Perpetual Protocol works by allowing users to trade a variety of digital assets using "perpetual contracts". These contracts are similar to traditional futures contracts, but unlike futures, they do not have an expiration date. This means that traders can hold their positions for as long as they want, and can trade both long and short positions.
When a trader wants to open a position, they must provide collateral in the form of the underlying asset or another supported collateral. The price of the asset is determined by an automated market maker (AMM) algorithm, which takes into account the current supply and demand for the asset.
The trading on Perpetual Protocol is done on-chain, meaning that all trades are recorded on the Ethereum blockchain and can be publicly audited. This ensures transparency and trustless trading. Additionally, Perpetual Protocol has a built-in governance system, which allows users to vote on important protocol decisions, such as the addition of new assets or changes to the trading fees.
When a trader wants to close a position, they must settle the difference between the entry and exit price of the contract. Traders can also add or remove collateral to maintain the required collateralization ratio.
Perpetual Protocol was developed by the team at Aave, which is a decentralized lending and borrowing platform. The project was first announced in 2020 and the mainnet launch took place in September of that year.
The initial version of Perpetual Protocol, v1, was focused on providing high leverage trading for Ethereum-based assets. It quickly gained popularity among traders due to its trustless and decentralized nature, as well as its ability to offer high leverage trading.
In late 2020, Perpetual Protocol announced the launch of v2, which added support for trading a wider range of assets, including Bitcoin, and other ERC-20 tokens. The new version also introduced the concept of "global liquidity pools", which allows traders to access liquidity from other decentralized exchanges.
In early 2021, Perpetual Protocol announced the launch of v3, which introduced a new governance mechanism and a new token, the PIPT, which is used to vote on protocol decisions and earn a share of the trading fees.
Throughout its history, Perpetual Protocol has been focused on providing a more flexible and efficient trading experience for users compared to traditional centralized exchanges, and continuously improving the protocol's features and functionalities.
$PERP is the native token of the Perpetual Protocol. It serves several purposes within the protocol, such as:
Governance: $PERP holders can vote on important protocol decisions, such as the addition of new assets or changes to the trading fees.
Trading Fees: $PERP is used to pay trading fees on the protocol, and holders of the token can earn a share of the trading fees.
Collateral: $PERP can be used as collateral to open positions on the protocol.
Staking: $PERP holders can stake their tokens to earn a share of the trading fees and to participate in the protocol's governance.
Liquidity provision: $PERP can be used to provide liquidity to the global liquidity pools in the protocol, by providing liquidity to the trading pairs it will earn a share of the trading fees
The total supply of $PERP is capped at 100 million tokens and as of now, it is listed on a variety of decentralized exchanges (DEXs) and centralized exchanges, and can be traded for other digital assets such as ETH, BTC, and USDT. As usual, the token price is determined by the supply and demand on the market.
The founders of Perpetual Protocol are Stani Kulechov, Jordan Lazaro Gustave, and Mher Davtyan.
Stani Kulechov is the CEO and founder of Aave, which is a decentralized lending and borrowing platform, and one of the key players in the development of Perpetual Protocol. He has over 7 years of experience in the Fin Tech and blockchain industry and has been involved in several blockchain projects prior to Perpetual Protocol.
Jordan Lazaro Gustave is the CTO and co-founder of Aave, and has also been a key contributor to the development of Perpetual Protocol. He is a software engineer with over 8 years of experience in the industry, and has a strong background in blockchain and smart contract development.
Mher Davtyan is the COO and co-founder of Aave, and also played a key role in the development of Perpetual Protocol. He has over 8 years of experience in the Fin Tech industry and has worked as a management consultant and private equity analyst prior to joining Aave.
The team behind Perpetual Protocol is highly experienced in the blockchain and Fin Tech industry, and they have a strong track record of delivering successful projects.
