Key facts
- GMTrade is a decentralized perpetuals protocol built on Solana.
- The platform aims to offer trading of both crypto and real-world assets.
- GMTrade uses a pooled liquidity model, charging 0.5 basis points in fees.
- It integrates Chainlink Low-Latency Oracles for real-world asset trading.
- LP yields are generated from trading fees, borrowing fees, and liquidation fees.
GMTrade, a decentralized perpetuals protocol built on Solana, is evolving beyond its initial GMX fork origins to become an independent platform aiming to offer a comprehensive on-chain trading experience akin to Robinhood. Co-founder William highlighted the strategic choice of Solana due to its low transaction fees and high performance, which are crucial for a competitive trading environment. The platform utilizes a pooled liquidity model, which GMTrade claims allows for faster market expansion and significantly lower trading costs, charging 0.5 basis points compared to the typical 3 basis points on other Solana platforms. This model avoids the need for deep order books and subsidizing market makers, contributing to cost efficiency.
GMTrade's integration with Chainlink Low-Latency Oracles is a key enabler for expanding into real-world asset markets such as FX, commodities, and eventually stocks, which are significantly larger than the crypto market. The protocol's liquidity provider (LP) yields are derived from trading fees, borrowing fees, and liquidation fees. William emphasized that unlike some DeFi protocols that rely heavily on token incentives, GMTrade focuses on organic yield, where LPs act as counterparties to traders and share in their PnL risk, with losing traders typically outnumbering profitable ones over time. The platform also offers optional incentive programs that do not require fund lock-ups, providing an additional layer of rewards. The project's points system, GT Points, is designed to reward genuine protocol contribution, including trading fees, borrowing fees, LP activity, and referrals, with the intention of fostering long-term demand rather than short-term incentive farming.