
  • Trust crisis: price plummeted from highs, now around $0.7

• Outlook for 2026

  • Possible market share recovery with Binance’s support
  • But trust wounds are not easily healed

Paradex: Ambition of a Multi-Functional Platform

• Product Differentiation

  • Built on Starknet L2, with an independent “Paradex Network”
  • Unified platform for perpetual futures, perpetual options, and spot trading
  • Supports single account with multiple margin models (staged, overall, portfolio)

• Disciplined Incentives

  • Maintains normal Vol/OI ratio of 1-2
  • No abnormal trading volume spikes
  • Focuses more on long-term value than short-term speculation

• Current Status

  • TVL: about $170 million
  • Daily trading volume: about $2 billion
  • OI: about $770 million
  • Niche but steady growth trajectory

Five Major Risks Facing the Perp DEX Market

1. Expansion of Technical Vulnerabilities

New platforms tend to adopt more complex architectures, increasing the likelihood of vulnerabilities and failures.

Lighter experienced a database collapse immediately after launch. Hyperliquid’s consensus safety has not been validated over the long term. Risks such as smart contract vulnerabilities, matching failures, and oracle price manipulation are unavoidable.

2. Token Economy Explosions

Each platform places its token price as the “lifeline” of its ecosystem.

However, the market is highly volatile. A sharp decline in platform tokens could lead to loss of user motivation and even a “bank run.” If Lighter’s token price falls below expectations, active traders may exit instantly.

3. Lack of Resilience to Extreme Market Fluctuations

On-chain contract markets are still small. During abnormal fluctuations, liquidity may dry up, and slippage could spike sharply.

In the October 11, 2025 crash, $19 billion in positions were liquidated. Some low-risk-tolerance platforms may collapse or face capital shortages.

4. Regulatory Uncertainty

As on-chain derivatives trading volume increases, regulatory scrutiny will intensify.

Many countries prohibit unlicensed platforms from offering high-leverage trading to their users. Despite being decentralized, regulatory pressure could undermine user trust.

5. Widespread Volume Inflation

Aster’s data manipulation allegations are just the beginning. As incentive wars continue, wash trading will persist.

Investors should not be misled by volume rankings but focus on “hard indicators” such as OI, fee income, and user retention.

Outlook for 2026: From “Wild Growth” to “Refined Operations”

Trend 1: Restructuring of Market Architecture

Hyperliquid is likely to maintain leadership with its deep OI foundation.

If Lighter can retain user activity, it could become the biggest challenger in trading volume. EdgeX is expanding its share in institutional markets. Paradex has opportunities to leap from second-tier through product differentiation.

Overall, the market will shift from “one dominant, many weak” to “one surpassing many strong.” Hyperliquid will remain stable at the top, while others carve out their niches in a competitive landscape.

Trend 2: Transition from “Quantity” to “Quality”

The competition based on trading volume rankings in 2025 will give way to core metrics like Vol/OI ratio, fee income, and user retention.

Growth of new users will become more organic. Excessive incentive wars will subside, shifting the focus to improving user experience.

After airdrops, speculators will decrease, and the proportion of traders with genuine demand will rise.

Trend 3: Accelerated Product Diversification

Paradex’s planned perpetual options and spot trading will be a test case. Success could lead others to follow.

Emerging short-term futures and RWA contracts (gold, stock indices, etc.) will appear. Integration of social trading and algorithmic strategies will deepen.

Exchanges will increasingly merge with asset management, evolving from mere “perpetual contract DEXs” to “comprehensive derivatives platforms.”

Trend 4: Shaping Regulatory Frameworks

In 2026, phased regulatory guidance for decentralized derivatives is likely to emerge.

Some platforms may establish “compliance windows” offering regulated versions (referencing dYdX’s precedent).

If Hyperliquid aims to deepen its US market presence, it might consider registering as a derivatives trading platform (SEF).

Maintaining anonymous open entry while opening separate regulatory channels will become the mainstream “two-pronged” strategy.

Trend 5: Pressure from Established CEX Giants

Centralized exchanges cannot remain silent. Gaining share in the decentralized contract market is a strategic necessity.

Some large CEXs are already developing decentralized products. The “centralized + decentralized” dual-service model is becoming the new norm.

Emerging platforms are incubating their own DEXs, challenging existing leaders with on-chain innovations.

While competition accelerates, overall market size and resource inflows will also grow steadily.

Final Note: Three Points Investors Must Not Overlook

1. Trading volume is an indicator of vanity

   • Always verify with OI, fee income, and Vol/OI ratio

2. Technology and business integration is everything

   • High performance alone is not enough. Sustainable revenue models are essential

3. How to handle regulation is a turning point

   • Companies that strategically embrace compliance rather than fear it will become the next leaders

In 2026, the Perp DEX battlefield will prioritize “substance over spectacle.” Only those that do not deceive users, are honest with technology, and believe in long-term value will survive.