TechFlow Insights
Perennial is a DeFi derivatives protocol for trading price exposure. It is a pool-based automated market maker (AMM) that provides leveraged exposure to traders and generates fees for liquidity providers.
As a derivatives AMM, Perennial offers services by directly hedging any trader's position at oracle prices with floating funding rates. Traders deposit collateral to gain leveraged exposure to various price sources, while liquidity providers supply capital to the protocol and earn fees by taking the opposite side of trades. LPs and traders continuously settle against each other, with the losing side paying the winning side.
One of Perennial's key features is zero price impact, enabling trades to be executed directly at oracle prices regardless of trade size. Additionally, trades are settled in USD cash rather than cryptocurrency, aligning with the most popular crypto derivatives. Perennial is an efficient protocol designed to minimize fees for both traders and liquidity providers. It is also built for developers' needs, offering low-cost, fully on-chain, and easily integrable composability infrastructure. Liquidity providers can customize their experience with high leverage (up to 50x) and full control over risk exposure and hedging strategies. Furthermore, Perennial is a permissionless protocol for market creation, integration, and composition.
