Attracting Traders to Sui Network’s Perp DEX: Innovation and Incentives
To attract traders to Sui Network’s Perp DEX, it may take more than just technical innovation; highly attractive incentive mechanisms could be the key. This article originates from 0xShinChan, a crypto KOL, and is organized, compiled, and authored by Felix, PANews.
(Background: The Sui ecosystem is heating up! BOBA DAO collaborates with the Sui Foundation to host the “Taipei Water Party” community meetup.)
(Context: Delphi Digital: In-depth Analysis of Sui Q1 Ecosystem Development)
The post-FTX era has fundamentally changed the trading landscape, driving a significant influx of users to decentralized perpetual contract exchanges (Perp DEX). The daily trading volume on these platforms now often exceeds $30 billion, highlighting the immense demand for decentralized derivatives.
However, the fragmented nature of early Perp DEX platforms has often been hindered by the usability of UI/UX, liquidity depth, and the reliability of price feeds, obstructing their widespread adoption. Beginning in 2024, the market landscape has started to change, marked by the emergence of innovative models like GMX PVP and dYdX order books. Currently, the lending, DEX, and yield trading protocol teams on the Sui Network are enriching their product lines, including perpetual contract trading.
Advantages of Sui in Perp DEX
Sui actually offers several compelling features that make it a strong contender for building perpetual DEX.
- High Performance and Low Latency: Sui’s parallel transaction processing allows for high throughput and low latency, which are crucial for efficient order matching and a smooth trading experience on DEX.
- Object-Centric Data Model: Sui’s unique data model supports efficient storage and parallel processing of account and asset data.
- Seamless Onboarding with zkLogin: The zkLogin feature streamlines the onboarding process, allowing users to create accounts using familiar Web2 credentials, thereby reducing barriers to entry for new traders.
- Sponsored Transactions: Sui’s sponsored transaction feature can lower user costs and enhance the overall trading experience.
Below are the early builders on Sui:
- Bluefin
- Astros, supported by NAVI Protocol
- Aftermath Finance
- Typus Finance GLP Trading Model
- Kriya is also set to launch its Perp DEX soon.
Before delving into each, here is an overall comparison chart.
Comparative Analysis of Various Protocols
Bluefin
Bluefin, as a veteran Perp DEX on Sui, combines a fast-matching off-chain order book with a secure on-chain settlement engine. The protocol’s liquidity is managed by professional market makers (MM):
Leveraging Sui’s parallel transaction processing capabilities, Bluefin boasts extremely low order execution latency and rapid on-chain final confirmation (under 500 milliseconds). Additionally, it supports nearly all perpetual contract assets on Sui, covering a broad range including $DEEP, $WAL, and $TRUMP.
Bluefin’s 24-hour perpetual contract trading volume ranges between $40 million to $70 million, indicating high platform activity. The BTC-PERP trading pair typically accounts for the largest share of daily trading volume (around 60%), followed by SUI-PERP and ETH-PERP. According to Defi Llama data, the annual fees generated are approximately $4 million.
With excellent UI/UX, users can utilize the trading view feature, and the interface is clear, containing all necessary information. Notably, Bluefin’s zkLogin integration is supported by Sui, simplifying the user onboarding process and eliminating the complexities of wallets and seed phrases.
Aftermath (Testnet)
Aftermath launched its Perp DEX testnet in November 2024. Unlike many Perp DEXs that rely on off-chain order book matching, Aftermath places the entire order book on-chain. As it is still in the testnet phase, statistics are limited.
Aftermath places greater emphasis on enhancing the liquidity/TVL of its DEX and existing liquidity pools. Future potential incentive measures and the official release of its Perp DEX may occur later.
Astros (Beta)
Astros is a DEX aggregator + Perp DEX created by the NAVI Protocol team. Like Bluefin and Aftermath, NAVI Protocol also employs an order book mechanism in its Perp DEX. As it is currently in the testing phase, information regarding cooperative market makers (MM) and specific mechanisms is not yet comprehensive. Its 24-hour trading volume has reached $300 million, likely driven by its ongoing trader incentive program.
Typus Perp
Typus Finance launched its GMX-style Perp DEX approximately two weeks ago. According to Defi Llama data, the 24-hour trading volume is around $200,000, with the TLP pool’s TVL exceeding $700,000.
The assets in the TLP pool include $SUI, $USDC, $DEEP, and $LBTC, with the current APR exceeding 100%.
Observations and Conclusions
The Rise of Order Books: The current ecosystem of Perp DEXs on Sui is clearly skewed towards the order book model, a phenomenon reflected in both protocol design choices and its dominance in trading volume. This suggests that the order book mechanism either has inherent applicability within Sui’s architecture or has gained market recognition among its user base.
Asset Scarcity and the Lure of Memes: The range of assets supported by Sui Network’s Perp DEX is noticeably limited, representing potential opportunities. If a protocol can quickly embrace the volatile yet lucrative realm of memecoin trading (which has a continuously developing cultural foundation on Sui), leveraging the inherent speculation of these assets could drive platform trading volume upward.
Early Stage and the Necessity of Incentive Mechanisms: Compared to the mature and highly liquid Perp DEX ecosystems on EVM and Solana, Sui’s cumulative trading volume and TVL are still in their infancy. Given the existing feature sets and available functionalities of these alternative chains, attracting traders to Sui Network’s Perp DEX may require more than just technical innovation; highly attractive incentive mechanisms may be the key drivers to attract speculative capital and facilitate significant growth of the Perp DEX ecosystem.
