Decentralization for the sake of decentralization is the biggest pseudo-demand.

Written by: Joe Zhou, Foresight News

Interviewee: Leonard, Aster CEO

The winds of the crypto market are quietly changing.

"In the past, you couldn't have imagined that the trading volume of gold and oil on a Perp DEX (decentralized perpetual contract platform) could surpass that of Solana or XRP. But now, these two RWA (Real-World Assets) have strongly entered the top five of our platform's trading volume and become the norm."

Leonard, CEO of Aster, used a set of simple but impactful data to tear apart the industry's long-standing grand narrative.

In his view, the market winds have shifted because users' real needs have changed. Without the filter of wealth-creation myths, people now only pay for real trading experiences.

Leonard said: Today's leading Perp DEXs have completely matched centralized exchanges (CEXs) in terms of matching speed, order book depth, and fee costs—even surpassing them in trading experience by stripping away the complexity of traditional delivery contracts.

"Decentralization for the sake of decentralization is the biggest pseudo-demand in this industry," Leonard stated bluntly. "Users will never pay simply for the word 'decentralization'. Only when your underlying experience catches up to or even exceeds that of CEXs will your decentralization and self-custody of funds become truly dominant advantages."

On the occasion of Aster's first anniversary, we sat down with Leonard for a more "unpackaged" conversation. No talk of visions—only reality: market trends, bear market survival, effective innovation, and how a leading DEX can survive this cycle in a brutal market that's "moving from virtual to real."

Market Winds Are Shifting

Joe Zhou: What assets have performed best on your platform recently?

Leonard: Definitely gold and oil lately. From a growth perspective, their momentum is the strongest. Currently, gold and oil have entered the top 5 of our platform's trading volume. In the past, you couldn't have imagined that an RWA (Real-World Asset) trading pair on a Perp DEX could surpass Solana or XRP. But now, this is the norm on our platform.

Joe Zhou: The market is constantly changing, and traders' attention is shifting—how do you observe and capture these hotspots?

Leonard: Each market cycle has different hotspots. For example, with frequent geopolitical events recently, gold and oil have generated sufficient volatility, which traders love the most. Frankly, three months ago, no one expected gold and oil to be so popular on-chain.

As a long-term trading platform, our focus isn't on betting on the next hotspot. Instead, we prioritize building solid underlying liquidity and matching infrastructure. What we aim to do is: no matter what type of asset the cycle rotates to, the platform can quickly respond to demand so that everyone can trade at any time. Although the proportion of traditional financial asset trading has risen now, it's not impossible that half a year later, the bull market returns and the volatility of small crypto assets comes back. The key for the platform is to have the ability to adapt to these changes at any time.

Joe Zhou: In the past three months, has trading on Aster been more driven by retail or institutional users?

Leonard: The proportion of institutional users on Aster has indeed increased recently.

One reason is the market environment. In a bear market, the active funds available to retail users decrease, while institutional funds relying on stable arbitrage strategies are less affected. The other, more important reason is that Aster has always focused on "private trading," which is a real need for some institutions.

For large investors and quantitative institutions, their strategies are absolutely confidential—once exposed on transparent chains, they become ineffective. With the launch of our privacy features, many institutional users migrated their funds here specifically to address this pain point.

Joe Zhou: Have there been any structural changes in retail trading behavior?

Leonard: Retail users' demand for "interest-bearing assets" has increased significantly in the volatile market.

People find it harder to make money from pure trading now, so they need a guaranteed return. For example, USDF on our platform and USD1, which recently added yield attributes, perfectly align with retail users' current psychology: they can earn a guaranteed return on stablecoins while using them as margin to open positions whenever an opportunity arises. This is a direction where retail growth is relatively fast.

Joe Zhou: What do you think the next cycle will look like? What's the biggest difference from this one?

Leonard: This is a question no one can answer absolutely—if we knew, everyone would have acted already (laughs).

But one very clear trend is: projects in this cycle are getting closer to commercial reality. Previously, many projects were driven by "narratives"—the bigger the pie you drew, the bigger the vision, the higher the valuation. But now, this no longer works.

The current market values real users and real revenue: How much fee income do you have? How much real money can you use for token repurchases? Therefore, I believe the underlying logic of the next cycle will become more and more like traditional finance, with higher requirements for a project's "fundamentals" and "cash flow."

Survive, Then Keep Iterating with High-Frequency Trials

Joe Zhou: Many people say we're in a bear market now. If so, this should be Aster's first bear market. How do you think a project should survive a bear market?

Leonard: I think it's not just the bear market—regardless of the market condition, cash flow is the most important reliance for survival.

If you're a long-term builder, you must have a good product and a reasonable business model for users to be willing to pay. Then, you need to price your product reasonably, generate revenue, and finally return the earned income to holders through a healthy Tokenomics.

As long as you focus on these three links, the bear market is actually an excellent construction period. Without the hustle and bustle of the bull market, you can iterate your product more attentively and recruit talents who are willing to work calmly. As long as you hold positive cash flow to get through the winter, you will naturally reach a new height in the next bull market.

Joe Zhou: What's your current main revenue structure?

Leonard: It's essentially trading fees. Over 80% of our revenue comes from fees. That's why we've repeatedly emphasized the importance of user quality—because our revenue comes from real trading; only when people trade and pay fees do we have cash flow.

Joe Zhou: Over the past year, with so many competitors in Perp DEX, what's the core underlying logic that allowed Aster to "deliver on time," "survive," and "become a leader"?

Leonard: There are two core points: respect for risk control and a mechanism for rapid trial and error.

First, risk control. Our team has a deep background in centralized exchanges, so we naturally attach great importance to risk control. In the crypto industry, finding the right track is important, but surviving is more important. Because every cycle has new trends—only if you live to that moment do you have the chance to take off again.

Second, rapid trial and error. In this cycle, many Perp DEXs choose to polish their products to be more perfect and have better data before doing TGE. But looking back, the market is unpredictable. Instead of pursuing the "perfect timing," it's better to deliver the product faster and let the market give feedback. The market is the best teacher. Instead of repeatedly deducing internally, it's better to launch as soon as possible, let users vote with their feet, and let the price give the answer. We have always insisted on: deliver first, then optimize—not wait for a so-called "perfect moment." Of course, we will look for a relatively suitable window, but we won't be obsessed with perfection.

Another point is that the outside world often only sees the few hotspots we hit, but not the many unsuccessful attempts behind them. Our approach is: under the premise of not shaking cash flow or taking systemic risks, continue to do multiple small-scale experiments.

In the long run, what you need is such a mechanism: keep trying, accept failure. In the field of innovation, if the hit rate can reach 10%–20%, it's already a very high level.

Joe Zhou: With changes in the market environment, what core judgment have you changed recently?

Leonard: In fact, change is the norm, especially in a relatively new field. How to turn correctly is an extremely important decision-making ability for entrepreneurial teams.

Projects have different demands at different stages. For example, at the beginning, we pursued TVL (Total Value Locked) and trading volume, so we launched many aggressive incentive plans to attract users. But as several competitors completed their TGE, the market's expectations changed. People no longer believe in absolute transaction volume numbers—instead, they look through the numbers to examine "user quality."

So our current focus has shifted from simply pursuing TVL to deeply focusing on OI (Open Interest). What we really care about now is: how to screen the highest-quality users in the funnel, create an extreme experience for them, and make them willing to stay and pay fees continuously even without any airdrop expectations.

Joe Zhou: How big is the role of market makers in your system? What requirements do you have for market makers?

Leonard: Exchanges essentially do the business of "selling liquidity," and market makers are the core suppliers of liquidity. So they are definitely a very important link.

For mainstream leading coins with sufficient competition, the importance of a single market maker may be decreasing. But for the RWA (such as on-chain stocks, commodities, precious metals, oil) and other long-tail assets we've been focusing on recently, market makers are extremely important—because the initial liquidity of these assets on-chain is very scarce.

For market makers, our requirements are not just about placing orders—we value their cross-border hedging capabilities more. Market makers usually don't take unilateral risks; when they take a retail user's long position on oil on Aster, they must have the technical ability to instantly cross into the traditional financial world (such as CME Group) and hedge the position at extremely low cost. Market makers that can provide such cross-border hedging infrastructure are relatively scarce now, which is their biggest competitive advantage—many exchanges need this ability.

Squeeze Out Bubbles, Separate the Wheat from the Chaff

Joe Zhou: What do you think is the biggest "pseudo-demand" in Web3?

Leonard: This question may offend many people, but if you ask me, my consistent view is: decentralization for the sake of decentralization is the biggest pseudo-demand.

Users will never pay simply for the word "decentralization"—they pay for the actual product experience. DEXs in the previous two cycles may have been extremely decentralized in architecture, but they were eventually abandoned by users because of slow transaction speed, high slippage, and expensive fees.

This is why this round of Perp DEXs can take off. Because in terms of experience, we have reached the same level as CEXs, or even better in some aspects. Only when conditions like speed, depth, and fees are met will your "decentralization (self-custody of funds, public verifiability)" become a decisive advantage. If you sacrifice experience to pursue pure decentralization from the beginning, it's destined to be a self-indulgence.

Joe Zhou: Then in your opinion, which demands in the industry are seriously overestimated? Conversely, what are the real demands verified by the market?

Leonard: Instead of judging who is overestimated, it's better to look at what is truly verified. Perp (perpetual contracts) has been proven to be a real demand that is verified by the market and is the simplest and most efficient.

It removes the complexity of settlement in traditional options or delivery contracts—you can go long or short as long as there is oracle price feeding. Now people find that even trading oil and gold with Perp is so smooth. This is a real demand product that truly solves pain points.

Joe Zhou: When meeting these real demands, why did both Hyperliquid and Aster finally choose to build an L1 mainnet? Is L1 necessary and irreplaceable? Can't L2 do it?

Leonard: In fact, this cycle has proven a reality: users don't care whether you are L1 or L2 at all. What really matters is—whether users have a perceived cost. The ideal state is that users are so smooth when trading that they don't even need to know whether you are L1 or L2. That's the best experience.

Under this premise, the advantage of building a self-developed L1 is: stronger customization ability, higher system elasticity, and more room for trade-offs in performance and design.

It's not that L2 can't do it, but if you develop on a general-purpose L2, you face a real problem: you have to make many compromises and trade-offs in performance. For us, there is a clear bottom line: no matter how we trade off, we can't sacrifice user experience. So for the sake of extreme matching speed and privacy features, building an independent L1 at the current stage is a more reasonable path.

Joe Zhou: Is there really no chance for L2?

Leonard: Not necessarily. The interesting thing about this industry is—if a team really captures a certain ignored user pain point, even if it's on L2, it may achieve 5x or 10x user growth in a very short time.

So what ultimately determines the outcome is not the "technical route" itself, but who can find the "right business answer" earlier and more accurately.

Talking About Hyperliquid: Our Common and Larger Competitor Is CEX

Joe Zhou: People often compare Aster with Hyperliquid. What do you think are the core differences between the two?

Leonard: Hyperliquid has many things worth learning from. But the DEX market is large enough to accommodate multiple players serving different segments.

In the long run, Hyperliquid has chosen a more "ecological" development route, emphasizing absolute permissionlessness and treating everyone equally, making it easy for frontends and various asset partners to access fairly. Our focus, on the other hand, is to break through "trading experience and product innovation" inward. Specifically, there are three dimensions of differences:

First, differences in service philosophy. Hyperliquid takes a geek route; our team is larger and has heavier operations. We are willing to provide more warm guidance for retail users in the community and provide VIP customized services with extremely smooth docking for large investors.

Second, differences in asset strategies. We believe that the crypto industry's genes naturally have a craving for high-volatility assets. So while embracing traditional RWA (Real-World Assets), we will more aggressively launch some early, high-volatility small coin targets. For some targets, you may really only find liquidity on Aster.

Third, our core barrier—privacy. Many people don't realize the importance of privacy in daily life, just like you wouldn't post your bank statements in the square. Once institutions and large investors experience private trading on-chain, they can never go back.

In fact, the two platforms taking different customized routes is a good thing for the entire Perp DEX track. Because our common and larger competitor is actually centralized exchanges (CEXs), and our ultimate goal is to find