Margined swaps / perpetuals

Proposal: Introduce margined swaps or perpetuals

Summary: Perpetuals volumes are much higher than spot on all exchanges. Let users leverage up longs and naked shorts.

Motivation: Liquidity is autoregressive. And more volumes → more fees

Specification: To start with implement an API-only margined trade product. Then tie up with liquidity providers with zero maker fee incentives. Integrate with Hummingbot.

6 Likes

yes it is absolutely necessary

This is more of a complex proposal than it seems on the surface.

Adding native perps or margin trading to a platform massively increases the legal and regulatory risk for the platform and therefore by extension may not be in the best interests of DVF token holders. In order to facilitate, DeversiFi would need to KYC users, ban USA users and other jurisdictions, obtain licences and add additional regulatory reporting - this would go against DeversiFi’s principles of openness. However, further decentralising the platform and protocol could be an option to accomplish this

We have looked at adding margin tokens as an interim step but there has been a bit of a backlash against them over the past 18 months as they are much more complex then they seem and a lot of the time the people who are trading them do not understand the product. There would need to be a huge UX overhaul and additional educational materials before margin tokens could be traded on DeversiFi - this is definitely doable but does add some more context to the discussion

1 Like

How about enabling just leverage trading using a protocol like Maker, Compound or Dydx L1?

@RossMidd you only need to support “Borrow against balance” to allow leveraged longs right?