The Shifting Power Dynamics in Perpetual DEXs: Lighter, Hyperliquid, and the Future of On-Chain Derivatives

The perpetual decentralized exchange (Perp DEX) landscape in 2025 is a battlefield of innovation, incentives, and structural differentiation. Two platforms-Hyperliquid and Lighter-have emerged as titans in this arena, yet their trajectories reveal a stark divergence in market dynamics. While Hyperliquid, once commanding over 71% of the perp DEX market share in May 2025, now faces a 38% decline by October 2025, Lighter has surged with a $11.74 billion TVL and $1.7 billion Open Interest (OI) by December 2025 according to reports. This article dissects the structural underpinnings of their competition, analyzing how liquidity models, order book design, and fee strategies are reshaping the future of on-chain derivatives.

TVL and OI Trends: A Tale of Two Platforms

Hyperliquid's dominance in 2025 was underpinned by its custom Layer 1 blockchain and HyperBFT consensus mechanism, enabling sub-second order finality and 200,000 transactions per second. However, its TVL plummeted from $6.35 billion in September 2025 to $4 billion by late November 2025, while its OI dropped to $407 million in November 2025 from $74.2 billion earlier in the year. This erosion reflects broader challenges: token unlock pressures, centralized governance concerns, and aggressive competition from platforms like Aster and Lighter according to analysis.

Lighter, by contrast, has leveraged a zero-fee model and Ethereum L2 security via a custom zk-rollup to attract traders and liquidity providers. Its TVL grew to $11.74 billion by December 2025, with OI reaching $1.7 billion. Lighter's invite-only model and institutional backing-such as its Lighter Liquidity Pool (LLP)-enabled it to sustain zero trading fees while maintaining robust returns for liquidity providers. By late October 2025, Lighter's daily volume hit $8 billion, outpacing Hyperliquid's 7.67% trading volume share according to data.

Market Structure: Liquidity, Order Books, and Fee Strategies

The structural divergence between Hyperliquid and Lighter is critical to understanding their trajectories. Hyperliquid's order book design mirrors centralized exchanges (CEXs), offering candlestick charts and a familiar interface for institutional traders according to industry reports. Its protocol-managed liquidity pools (HLP) further deepen its liquidity, but this centralized-like structure has drawn scrutiny in a market increasingly prioritizing decentralization according to analysis.

Lighter, meanwhile, has redefined liquidity provision by incentivizing external makers with zero fees. Its use of zero-knowledge proofs ensures cryptographic guarantees for every trade, anchoring its state to Ethereum and eliminating reliance on trusted bridges according to technical documentation. This architecture not only enhances security but also appeals to users prioritizing transparency. Lighter's order book depth even surpassed CEXs in certain cases by mid-2025 according to market data, a testament to its ability to attract liquidity through structural innovation.

Fee strategies further amplify this divide. Hyperliquid's fees remain undisclosed, but its market share decline suggests traders are prioritizing cost efficiency. Lighter's zero-fee model, by contrast, has become a defacto standard in the Perp DEX wars, forcing competitors like EdgeX to adopt lower fee structures to remain relevant.

The Future of On-Chain Derivatives: Sustainability and Scalability
The 2025 Perp DEX wars highlight a broader tension between scalability and decentralization. Hyperliquid's technical prowess-200,000 TPS and institutional recognition like a regulated HYPE ETP on SIX Swiss Exchange-positions it as a credible alternative to CEXs. However, its centralized governance and token unlock pressures raise questions about long-term sustainability.

Lighter's model, while innovative, faces its own challenges. Zero-fee trading relies on robust liquidity pools and institutional backing to avoid insolvency. If market conditions shift or liquidity providers withdraw, Lighter's OI and TVL could face downward pressure. Yet its zk-rollup architecture and Ethereum anchoring provide a strong foundation for trustless scalability.

Conclusion: A New Era for Perp DEXs

The competition between Hyperliquid and Lighter underscores a pivotal shift in the on-chain derivatives market. Hyperliquid's decline in market share reflects the limitations of centralized-like structures in a decentralized-first ecosystem, while Lighter's rise demonstrates the power of zero-fee models and cryptographic guarantees. As the sector matures, platforms that balance scalability, security, and user incentives will dominate. For investors, the key lies in monitoring structural innovations-like Hyperliquid's HLPs or Lighter's zk-rollups-and their ability to adapt to a rapidly evolving landscape.