For years, Ethereum has been the hub of decentralized finance, pioneering on-chain financial tools like lending protocols and tokenized assets. However, the rapidly growing sector of perpetual futures, or 'perps', has primarily thrived on other platforms. Traders are more likely to find on-chain perpetuals on Hyperliquid or Solana, as these platforms are optimized for the extremely fast, low-cost, and high-frequency trading that perps demand. According to AJ Warner, chief strategy officer at Offchain Labs, '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 and attract institutional attention.
Ethereum's security-first architecture has made it an ideal settlement layer, but its block times and gas costs have historically made it an expensive platform for running latency-sensitive trading applications.