Perpetual Protocol

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Discover Perpetual Protocol's fundamentals and latest news.

This content was generated by Whalee (BETA), an AI crypto assitant that analyses cryptocurrencies. Informations can be incomplete and/or erroneous. Please always double check and DYOR.

What is Perpetual Protocol?

Perpetual Protocol (PERP) is a decentralized finance (DeFi) platform built on the Ethereum blockchain, offering a trustless crypto trading platform for perpetual swaps and futures contracts. It allows users to trade with high leverage and minimal liquidity issues, utilizing an automated market maker (AMM) system. The native PERP token serves as a governance token and is used for transaction fees and liquidity provision.

How is Perpetual Protocol used?

The Perpetual Protocol (PERP) token is a native cryptocurrency used within the Perpetual Protocol ecosystem. It has several key uses:

  1. Earning Rewards: Token holders can lock their PERP tokens in a smart contract to earn rewards in the form of USDC. The amount of rewards received is based on the number of tokens locked and the duration of the lock period. This process generates "voting escrow PERP" (vePERP) tokens, which are used for community governance and reward distribution.

  2. Community Governance: vePERP tokens enable holders to participate in the decentralized autonomous organization (DAO) of Perpetual Protocol, allowing them to vote on proposals and shape the future of the platform.

  3. Staking: Users can stake their PERP tokens to secure passive rewards. The amount of rewards earned through staking is based on the number of tokens locked up.

  1. Liquidity Provision: PERP tokens are used to provide liquidity to the platform, which helps to ensure that traders have access to the assets they need. Liquidity providers earn rewards for their contributions.

  2. Platform Interaction: PERP tokens are required to interact with the platform's features, such as trading and staking. This ensures that users have a vested interest in the platform's success and are incentivized to contribute to its growth.

Overall, the PERP token plays a central role in the Perpetual Protocol ecosystem, facilitating community governance, reward distribution, and platform interaction.

How do I store Perpetual Protocol?

To store Perpetual Protocol (PERP) tokens, you can use the Coin98 Wallet. Here are the steps to follow:

  1. Open Coin98 Wallet: Start by opening the Coin98 Wallet on your device.
  2. Search for PERP Token: Click on the search icon on the home screen and search for PERP Token.
  3. Add PERP Token: Once you find the PERP Token, add it to your wallet by following the on-screen instructions.

This will allow you to securely store your PERP tokens within the Coin98 Wallet.

How to buy Perpetual Protocol?

To buy Perpetual Protocol (PERP) tokens, you can follow these steps:

Using Kraken
  1. Create an account: Sign up on Kraken's crypto exchange and connect a funding method.
  2. Verify your account: Complete the security check and enable JavaScript and cookies.
  3. Buy PERP: Use your connected funding method to purchase PERP tokens.
Using KuCoin
  1. Create an account: Sign up on KuCoin with your email address, mobile phone number, and country of residence.
  2. Secure your account: Set up Google 2FA, anti-phishing code, and trading password.
  3. Verify your account: Enter personal information and upload a valid Photo ID.
  4. Add a payment method: Add a credit/debit card or bank account.
  5. Buy PERP: Use a variety of payment options to buy PERP tokens on KuCoin's spot market.
Using Kriptomat
  1. Create and verify your account: Sign up with Google, Apple, or enter your name and email, and verify your email, phone number, and identity.
  2. Add funds: Make a bank deposit or use your credit card to add funds.
  3. Buy PERP: Click on the Kriptomat icon, select "Buy," choose Perpetual Protocol, enter the amount, preview the transaction, and confirm your purchase.
Using Coinbase
  1. Create a Coinbase account: Download the Coinbase app and sign up with a valid ID.
  2. Add a payment method: Connect a payment method such as a bank account, debit card, or initiate a wire transfer.
  3. Start a trade: Select "Buy & Sell" on Coinbase.com or tap the (+) Buy on the Home tab in the mobile app.
  4. Select Perpetual Protocol: Search for Perpetual Protocol and select it from the list of assets.
  5. Enter the amount: Input the amount you want to spend in your local currency.
  6. Finalize your purchase: Preview the transaction and confirm your purchase.
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History of Perpetual Protocol

Perpetual Protocol (PERP) was founded in 2019 by a small team of startup founders and software engineers, initially known as "Strike." The project was later renamed to Perpetual Protocol in the summer of 2020. The founders, Yenwen Feng and Shao-Kang, are Taiwanese bitcoin entrepreneurs who previously built payroll and accounting solutions for crypto enterprises.

The project started in 2018 under the name "Strike," but it was not until December 2020 that it launched under its current name. During this period, Perpetual Protocol secured a $1.8 million seed round led by Multicoin Capital in August 2020. The seed round was supported by several well-known investors, including Alameda Research, Binance Labs, CMS Holdings, and Zee Prime Capital.

The initial version, Perp v1, was launched on the xDai network in December 2020. However, due to issues with the insurance fund, the team worked on solutions and eventually launched Perp v2, dubbed Curie, on Optimism in November 2021.

Throughout its development, Perpetual Protocol has been supported by a number of investors and has undergone significant changes to improve its functionality and stability. Today, it operates as a decentralized derivatives trading platform, allowing users to trade perpetual futures contracts with high leverage and minimal liquidity issues.

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How Perpetual Protocol works

Perpetual Protocol (PERP) is a decentralized derivatives exchange that allows users to trade perpetual contracts, which are similar to futures contracts but without an expiration date. Here is a detailed overview of how it works:

Virtual Automated Market Maker (vAMM)

Perpetual Protocol uses a vAMM as a price discovery mechanism instead of a direct liquidity pool for spot trading like Uniswap, Balancer, or Curve. The vAMM is designed to provide guaranteed on-chain liquidity with predictable pricing set by constant product curves. It is market neutral and fully collateralized, ensuring that traders can trade with up to 20x leverage long or short, with transparent fees and 24/7 guaranteed liquidity.

Staking and Governance

The PERP token is the native token of Perpetual Protocol and plays a crucial role in the system. PERP holders can stake their tokens to secure passive rewards, including PERP-denominated staking rewards and 50% of the network trading fees in USDT. Staked PERP tokens can also be used for governance, allowing holders to vote on or propose new ideas to improve the protocol.

Trading and Leverage

Perpetual Protocol allows users to trade perpetual contracts with leverage, enabling them to open long or short positions. The platform ensures price stability through regular settlements of long or short positions and maintains consistency between perpetual future contracts prices and market prices. This is achieved through a funding mechanism that ensures liquidity and prevents discrepancies in prices.

Security and Audits

Perpetual Protocol has undergone multiple third-party audits by respected firms like Consensys and Peckshield to ensure the platform is secure and free of coding errors. Additionally, the platform has open-source code, allowing anyone to review its processes. It also has insurance coverage provided by Unslashed Finance and Nexus Mutual.

Developer Tools and Community

Perpetual Protocol provides a range of developer tools and encourages community involvement. The platform has a decentralized autonomous organization (DAO) where users can participate in governance and decision-making processes.

Token Distribution and Economics

The PERP token was launched using a Liquidity Bootstrapping Pool (LBP) on the Balancer DEX. The total supply of PERP tokens is 150 million, with allocations for the ecosystem, development team, advisors, investors, and liquidity providers. The token is used for platform rewards and community governance.

In summary, Perpetual Protocol is a decentralized derivatives exchange that uses a vAMM to provide liquidity and leverage trading options. It relies on the PERP token for staking, governance, and platform rewards, ensuring a secure and community-driven platform.

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Perpetual Protocol's strengths

Perpetual Protocol (PERP) offers several strengths that contribute to its value and potential for growth:

  1. Multipurpose Token: PERP is a multipurpose cryptocurrency that serves as a utility token, enabling users to interact with the platform's features such as staking and providing liquidity.

  2. Decentralized Governance: The token allows holders to participate in community governance, ensuring that only those financially invested in the market have a say in its development. This democratic approach fosters a sense of ownership and encourages active participation.

  3. Staking and Rewards: Users can stake their PERP tokens to secure passive rewards, which are based on the number of tokens locked up. This feature is highly sought after in the DeFi sector due to its low overhead and consistent returns.

  1. Liquidity Program: The platform integrates liquidity pools, enabling users to earn rewards by providing liquidity. This program helps projects secure funding and ensures lenders receive repayment on time, even if borrowers repay late.

  2. Developer Tools: Perpetual Protocol provides an extensive selection of developer tools, encouraging contributions to the ecosystem and fostering growth through collaboration.

  3. Security: The platform is open source, has undergone multiple third-party audits, and has insurance coverage, ensuring a secure environment for users.

  1. Low Fees: By integrating L2 scaling solutions, Perpetual Protocol offers fast transactions with minimal fees, making it an attractive option for investors.

  2. Flexibility and Leverage: The platform allows for leveraged trading with up to 20x leverage on long and short positions, offering users a high degree of flexibility and potential for profit.

These strengths collectively position Perpetual Protocol as a robust and versatile DeFi platform, offering users a range of benefits and opportunities for growth.

Perpetual Protocol's risks

Perpetual Protocol (PERP) is a decentralized finance (DeFi) project that operates as a perpetual futures decentralized exchange. It allows users to trade perpetual futures contracts, which are agreements to buy or sell an asset at a predetermined price without an expiration date. The platform uses a virtual automated market maker (vAMM) to provide liquidity and manage risk. Here are some key financial risks associated with Perpetual Protocol:

  1. Smart Contract Risk: As a DeFi platform, Perpetual Protocol relies on smart contracts to operate. Any vulnerabilities or errors in these contracts can lead to significant financial losses for users.

  2. Leverage Trading Risks: Perpetual Protocol offers leverage trading options, which can amplify both profits and losses. Users must be cautious when using leverage, as it can result in significant financial losses if not managed properly.

  3. Market Volatility: The platform is exposed to market volatility, which can lead to significant price fluctuations. This can result in losses for users, especially if they are not adequately prepared for market changes.

  1. Liquidity Risks: Although the vAMM helps maintain liquidity, there is still a risk of liquidity shortages, especially during times of high market stress. This can lead to significant losses for users if they are unable to close their positions quickly.

  2. Insurance Fund Risks: Perpetual Protocol has an insurance fund to cover potential losses. However, if the fund is depleted, the protocol may mint new PERP tokens to cover the losses, which can lead to inflation and dilute the value of existing tokens.

  3. Governance Risks: The PERP token is used for governance, and holders have a say in important decisions. However, if governance decisions are not made in the best interests of the platform, it can lead to financial risks for users.

  1. Security Risks: As an open-source platform, Perpetual Protocol is exposed to security risks. If the platform is hacked or compromised, users' funds can be lost or stolen.

These financial risks highlight the importance of thorough research and caution when investing in or using Perpetual Protocol.

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Did Perpetual Protocol raise funds?

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Perpetual Protocol’s team

  • Yenwen Feng: Founder of Perpetual Protocol, previously involved with Decore, Gamelet, and Willmobile Inc.
  • Shao-Kang: Co-founder of Perpetual Protocol, involved in the project since its inception under the name "Strike" in 2018.
  • Hana Chang: Co-founder at BountyHunter and Head of Community at Perpetual Protocol.
  • Nicholas Tong: Head of Strategy at Perpetual Protocol.

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