Yenwen Feng, CEO, Perpetual Protocol in an interview was asked pointing to how Uniswap and Sushiswap are doing more volumes than Coinbase for example on certain days, but do you think this will also happen in the decentralized derivative DEX sector?

Yenwen Feng:  Yes, I certainly believe.  That’s why I am working on this.  Maybe like 1 or 2 years ago, it’s very hard (for a DEX to beat a CEX).  But with all the L2 solutions coming up, I mean, (in the past) we had this usability issue, we had this (blockchain’s) performance issue. We had (crypto projects’) mechanism (design) issues.

I think performance (for a blockchain) at least, it will be fixed in the near future. And mechanism-wise, actually, like I said, not only us, like our competitors, they’re working on different things.

They (also) try to bring the features on par with the centralized exchanges. So, I think that will be solved in the near future as well.  But for UX, it’s still hard to make sure your money is safe.  Like, you have to guard your money on your own. That is still hard, that’s not a quick fix.  But I do believe that in the near future, there will be someone coming up with a better private key management solution.

But these 3 issues (usability, performance, and mechanism issues), I think we can definitely solve them. And, (trading on a DEX) will be more efficient than trading on a CEX.

Also, recently Yenwen Feng clarified on: “xDai actually working quite well.  The gas fee is really low and I think the throughput is good. We have been on there and we don’t really have any major issue. But for PERP v2, the whole system depends on Uniswap v3. So, we need to go to the place that Uniswap v3 will deploy. So, Uniswap commits to deploy on Arbitrum and also Optimism. Those are the places we are going to be on.”

For clarity, Arbitrum is a Layer 2 cryptocurrency platform that makes smart contracts scalable, fast, and private.  Arbitrum has four main advantages: scalability, privacy, the AnyTrust Guarantee of correct execution, and interoperation with Ethereum. No other solution combines these benefits.

Optimism is a Layer 2 scaling solution for Ethereum that can support all of Ethereum’s Dapps. Instead of running all computation and data on the Ethereum network, Optimism puts all transaction data on-chain and runs computation off-chain, increasing Ethereum’s transactions per second and decreasing transaction fees.