KEYTAKEAWAYS
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Lighter is betting on a radical zero-fee model, embedding fairness into zk-SNARK proofs to guarantee verifiable order matching and liquidation.
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While Hyperliquid dominates with raw performance, edgeX with depth and engineering, and Aster with ecosystem loops, Lighter differentiates by combining zero fees with provable fairness.
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The sustainability of Lighter’s model hinges on building depth, retaining real users post-airdrop, and finding revenue beyond points-driven activity.
- KEY TAKEAWAYS
- THE BIRTH OF A TECH REVOLUTION: PUTTING MATCHING INTO ZERO-KNOWLEDGE PROOFS
- DATA SURGE AND POINTS MIRAGE: THE TRUTH BEHIND THE NUMBERS
- CLASHING WITH GIANTS: SPEED, DEPTH, ECOSYSTEM AND FAIRNESS
- THE LAST MILE OF COMMERCIALIZATION: WHEN ZERO FEES MEET SUSTAINABILITY
- DISCLAIMER
- WRITER’S INTRO
CONTENT
THE BIRTH OF A TECH REVOLUTION: PUTTING MATCHING INTO ZERO-KNOWLEDGE PROOFS
In the perpetual DEX arena, most projects compete on fees, UI, or asset coverage. Lighter chose the hardest yet boldest path—writing order matching and liquidation into zero-knowledge proofs. Every order, every match, every forced liquidation is validated by zk-SNARK circuits and finalized on Ethereum mainnet contracts. The team calls it “verifiable matching and verifiable liquidation,” directly addressing the most fundamental trust issue in DeFi.
This architecture narrows the power of the sequencer to the minimum: it only collects and orders transactions but cannot alter the priority. Price–time rules are hard-coded into the circuit, leaving no room for manipulation. For traders long haunted by MEV, this is close to a silver bullet. Users no longer fear having their orders skipped or front-run—every result can be verified.
Lighter also ports CeFi’s risk controls onto chain. Initial margin, maintenance margin, and close-out margin create a layered system; liquidations follow stages from warnings to partial closeouts, with the LLP (Lighter Liquidity Pool) acting as the insurance fund. When accounts go underwater, LLP takes the position; if the pool cannot cover, ADL (Auto-Deleveraging) kicks in. All steps are provable. This is not just a narrative of “safety,” but a mechanism anchored in mathematics.
The cost of such design is complexity. In early 2024, Lighter engaged zkSecurity to audit its circuits, which flagged flaws in MiMC hash implementation. The team fixed the issues, showing its intent to anchor “verifiable” not only in story but also in code.
DATA SURGE AND POINTS MIRAGE: THE TRUTH BEHIND THE NUMBERS
If technology is Lighter’s backbone, zero fees are the spark. In closed beta, maker and taker fees were set at zero; funding payments flowed directly between longs and shorts, with the protocol taking nothing. For high-frequency traders, this was paradise—suddenly, even tiny arbitrage spreads became profitable.
The impact was immediate. Daily trading volume stabilized between $1–2 billion, cumulative turnover surged into tens of billions, and LLP TVL expanded from a few million to several hundred million dollars. Discord crossed ten thousand members, Twitter followers soared, and leaderboards were filled with accounts endlessly opening and closing positions.
But numbers are noisy. Research showed Lighter’s volume-to-open-interest ratio peaking at 27, while a healthy market sits below 5. This signaled wash trading and points farming rather than pure organic demand. In reality, the mix was both: genuine strategy traders alongside armies of airdrop hunters.
And that’s not entirely bad. The points system was designed to amplify activity before a token exists. Hyperliquid proved that “airdrop expectation” alone can fuel adoption. The real test for Lighter will come when points turn into tokens: can it turn farmed volume into retained liquidity? If trading collapses after the airdrop, zero fees lose their magic.
CLASHING WITH GIANTS: SPEED, DEPTH, ECOSYSTEM AND FAIRNESS
By 2025, the perpetuals race is no longer about who can build, but who can endure.
Hyperliquid embodies the “performance paradigm.” It built a proprietary L1, wrote matching into consensus, and achieved CEX-level speed and depth. Its proposition is blunt: when execution is extreme, users will stay.
edgeX represents “engineering and depth.” Backed by Amber, it built a zk/L2 order book with unusually strong liquidity. With ultra-low fees and stable market-making support, it steadily wins high-frequency traders. edgeX may not have Hyperliquid’s spotlight, but it builds staying power block by block.
Aster plays the “ecosystem game.” Riding BNB Chain’s flow, it offers a simple mode for newcomers and a pro mode for quant teams, while tying in its own stablecoin and staking assets to form a capital loop. It doesn’t obsess over latency but wins by locking both retail and institutions inside an ecosystem.
Against these, Lighter looks radical. It doesn’t claim to be faster or deeper—it just made trading free and fairness provable. In a market where Hyperliquid sells speed, edgeX sells depth, and Aster sells ecosystem stickiness, Lighter throws down a different line: “trade here without paying a cent, and without trusting anyone.”
Together they sketch four diverging paths: Hyperliquid pushing performance to the edge, edgeX capturing pros with liquidity and engineering, Aster scaling via ecosystem loops, and Lighter betting it all on zero fees and verifiability. The next storm will reveal which moat—speed, depth, ecosystem, or fairness—actually holds.
THE LAST MILE OF COMMERCIALIZATION: WHEN ZERO FEES MEET SUSTAINABILITY
Every story ends with a business model. Zero fees bring flow, but not cash flow. Today, Lighter relies on LLP gains from losing traders and liquidation fees. Both are uncertain: when traders win or markets calm, revenues vanish. Without steady income, LPs may retreat and TVL could dry up.
The team knows this tension. Ideas floated include charging high-frequency API users while keeping retail free, tying LLP returns to token economics, or launching premium services. The logic is clear: keep zero fees for growth, but find another path for sustainability.
One bold experiment is letting LLP shares double as trading margin. Users can earn LP yield and trade with the same capital. Paired with cross-asset collateral and public vaults, this pushes capital efficiency to a new frontier. If it works under stress, Lighter could build lasting stickiness.
But zero fees alone are not destiny. The moat will be tested on three fronts: depth, retention, and cash flow. In a blood-red race, Lighter’s tale is compelling—a Citadel-trained team, a zkRollup on Ethereum, and a gamble to make trading free and verifiable. Whether it holds when the storm hits will decide if this gamble rewrites the game, or fades into yet another chapter in DeFi’s endless experiments.
