Perpetuals Done Better

InfinityPools is a decentralized exchange that can offer trading for any asset with unlimited leverage, no counterparty risk, and no risk of liquidation. Similar to Uniswap’s breakthrough, InfinityPools stands out because it offers an unparalleled improvement over anything currently available in both the TradFi and DeFi realms.

DeFi Evolution and a Cycle of Pseudo-Innovation

Over the past years, the DeFi (Decentralized Finance) landscape has undergone significant transformation, particularly with the advent of Layer 2 scaling solutions. These innovations have addressed some of the scalability and cost issues associated with Ethereum, which had hitherto been a significant barrier to the development of complex financial derivatives in the DeFi space.

Initially, Layer 2s and other scaling solutions appeared to hold the promise of fostering a new era of innovation in DeFi, enabling the creation of structured products, options Automated Market Makers (AMMs), and perpetual futures that could not have thrived on Ethereum due to high transaction costs. There was a general sentiment that these developments could offer improved solutions over existing DeFi protocols, and even potentially rival centralized exchanges in terms of product offerings and efficiency.

However, as the market matured, it became evident that many of the new products and protocols that emerged in this period did not bring any substantial innovation to the table. Most of these were mere replications of existing financial derivatives, such as perpetual futures or options, without any meaningful improvements. Moreover, they often provided a worse user experience compared to centralized exchanges, characterized by lower leverage, wider spreads, and higher costs. This essentially meant that they could not compete effectively against established players, even after the downfall of some centralized exchange giants like FTX.

This phenomenon, where a wave of new products and protocols emerge but do not offer any real value or improvement over existing solutions, can be described as a cycle of pseudo-innovation. In such a cycle, despite the hype and high expectations, the market eventually realizes that the new offerings are essentially rehashed versions of existing products and cannot compete effectively with incumbents. This serves as a cautionary tale for investors and underscores the importance of critically evaluating new protocols and upcoming primitives.