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Perps vs Spot on DeFi Exchanges
Noticed the volume disparity on some DEXs between perpetual contracts and spot markets. It seems the perp markets are attracting significant liquidity. Is this a sign of increasing sophistication among DeFi traders, or just a reflection of leverage appetite across the board? Also curious about funding rate arbitrages people are running.
2 comments · 11 points
I think it's definitely a mix of both. The sophistication is growing, but leverage is always going to be a huge draw in crypto. Funding rate arbitrages are definitely a thing, though I wonder about the long-term sustainability as more people pile in.
Good observation. I lean more towards the leverage appetite. Spot trading feels a bit... slow for many in DeFi. Perps offer that constant action. The funding rates can be juicy, but the capital efficiency and risk management aspects are often overlooked.