Decentralized perpetual futures trading accelerated sharply in 2025, with cumulative on-chain Perp DEX volumes reaching about $12.09 trillion, up from roughly $4.1 trillion in 2024. The expansion was heavily back-half weighted, as monthly volumes repeatedly cleared the $1 trillion mark and product improvements pulled in more sophisticated flow.
The surge also coincided with a perceived regulatory unlock for institutional participation. Market participants interpreted the CFTC’s late-2025 approval of intermediated on-chain prediction markets as a precedent that could broaden regulated access to on-chain derivatives infrastructure.
Regulation and Institutional Read-Through
Regulatory developments in late 2025 reshaped the operating calculus for professional participants. The CFTC’s decision on intermediated on-chain markets was widely viewed as lowering friction for institutional routing into decentralized venues, turning on-chain transparency into an execution and risk-analytics advantage. Market makers and cross-venue arbitrage desks increasingly leveraged observable order flow, funding dynamics, and liquidation mechanics to inform positioning and hedging. In effect, DeFi’s structural improvements became more usable infrastructure for professional workflows, not just retail speculation.
For compliance teams, the operational implications were immediate and tangible. Custody and execution setups that might have been tolerated as informal in earlier cycles required clearer segregation, auditability, and record-keeping as volumes scaled. On-chain funding rates, transparent trade histories, and visible liquidation pathways simplified some surveillance activities, but new pressures emerged around jurisdictional exposure. Multi-venue, multi-chain deployments increased reconciliation complexity between on-chain settlement and off-chain onboarding and KYC processes.
Market Structure Shift: From Single Leader to Multi-Venue
Within 2025, the decentralized perps ecosystem moved from concentrated leadership toward a more competitive, multi-venue structure. An early leader delivered CEX-like throughput through advanced order-matching technology, reporting more than $3 trillion in annual volume and roughly $844 million in revenue before losing share later in the year. Competitors scaled rapidly: one multi-chain entrant briefly captured nearly half the market in September before settling at a smaller share, while multiple ZK-rollup and CLOB implementations expanded throughput and product breadth. The net result was a market where liquidity and activity could rotate faster across venues. That rotation increases both opportunity for best execution and operational burden for oversight teams.
Product innovation narrowed feature gaps with centralized exchanges and improved execution quality for different trade intents. Perp DEXs introduced broader order-type suites including market and limit variants (FOK/GTC/IOC), post-only, trailing stops, and TWAP, alongside permissionless listings, RFQ fills for larger sizes, and fee models tuned for short-horizon flow. Total value locked in Perp DEX protocols rose to about $20 billion over the year, reflecting meaningful capital committed to on-chain derivatives liquidity provision. These upgrades repositioned DEX perps from “alternative venue” toward a more complete derivatives stack.
Progress, however, came with visible operational friction and episodic stress. Market participants cited the “$JELLY incident” as an example of concentrated protocol exposure translating into reputational and liquidity pressure. Token-based governance, staking models, and permissionless market creation required guardrails such as slashing, open-interest caps, and validator standards to contain contagion. In fast-moving venues, risk controls become part of product design rather than an external overlay.
Operational expectations also sharpened across roles. VASPs and custodians prioritized stronger on-chain trade record-keeping, tighter reconciliation between on-chain settlement and client ledgers, and deeper audits of automated liquidation engines. Risk teams needed to incorporate funding-rate volatility, oracle composition, and maker/taker fee mechanics into margin models and stress testing. Compliance functions faced intensified jurisdictional review and beneficial-ownership checks as multi-chain complexity increased counterparty opacity without intermediary controls.
Looking into 2026, observers will track how institutional-grade workflows are implemented in practice. Segregation of duties, custody architecture, and reconciliation rigor will be central markers of maturity as on-chain derivatives integrate more deeply with regulated operating models. With sustained volumes, richer product sets, and regulatory precedents in view, Perp DEXs appear set to remain core to discussions on operational standards, supervisory expectations, and cross-venue risk management.