TLDR
- Percolator, a new DEX by Yakovenko, aims to improve perpetual futures trading on Solana.
- Percolator will feature two on-chain programs: Router and Slab for efficient trading.
- Hyperliquid DEX’s growth has impacted Solana, attracting high-value users to its platform.
- Yakovenko’s Percolator DEX proposal targets sharded decentralized trading for scalability.
Anatoly Yakovenko, co-founder and CEO of Solana Labs, has announced plans to introduce a decentralized exchange (DEX) called Percolator. This move follows the success of other decentralized exchange platforms, such as Hyperliquid and Astar, and aims to create a new sharded perpetual exchange protocol on the Solana blockchain.
The announcement highlights the growing interest in decentralized trading protocols and their potential to shape the future of cryptocurrency markets.
What is Percolator?
Percolator is designed as a perpetual exchange, allowing users to speculate on cryptocurrency prices without an expiration date for the contracts. The exchange will operate on two primary on-chain programs. First is the Router program, which manages collateral, portfolio margins, and cross-slab routing. The second is the Slab program, a perpetuals engine run by liquidity providers. The Slab will feature fully self-contained matching and settlement functionalities. These features are intended to enhance the decentralized trading experience by providing more efficient and streamlined operations.
Yakovenko’s proposal for Percolator, which was uploaded to GitHub on Monday, aims to improve the decentralized exchange landscape. By focusing on perpetual futures contracts, Percolator looks to offer traders more flexibility in their trading strategies, particularly in the highly volatile cryptocurrency markets.
Hyperliquid DEX and its Impact on Solana
The announcement of Percolator comes just a week after Hyperliquid, another DEX, introduced significant upgrades to its platform. The Hyperliquid Improvement Proposal 3 (HIP-3) upgrade allows third parties to launch their own perpetual swap contracts, adding permissionless, builder-deployed perpetual futures contracts. This feature requires users to stake at least 500,000 Hyperliquid (HYPE) tokens, valued at around $18.2 million. The upgrade aims to provide independent margins and parameters, offering more control to individual users and developers.
Notably, Hyperliquid’s growth has been at the expense of Solana. A recent report by VanEck highlighted that in July, Hyperliquid accounted for 35% of all blockchain revenue, with significant user migration from Solana, as well as from Ethereum and BNB Chain. VanEck analysts, including Matthew Sigel, Patrick Bush, and Nathan Frankovitz, noted that Hyperliquid’s success in attracting and retaining high-value users from Solana demonstrates the platform’s appeal. These users have been drawn to Hyperliquid due to its simple yet highly functional trading interface.
The Future of Solana and Perpetual Exchanges
Yakovenko’s Percolator protocol aims to directly compete with platforms like Hyperliquid, which has made inroads into the Solana blockchain. The introduction of such advanced decentralized trading protocols is expected to push the boundaries of what is possible in the DeFi space.
While Hyperliquid has been successful in attracting users, Yakovenko’s new offering could bring a fresh set of innovations to the Solana ecosystem, positioning it as a key player in the decentralized finance sector.
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