For several years, Ethereum has been at the forefront of decentralized finance, pioneering on-chain financial tools such as lending protocols and tokenized assets. However, the rapidly expanding sector of perpetual futures, also known as 'perps', has primarily thrived on other platforms. When asking traders about the current hub for on-chain perpetuals, they are more likely to mention Hyperliquid or Solana rather than Ethereum.
This is because perpetuals require extremely fast, low-cost, and high-frequency trading, which Ethereum's base layer was not designed to optimize. AJ Warner, chief strategy officer at Offchain Labs, the main developer firm behind the layer-2 Arbitrum, stated, 'Perps require frequent transactions, fast execution, and deep liquidity, making them a natural use case for the Arbitrum platform.' The distinction has become increasingly important as decentralized perpetual exchanges mature into markets that attract institutional attention.