The derivatives track leads the next bull market. MYX Finance is about to issue a token. Can it take over Hyperliquid's "wealth-making legend"?

In 2024, Bitcoin broke through all the way, setting new highs in the fourth quarter, successfully breaking through the $100,000 mark, and detonating the crypto market. People exclaimed, "The familiar taste is back!"

Although the spectacular market of "thousands of coins rising together" has not yet arrived, with the reshaping of global geopolitical relations, the improvement of US regulatory expectations, and the acceleration of traditional finance to include BTC and other head tokens in its balance sheet, it can be confirmed that the "wealth code" will soon be on the stage - the author found through combing through the recent TGE project tokens that with the explosion of the popular derivatives protocol Hyperliquid, the derivatives track may lead this round of "wealth narrative".

"Derivatives Wealth Narrative" Leads the Way, Hyperliquid and MYX Finance "Scramble for Land" on the Chain

From the perspectives of macro regulation, market space, and protocol fundamentals, we can find that the decentralized derivatives trading track is undoubtedly one of the most promising tracks after a simple analysis.

First, with the Trump administration taking office in January next year, crypto regulation will usher in clear regulatory rules and a relaxed market environment. Mainstream institutions will accelerate their entry into the crypto trading market, which will increase the overall trading volume of spot and derivatives trading. Based on overseas users' preference for security and privacy, especially after the FTX crash in the United States, the decentralized derivatives protocol on the chain is undoubtedly more attractive than CEX in the market due to its transparency and security.

Secondly, judging from the stock capital data of the crypto market, crypto users have assets of approximately US$31.59 billion in CEX, accounting for only 12.6% of total assets, while the monthly spot trading volume of these users on CEX is as high as US$3.87 trillion, accounting for 93.4% of total trading volume. In contrast, crypto users have US$281.74 billion on-chain, accounting for 87.4% of total crypto assets, but the monthly spot trading volume on the chain is only US$273 billion, accounting for 6.6% of total trading volume. The "mismatch" of assets and trading volume shows us that CEX is still the main trading platform for crypto users, while DEX is more of a "test field" - if DEX can make breakthroughs in throughput, user experience, scalability, etc., and optimize user trading experience, on-chain assets will inevitably save the redundant steps of withdrawing coins to CEX transactions and trade directly on DEX, and decentralized DEX will be able to realize the potential trading market of huge assets on the chain and usher in a huge wave of growth.

From the perspective of DEX product experience, in the past few years, DEX and derivatives protocols have made great progress in product form, functional experience, etc. in response to the traditional pain points of CEX. For example, Hyperliquid and Synfutures, which have been listed, and MYX Finance, which has not yet been listed, have fixed their respective product positioning, provided high-level user experience, and attracted users in the on-chain world, which is quite similar to the domestic Internet era.

For example, Hyperliquid, which is in the limelight, tried to create a "CEX on the chain" by building a high-performance Hyperliquid L1. It once became the hottest Perp DEX in the English region, and it has the momentum to compete with dydx. After TGE, the total market value of HYPE tokens once reached 4.91 billion US dollars, exceeding the total market value of OKB, the token of the top CEX platform. MYX Finance, a popular project that is rumored to be launching a token soon, has opened up liquidity in cross-chain scenarios, linking isolated ecosystems and multiple chains, and has magnified asset liquidity by dozens of times by creating a "chain abstract liquidity layer" and its original MPM mechanism. It has swept the on-chain trading users and become the fastest growing multi-chain Perp DEX in 2024. The author mentioned these two projects to illustrate through the following analysis that HYPE and MYX may continue to ignite the derivatives track and bring a strong wealth effect.

Hyperliquid "wealth effect" with an average airdrop of $84,300

Driven by the above background, derivatives protocols such as Hyperliquid and Synfutures have successively held TGEs, creating extremely eye-catching market performances, among which Hyperliquid's market performance is particularly outstanding.

On November 29, the decentralized derivatives protocol Hyperliquid announced the creation of its native token HYPE. After HYPE went online, it soared from the opening price of $2 to $14.86 on December 7, a 643% increase in just one week. Since then, the price of the coin has continued to rise, reaching a high of $28.91 on December 17, an increase of 134.55%. According to statistics, a total of 310 million tokens were distributed in the Hyperliquid Genesis event. Even if calculated at the opening price of $2, the airdrop scale reached $620 million; if calculated based on the price on December 17, the total airdrop scale was as high as $9.325 billion. The actual number of Hyperliquid airdrops was about 274 million tokens, and a total of 94,000 addresses received airdrops - that is, the average HYPE airdrop received 2,915 HYPEs per person, worth about $84,300, or more than 600,000 yuan!

Based on strong product power, user base and reasonable token economics, HYPE has created a wave of "phenomenal" growth, but unfortunately, before and after Hyperliquid released the airdrop, the Chinese community did not give it due attention, and many KOLs and retail investors who focused on making money also missed this wave of "wealth codes" - HYPE's "like stepping into the air" made us have to carefully scan the derivatives protocol track so as not to miss the next wealth code.

"Chain Abstract Liquidity Layer" MYX Finance: The most anticipated derivatives wealth code in 2025

Hyperliquid's wealth effect has indeed brought a wave of "massive traffic" to the derivatives track. Many DEXs and even protocols in other tracks that have never been heard of want to take advantage of this wave of hot spots and bring some exposure to their projects, but this also brings a lot of interference information to investors. The author hopes to comprehensively sort out the derivatives trading protocols with comprehensive strength, including Hyperliquid, dYdX, Synfutures, MYX Finance, GMX, etc., from the dimensions of product positioning, growth potential, trading performance, and token economics, and compare various indicators to determine whether a project is worth looking forward to. On the whole, MYX Finance may be the derivatives protocol with the best chance to take over HYPE and become the wealth code in 2025.

Many CEX users may not be familiar with MYX Finance. The founding team of the MYX project comes from the TOP3 CEX, traditional financial institutions and VCs. The project received investment from Sequoia, Consensys, and Hack VC in last year's seed round of financing. In February of this year, the project was officially launched on the mainnet. It is currently deployed on three chains, Arbitrum, Linea and opBNB, and supports derivative transactions of more than ten assets including BTC and ETH. This also leads to a point that the author wants to emphasize very much. Let’s not look at the "empty" gimmicks such as financing and endorsement. Everything serves the user's trading experience.

The author has been trading in MYX Finance for more than half a year. From May to now, as a user, the perception on the product side is still relatively strong. It can be seen that MYX Finance is a very down-to-earth team that is willing to listen to the voice of users. Especially in the second half of 2024, MYX Finance has promoted product-side cooperation with Particle, zkPass, OKX Wallet, Halo Wallet and other protocols while optimizing protocols and products and launching Telegram trading applet. It has realized the automatic creation of wallets for social media/mobile phone logins and seamless cross-chain transactions, bringing users on the chain a trading experience equivalent to CEX.

(1) Product Advantages: Trading Scenarios

In terms of product positioning, MYX Finance aims to create a "chain abstraction liquidity layer" protocol to solve the two major problems of DEX "liquidity" and "ease of use". While providing a CEX-level trading experience, it retains the composability and scenario innovation potential of DEX.

In order to solve the liquidity problem, the current leading dYdX and the well-known Hyperliquid both adopt the traditional order book model (CLOB). Although this model provides similar trading depth and user experience to CEX, it requires a large number of market makers to provide liquidity, and the funds of market makers are fragmented and locked at different prices, resulting in extremely low capital utilization efficiency and high data storage and computing costs - this is obviously not in line with the ideal product form of DEX; GMX V2, GNS and other protocols use a hybrid mechanism of P2Pool, integrating the advantages of order books, AMMs, virtual AMMs and other mechanisms, with a good user trading experience, but due to the complexity of the system, it requires high development and operation capabilities, and due to the diversity of LP composition and different interests, governance is also difficult.

To address the liquidity issues in on-chain transactions, MYX Finance’s answer is the MPM (Matching Pool Mechanism) market-making mechanism. On the basis of introducing a liquidity pool, MYX Finance uses funding rates and Maker rebates to balance the interests of both long and short parties. Under the incentive of funding fees, the ratio of the number of open contracts between long and short parties is often close to 50:50, in order to solve the long-term position imbalance problem. By introducing high-frequency market makers through Maker rebates, MYX also solves the imbalance problem caused by medium and high-frequency users.

The innovation of MYX Finance’s market-making mechanism demonstrates higher capital efficiency than traditional P2Pool. In an environment where long and short positions grow alternately, MPM can use limited funds to support a position size that is dozens of times larger than its own, greatly improving the capital efficiency and returns of LPs. When the market is unbalanced, LPs on MYX Finance can clearly manage their own exposure, flexibly choose to hedge passive positions in other markets, or bear the profits and losses caused by position fluctuations, gaining greater strategic space and risk management flexibility.

The MPM mechanism is not only extremely friendly to LPs, but also brings traders a trading experience that surpasses CEX - strong liquidity not only brings a 0-slippage, seamless trading experience, but also reduces users' transaction costs to an extremely low level - whether compared with the top 3 CEXs or DEXs such as dYdX and Hyperliquid, MYX Finance's transaction fees are much lower. Combined with the recent VIP equity activities, high-frequency traders can save tens of thousands of dollars in fees every month.

(2) Product advantages: cross-chain scenarios

In cross-chain trading scenarios, MYX Finance uses chain abstraction architecture to solve the liquidation problems and composability limitations of CEX. With the help of account abstraction wallets, it greatly improves the utilization efficiency of single-chain assets, unpopular assets, and liquidity-depleted assets, releases the potential of various types of assets, and further optimizes the trading experience brought by the MPM mechanism.

Specifically, suppose we open a contract order for an unpopular asset/restaking token/low-liquidity asset on CEX, and this transaction is unfortunately liquidated. Due to the restrictions of specific on-chain rules/lack of liquidity/imperfect cross-chain technology, the liquidated assets may not be able to cover the debt owed. MYX Finance uses the chain abstraction architecture to open up asset liquidity between multiple chains. Whether you hold isolated single-chain assets or unpopular assets, you can make full use of them and place mortgage orders in MYX Finance - this greatly amplifies the utilization efficiency and liquidity of assets, and improves the user's LP and asset utilization efficiency by dozens of times.

Based on the MPM market-making mechanism and chain abstraction architecture, MYX Finance provides a smooth cross-chain trading experience with zero slippage, ultra-low fees, and multiple assets. This user experience, coupled with a series of airdrops and reward activities, has enabled MYX Finance to achieve an astonishing growth rate in user base and trading volume since the mainnet was launched in February - it took only 36 days for MYX's daily trading volume to reach 100 million US dollars. To achieve this number, dYdX took 184 days and GMX took 86 days. Since then, MYX Finance's average daily trading volume has remained as high as 100 million US dollars.

(3) Product advantages: social + trading

In order to further strengthen the horsepower of the "growth engine", MYX Finance launched the Telegram mini app last month. Currently, Telegram has a huge user base of 800 million, and 90% of crypto users use Telegram for socializing. By integrating "social + trading", MYX Finance's TG mini app has greatly reduced the "transaction path" of Telegram users. After entering the MYX mini app, users can log in through social media accounts such as Twitter and Facebook, or through mobile phones and emails, and a wallet will be automatically created for the user, greatly reducing the learning cost and usage cost of Web2 users on Telegram. According to the product plan to be announced later, MYX Finance will welcome a group of trading KOLs to settle in and launch the "copy order function", truly opening up "social + trading" on the chain. After users have finished chatting about the market, bragging, listening to analysis, or sharing trading strategies with KOLs, they can copy orders with one click and follow the operations of the big bulls.

(4) Token Economics: Benefiting the Community and Users, Maximizing Expectations of Appreciation

It can be seen that compared with Hyperliquid, Synfures and derivatives protocols that have just been listed, MYX Finance is very competitive in terms of products. However, historical experience tells us that no matter how competitive the product is and how many users it has, if the token empowerment is not done well and users cannot be motivated to buy and hold tokens, the market performance of the token is usually not satisfactory.

The Tokenonomics announced by MYX Finance locks the secondary market after TGE by restricting the allocation and release of tokens for projects and institutional investors to protect the interests of retail investors and community airdrop recipients - the total amount of tokens for the project is fixed at 1,000,000,000 MYX, the team only retains 20% and the tokens are unlocked one year after the launch and distributed monthly within two years; 20% of the tokens are owned by institutional investors, locked at TGE, and distributed monthly in the 18 months after 6 months of TGE - by restricting the unlocking time for institutions and teams, MYX Finance has locked the selling pressure from private equity and teams after the tokens are listed to the greatest extent, and has made every effort to maintain the trading environment of the MYX token secondary market.

In addition to 10% of the tokens as initial liquidity and 5% of the tokens as reserve funds, MYX Finance will airdrop 45% of the total project tokens, or 450,000,000 MYX, to community users through various operational activities to encourage users to trade on MYX, provide liquidity and participate in various activities on the platform. Compared with projects such as Hyperliquid, MYX Finance has the lowest airdrop acquisition cost, and because the project itself is very "easy to use", beginners can complete a series of interactions without even any tutorials.

For example, MYX Finance's largest airdrop event, the "Origin Plan", airdrops 20% of the total MYX tokens to early participants. Users usually only need to complete social media tasks and trade normally (enjoying extremely low transaction fees during the period) to win the airdrop. Currently, nearly 10,000 users have participated in the "Cambrian", "Ordovician" and "Silurian" phases of the "Origin Plan". Although I am not sure, judging from the scale of the prizes, the ongoing "Devonian" event is the largest phase since the start of the "Origin Plan", and it is also very likely to be the last large-scale airdrop event before the project's TGE. If the wool party has not participated yet, you can complete the task first and leave an airdrop base.

(5) Market value management and investor background

From the perspective of the team and investors’ background, the MYX Finance team members themselves come from large firms, top VCs and established financial institutions, and are undoubtedly experts in currency value management. In the seed round of financing, it naturally received investment from Sequoia Capital, Consensys, Hack VC, OKX Ventures, and GSR, and later became one of the first projects to receive investment from the Linea Ecosystem Investment Alliance. With the support of top VCs and ecosystem, it can be seen that the resources behind MYX Finance are very substantial, and capital and ecosystems are also very optimistic about its subsequent growth space and performance in the secondary market.

Among the derivatives protocols that have been listed this year, Hyperliquid’s market performance is the most outstanding. Synfutures’ market performance is not as good as expected, and it has not been able to take over the wave of “derivatives fever” ignited by Hyperliquid. According to internal information, MYX Finance is very likely to conduct TGE in Q1 next year. Considering the above-mentioned product strength, user base, capital strength, and future vision, MYX Finance is indeed the most promising one to take over among the derivatives protocols to be listed next year. It is understandable that we missed out on Hyperliquid, as we were indeed hit by a surprise attack; but as the derivatives market continues to heat up, it would be wrong to miss out on MYX again.

After the DeFi Summer of 2020 came to an end, the on-chain world fell into a "misfire"-like silence. Many developers and crypto players suddenly lost their way and entered the "crypto winter" - in 2024, driven by the nourishment of BTC, the crypto market returned to "spring" - with derivatives protocols such as Hyperliquid, Synfutures, and MYX Finance shining one after another, in the cold winter, developers are not "hibernating", but cultivating the on-chain ecology, broadening application scenarios, strengthening the degree of implementation, and improving the interactive experience - with this series of actions, the user base of the on-chain ecology is growing rapidly!

For investors, especially those who have experienced this long bear market, what they should do is to uphold the mentality of "all sails have passed", actively embrace the new round of bull market, and realize that "the world on the chain is the true form of encrypted products" - MYX Finance, Hyperliquid and other projects represent not only a new round of "wealth codes", but also represent the infinite possibilities and application value brought by the innovations behind them, such as "chain abstract liquidity layer", "unconscious transactions", and "MPM".

This article is from a contribution and does not represent the views of BlockBeats