Original Author: Prathik Desai, Token Dispatch
Original compilation: Oliver, Mars Finance
We like to believe that we are rational when choosing a business platform. We compare costs, read reviews, weigh features, and then select the one that best meets our needs. But look at the reality when you need to exchange currency at the airport: you walk to the nearest currency exchange counter because it's right there, and the sign looks official. Convenience makes the decision for us.
This applies to nearly all the markets we have established. The success of the trading hall does not stem from better prices or superior technology; it succeeds because it is the place where everyone agrees to meet. The reason Nasdaq has successfully attracted IPOs from technology and emerging consumer companies is not because its technology is superior to that of the NYSE, but because it has positioned itself as the place where growth companies and their investors agree to meet.
Ebay defeated dozens of early auction sites not because its software was better, but because it was the place where buyers and sellers agreed to meet.
Every market starts off quiet. Participants do not come because there is nothing to trade; and there is nothing to trade because participants have not arrived. In exchanges, this manifests as empty order books, volatile prices, and poor execution. The first platform to solve this “chicken or egg” problem often wins it all. Meanwhile, the second place usually fades away or remains a distant follower forever.
We have also seen similar scenarios in the cryptocurrency market. Decentralized exchanges (DEX) once promised a world where anyone could create markets, fees were transparent, and control would not be concentrated in one person's hands. This promise was once fulfilled until it no longer worked.
In September this year, Hyperliquid, a leading DEX in the perpetual contract trading space, began to lose market share. Its decline is not slow, unlike how giants are usually gradually eroded. A new platform called Aster, supported by Binance founder Zhao Changpeng (CZ), exploded almost overnight. Then, three days ago, the data tracking website DeFiLlama completely removed Aster's data. It stated that the trading volumes appeared to be fabricated.
The falsification of data is not even the most concerning aspect. Ironically, even in the crypto world where every transaction, every wallet, and every fee is traceable, such things still happen. It is unsettling to realize that distinguishing between an organically growing popular exchange and one that successfully guides real users through simulated heat is almost impossible. Their infrastructures are the same, and the order books look identical. The only difference lies in whether the crowd is spontaneously arriving or artificially engineered.
This story is about this tension: how DEX artificially designs viral dissemination, the difference between momentum and the real market, and what simple tests can reveal who is worth making your next trade with.
Let's rewind time a bit. September 2025 is the month when the monthly trading volume of perpetual contract DEXs first surpassed $1 trillion. Not annually, but in a single month. From July to September, the total trading volume of perpetual contract DEXs has approached the total for the entire year of 2024 in this field. Until May 2024, the processing volume of these platforms was typically less than 10% of centralized exchanges like Binance. By September 2025, they reached 20%. Today, in perpetual contract trading, one dollar out of every five is happening on transparent, auditable infrastructure.
Although the early perpetual contract DEX leader Hyperliquid sparked this trend, it is newcomers like Aster and Lighter that are driving its growth.
Three forces converge here:
Regulatory pressure has made traders uneasy about the custody of funds on centralized platforms.
The technology has become increasingly mature, achieving sub-second execution, carefully designed mobile applications, and an interface that feels just like Binance.
Token economics has evolved into a real income machine. Using transaction fees for token buybacks, suddenly you have a sustainable business model: more transactions make the tokens more valuable, thereby attracting more traders, which generates more fees.
Not all platforms can keep up with exponential growth. Cracks begin to appear, revealing who is building for sustainability and who is just going with the flow. When everyone's trading volume is increasing, every platform seems successful. It is only when incentives dry up that the differences become apparent.
Take the story of Hyperliquid as an example. Launched in 2023, it is a Layer 1 blockchain tailored for trading volume. For most of 2025, it dominated the market with an absolute advantage, with monthly processing volumes between $175 billion and $400 billion. The platform distributed 27.5% of its HYPE tokens to 94,000 users and refused to accept VC investment. This move gave users ownership instead of diluting them with insider sell-offs. This kept users around.
Next, Aster launched in September and immediately exploded onto the market with a trading volume of $420 billion for the month. Its token valuation skyrocketed from $170 million at launch to a peak of $4 billion. Hyperliquid's market share plummeted from 45% to 8% within a few weeks.
Its common tactic involves large-scale airdrop programs. In just the second phase, 320 million tokens were distributed, peaking at a value of 600 million dollars. It incentivized traders to trade more, hold tokens, refer friends, and accumulate points. This trick worked well, and trading volume skyrocketed as a result. There was a moment when Aster seemed unstoppable.
And the next moment, it vanished without a trace. You can no longer find this data on DeFiLlama, as the tracking site removed Aster on the grounds of data falsification.
Currently, Hyperliquid's market share in the perpetual contract DEX has risen to 28%, still less than half of what it was less than two months ago. Lighter follows closely in second place with a 25% share.
@DeFiLlama
This event helps us reflect on what distinguishes the platforms that can survive from those that are fleeting. I categorize them into four types.
The first is liquidity. It's like gravity.
Without a deep liquidity pool, traders will face slippage, which is the gap between the expected price and the actual execution price. Hyperliquid has established its own Layer 1, achieving 20,000 orders per second and 0.2 milliseconds of finality. Lighter uses ZK-rollups to achieve matching speeds of below 5 milliseconds. However, technology alone cannot solve the cold start problem: you need market makers, and without traders, they won't come; traders, on the other hand, won't come due to a lack of liquidity.
Hyperliquid solves this issue through its HLP pool, which is a protocol-owned liquidity pool with an annual percentage yield (APY) of 6-7%, providing foundational depth before organic market makers arrive. On October 11, Friday, when U.S. President Donald Trump announced a 100% additional tariff on China, triggering a new round of trade tensions, the crypto market experienced $19 billion in liquidations within 24 hours. During this time, Hyperliquid's HLP vault profited $40 million in just one day from the liquidations, pushing the return rate to nearly 190% annual percentage rate (APR).
@HLPVaults
Most platforms have never solved this liquidity problem. They launch with excellent technology and empty order books. But no one comes because there is nothing to trade.
Secondly, it is incentives. They can create a flywheel effect, at least temporarily.
The difference between sustainable incentives and one-time expensive “gifts” determines sustainability. Hyperliquid's model addresses this by broadly distributing ownership and then using 93% of trading fees for token buybacks. This way, the value of the tokens is directly tied to the usage of the protocol, rather than future mining expectations. Aster simply “sprinkles coins” to users and hopes they will stick around. This is very effective in generating trading volume, but we can already see its long-term results in real time.
The third is user experience (UX). UX determines user retention.
If your DEX experience is worse than Binance, users will eventually leave. Hyperliquid's interface might even be mistaken for a centralized exchange by new traders. EdgeX has launched a multi-party computation (MPC) wallet, allowing users to trade without managing mnemonic phrases. Lighter charges zero fees for retail investors. It is these small details that determine whether traders stay or go. Think about those features: guaranteed stop-loss, sub-accounts for risk isolation, and user-friendly mobile applications.
The fourth is the power of culture. Memes and opinion leaders create tribes.
The narrative of Hyperliquid is: high-performance DeFi first, community-owned, no VC investment, built from scratch. Recently, the airdrop rewarded early supporters with the Hypurr Cats NFT series, proving that culture can build a loyal community. Even in the case of Aster, the meme “CZ's Revenge”—implying that Binance is building infrastructure that regulatory bodies cannot touch—has paved the way for its sudden surge in adoption. Lighter positions itself as the “savior of perpetual contracts on Ethereum,” backed by a16z and former Citadel engineers.
Cultural dynamics are important because a sense of belonging is equally important for a community made up of loyal crypto traders. In the crypto world, users are not just choosing trading platforms; they begin to identify with these platforms, defend them, put token symbols in their Twitter bios, and participate in Reddit forums and Discord channels. This tribalism creates organic marketing and user stickiness.
Successful platforms have achieved all four points. Aster tried to take shortcuts and overly relied on memes and incentives. When people questioned the authenticity of its liquidity, everything began to shake.
A chart released by the founder of DeFiLlama shows that the trading volume of Aster's XRP and ETH is almost identical to that of Binance's perpetual contracts.
@DeFiLlama
In contrast, Hyperliquid's trading volume fluctuates independently. A reliable indicator is the Volume-to-Open Interest ratio. Open interest measures the amount of capital at risk in open positions. If the trading volume is $10 billion but only $250 million is locked in positions, there is a problem. Hyperliquid's ratio hovers just above 1, indicating real position building; whereas Aster's ratio has reached 20, suggesting a significant disparity between trading volume and open interest.
@DeFiLlama
As a member of the cryptocurrency space, I often ponder the difference between real growth and artificial growth. Every prosperous market in history has, to some extent, been artificially designed. The original intention of Nasdaq was to compete with the NYSE by allowing small companies to go public. eBay was established to address specific trust issues. Once a critical scale is reached, growth appears organic, but it all stems from careful design.
Cryptography simply makes this “design engineering” visible in real time. You can observe how the platform injects seed liquidity, incentivizes users, iterates features, and then either achieves product-market fit or collapses in the attempt.
Aster is still around. Its second phase airdrop of 320 million unlocked tokens has increased selling pressure. Aster's trading volume/position ratio of up to 20 has already indicated that most of the trading volume is not from real position building.
The greater insight we can gain from the case of Aster is that when the market operates on a transparent track, anything is possible.
For many years, we have pretended that the market is a neutral infrastructure, unrelated to the funds flowing through it and those controlling access. But the market has never been separable from the systems that run it, and those systems are always connected to the people who control them. We simply cannot see the internal structure of this machine clearly enough to even ask whether this matters.
Now we can see it. We can verify whether the liquidity is real, or if bots are trading with themselves. We can observe whether the platform is building a sustainable business or executing a carefully designed extraction plan.
Platforms that facilitate smooth trading, have deep liquidity that makes slippage a non-issue, and boast an intuitive interface that makes you forget you're using crypto products are more likely to succeed. In the long run, they may become invisible infrastructure akin to VISA and MasterCard.
We certainly haven't reached that point yet. But we can already see how a successful DEX is structured. This enables us to ask the right questions to discern which platforms are building towards the “invisible” goal and which are just putting on a show. We will take the time in the coming years to differentiate them.
That's all for this week's in-depth analysis.
See you next time… stay curious.
