Aster CEO Discusses Market Shifts and Real Demand for Perp DEX

Article by Joe Zhou, Foresight News

Interviewee: Leonard, CEO of Aster

The tide in the crypto market is quietly shifting.

In the past, you couldn’t imagine gold and oil trading volumes surpassing those of Solana or XRP on a Perp DEX. But now, these two RWA assets have firmly entered our platform’s top five trading volumes—and they’ve become the norm.

Aster CEO Leonard used a set of simple yet powerful data points to dismantle the industry’s long-standing grand narrative.

In his view, the market sentiment has shifted because users' fundamental needs have changed. Without the filter of get-rich-quick myths, people are now only willing to pay for genuine trading experiences.

Leonard stated: Today, leading perpetual DEXs have matched, and in some cases surpassed, centralized exchanges (CEXs) in terms of order matching speed, order book depth, and fee costs—thanks to their elimination of the complexity inherent in traditional delivery contracts, resulting in an improved trading experience.

“Decentralizing for the sake of decentralization is the industry’s biggest false demand,” Leonard bluntly stated. “Users will never pay simply for the four characters ‘decentralization.’ Only when your underlying experience matches or even surpasses that of CEXes will your decentralization and self-custody become truly dominant advantages.”

On the occasion of Aster’s first anniversary, we sat down with Leonard for a more unfiltered conversation—no visions, just realities: market trends, surviving the bear market, effective innovation, and how a leading DEX can make it through this cycle in a market that’s turning away from speculation and toward substance.

Joe Zhou: What has been the best-performing asset on your platform recently?

Leonard: Recently, it’s definitely gold and oil. From a growth perspective, they have the strongest momentum. Gold and oil have now entered the top five trading pairs on our platform. In the past, you simply couldn’t imagine a real-world asset (RWA) trading pair outperforming Solana or XRP on a perp DEX. But now, this is standard on our platform.

Joe Zhou: The market is constantly changing, and traders' attention shifts as well—how do you observe and capture these trends?

Leonard: Each market cycle has its own hotspots. For example, recently, with frequent geopolitical events, gold and oil have experienced significant volatility—and traders thrive on volatility. To be honest, three months ago, no one anticipated that gold and oil would become so popular on-chain.

As a long-term trading platform, our focus isn’t on guessing the next hot trend, but on building robust underlying liquidity and matching infrastructure. Our goal is to ensure that, no matter which type of asset is in cycle, the platform can quickly respond to demand and enable users to trade anytime. Although trading volumes for traditional financial assets have increased recently, we can’t rule out the possibility that, six months from now, a bull market returns and volatility in crypto assets picks up again. The key to our platform is its ability to seamlessly adapt to these changes at any time.

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

Leonard: On Aster, the proportion of institutional users has indeed increased recently.

On one hand, this is due to market conditions: during a bear market, retail investors have less active capital available, while institutional funds relying on stable arbitrage strategies are less affected. On the other hand, and more importantly, Aster’s longstanding focus on “privacy transactions” is a critical requirement for certain institutional investors.

For large holders and quantitative institutions, their strategies are absolute secrets—if made public on a transparent blockchain, they would become ineffective. With the launch of our privacy features, many institutional users have migrated their funds here specifically to address this pain point.

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

Leonard: Retail investors have shown significantly increased demand for yield-bearing assets in a volatile market.

Users are finding it increasingly difficult to profit from pure trading and are seeking a guaranteed return. For example, our platform’s USDF and the recently enhanced USD1, which now offers yield attributes, perfectly align with retail investors’ current mindset: allowing funds to earn a stable yield while still being readily available as margin for trading when opportunities arise. This is currently one of the fastest-growing areas for retail user growth.

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

Leonard: This is a question no one can answer definitively—if anyone knew, everyone would already be doing it (laughing).

But there is a clear trend: projects in this cycle are becoming increasingly grounded in business reality. In the past, many projects were driven by "narratives"—the bigger the story, the grander the vision, the higher the valuation. But that approach no longer works.

The current market values real users and real revenue: How much fee income do you generate? How much actual cash is available for token buybacks? Therefore, I believe the next cycle will increasingly resemble traditional finance in its underlying logic, with growing demands for projects to demonstrate solid fundamentals and cash flow.

Joe Zhou: Many people are saying we’ve entered a bear market. If that’s the case, this would likely be Aster’s first bear market. What advice would you give to a project team on how to navigate a bear market?

Leonard: I think it’s not just during a bear market—no matter the market conditions, cash flow is the most important lifeline for survival.

If you're a long-term builder, you need a strong product and a viable business model to attract users willing to pay. Then, you must price your product appropriately, generate revenue, and ultimately use a healthy tokenomics framework to return those earnings to holders.

By focusing solely on connecting these three key areas, a bear market becomes an ideal time for building. Without the noise of a bull market, you can more thoroughly iterate on your product and more easily attract talent who are willing to work with focus and patience. As long as you maintain positive cash flow and weather the winter, you’ll naturally reach new heights in the next bull market.

Joe Zhou: What is your current primary revenue structure?

Leonard: At its core, it’s still trading fees. Over 80% of our revenue comes from fees. That’s why we’ve repeatedly emphasized the importance of user quality—our income stems from actual trading activity; only when users trade and pay fees do we generate cash flow.

Joe Zhou: Over the past year, with so many competitors building Perp DEXs, what is the core underlying logic that enabled Aster to deliver on time, survive, and become a market leader?

Leonard: It boils down to two things: respect for risk management and a mechanism for rapid experimentation.

First is risk management. Our team has deep experience from centralized exchanges, giving us a natural emphasis on risk control. In the crypto industry, choosing the right niche is important, but what matters more is surviving. Every cycle brings new opportunities—only by making it to that moment can you have the chance to take off again.

Second, rapid iteration. Many Perp DEXs in this cycle choose to refine their products and improve metrics before launching their TGE. But looking back, the market is unpredictable. Rather than chasing the “perfect timing,” it’s better to deliver the product faster and let the market provide feedback. The market is the best teacher. Instead of endlessly internal debates, it’s wiser to launch sooner and let users vote with their feet—and let price reveal the truth. We’ve always stood by this principle: deliver first, then optimize—rather than waiting for some mythical “perfect moment.” Of course, we still seek relatively favorable windows, but we never obsess over perfection.

Another point is that outsiders often only see the few market trends we’ve successfully capitalized on, but not the many other attempts that didn’t succeed. Our approach is to continuously conduct multiple small-scale experiments without compromising cash flow or taking on systemic risk.

In the long term, what you really need is a system like this: keep trying, accept failure—in the realm of innovation, achieving a success rate of 10%–20% is already considered very high.

Joe Zhou: Given the changing market environment, what is one core assumption you’ve recently revised?

Leonard: Actually, change is the norm, especially in a relatively new field. Knowing how to pivot correctly is an essential decision-making skill for entrepreneurial teams.

At different stages, a project’s priorities change. For example, initially, we focused heavily on TVL (Total Value Locked) and trading volume, so we launched aggressive incentive programs to attract users. However, as several competitors completed their TGE, market expectations shifted. Users are no longer fixated on raw trading volume figures; instead, they look beyond the numbers to assess “user quality.”

Therefore, our current focus has shifted from merely pursuing TVL to deeply monitoring OI (open interest). What truly matters to us now is how to identify the highest-quality users within the funnel, provide them with an exceptional experience, and ensure they remain engaged and willing to pay fees consistently—even without any airdrop expectations.

Joe Zhou: What role do market makers play in your system, and what requirements do you have for them?

Leonard: Exchanges essentially operate as a business of selling liquidity, and market makers are the most critical suppliers of that liquidity. Therefore, they are undoubtedly a vital component.

On established mainstream cryptocurrencies with highly competitive markets, the importance of a single market maker may be diminishing. However, on long-tail assets we’ve recently focused on, such as on-chain stocks, commodities, precious metals, and oil, market makers are critically important, as initial liquidity for these assets on-chain is extremely limited.

For market makers, our requirements go beyond simply placing orders—we place greater emphasis on their cross-market hedging capabilities. Market makers typically do not assume directional risk; after taking on retail traders’ long positions in oil on Aster, they must possess the technical ability to instantly hedge those positions in traditional financial markets (such as the CME) at extremely low cost. Market makers capable of providing this cross-market hedging infrastructure are currently scarce, making it their greatest competitive advantage—a capability many exchanges urgently need.

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

Leonard: This question might upset a lot of people, but if you ask me, my longstanding view has been that decentralization for the sake of decentralization is the greatest pseudo-need.

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

That’s why this round of Perp DEXs has taken off—because we’ve matched, and in some areas even surpassed, the CEX experience. Only when speed, liquidity, and fees meet the necessary thresholds does your “decentralization” (self-custody of funds, publicly verifiable) become a decisive advantage. If you sacrifice user experience from the start in pursuit of pure decentralization, it’s destined to be an exercise in self-indulgence.

Joe Zhou: In your opinion, what demands in the industry are currently overestimated? Conversely, what are the genuine needs that have been validated by the market?

Leonard: Instead of judging who is overhyped, let’s look at what has truly been validated. Perps (perpetual contracts) have proven to be the simplest and most efficient real demand validated by the market.

It eliminates the complexity of settlement found in traditional options or delivery contracts—users can go long or short as long as there’s an oracle price feed. Now, people are realizing that trading oil and gold via Perps is just as seamless. This is the essential product that truly solves a core pain point.

Joe Zhou: When fulfilling these real-world needs, why did both Hyperliquid and Aster ultimately choose to build on an L1 mainnet? Is an L1 truly necessary and irreplaceable? Can’t L2s accomplish the same?

Leonard: In fact, this cycle has proven one reality: users simply don’t care whether you’re an L1 or an L2. What truly matters is whether users perceive any cost. The ideal scenario is when users experience seamless transactions—so smooth that they don’t even need to know whether you’re an L1 or an L2. That’s the best experience possible.

Under these conditions, the advantage of developing your own L1 is greater customizability, higher system elasticity, and more flexibility in balancing performance and design.

It’s not that L2s can’t do it, but if you develop on a general-purpose L2, you face a practical reality: you must make significant performance trade-offs. For us, there’s one clear bottom line: no trade-off can compromise the user experience. Therefore, to achieve optimal matching speed and privacy features, building a dedicated L1 is the more sensible path at this stage.

Joe Zhou: Has L2 really lost its chance?

Leonard: Not necessarily. What’s interesting about this industry is that as long as a team truly addresses an overlooked user pain point—even on an L2—they could achieve five- or tenfold user growth in a very short time.

Therefore, what ultimately determines victory is not the technical path itself, but who can find the right business answer sooner and more accurately.

Joe Zhou: People often compare Aster and Hyperliquid—what do you see as the most fundamental difference between the two?

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

In the long term, Hyperliquid has chosen an "ecosystem-oriented" development path, emphasizing absolute permissionlessness and equal treatment to facilitate fair access for frontends and various asset partners. Our focus, however, is on breaking through internally in terms of "trading experience and product innovation." Specifically, there are three areas of difference:

First, a difference in service philosophy. Hyperliquid takes a tech-focused approach; our team is larger and operates with a more hands-on model. We are committed to providing warm, personalized guidance for retail traders in our community, as well as seamless, customized VIP services for institutional clients.

Second, differences in asset strategies. We believe the crypto industry inherently craves high-volatility assets. Therefore, while embracing traditional RWA (real-world assets), we will more aggressively list early-stage, high-volatility small-cap tokens. Some of these assets may only be available for liquidity on Aster.

Third, and our core barrier: privacy. Many people don’t realize the importance of privacy in daily life—just as you wouldn’t post your bank statements on a public square. Once institutions and large holders experience privacy-enabled on-chain transactions, they’ll never go back.

In fact, the two platforms taking different customization paths is beneficial for the entire Perp DEX ecosystem, as our shared and larger competitor is actually centralized exchanges (CEXs)—our ultimate goal is to attract traditional CEX users.

Joe Zhou: What do you think is currently the most overvalued aspect of the Perp DEX ecosystem (including Hyperliquid and Aster)?

Leonard: I think the title of "number one" is inherently overrated.

This market is still very early. Six months ago, no one thought the top position could be challenged; but over the past period, the rankings have changed multiple times, with gaps continuously widening and reorganizing.

This precisely illustrates one thing: temporary leadership does not equate to a true moat. In this industry, no one can predict the landscape three or six months from now. What truly matters is not focusing on rankings, but whether you’ve identified a unique advantage.

Because there is still a vast amount of unverified space in this field, once you find the right direction and solve a key pain point, growth can be five or even tenfold. Becoming first is the result of doing things right, not the goal.

For us, what we think about every day isn’t how to hold onto first or second place, or fixating on a specific competitor—it’s whether we can build a product that attracts users tenfold and brings CEX users over. That’s far more important and far more interesting than watching our competitors.

Joe Zhou: How do you identify market trends and real demand?

Leonard: The first principle is to talk to your users and community as much as possible. The more you talk to them, the more you’ll develop an intuition for what they truly care about.

You need to return to first principles: What are users ultimately seeking? Simply put, they want to make money, save money, and keep their funds secure. Within this foundational framework, identify demand points that the market has overlooked.

If everyone in the market believes something is right (for example, everyone says you should get into AI), following the trend and entering AI won’t give you an advantage. Instead, leverage your cultivated market intuition and deep understanding of users to uncover real needs that most people have overlooked or haven’t yet identified correctly. This is the logic behind how we identify trends.

Joe Zhou: You've mentioned "protocol-level order books" multiple times—what is the upper limit of efficiency gains compared to smart contract-driven DEXs like Uniswap (AMM mechanism)?

Leonard: There are certainly differences in underlying TPS performance, but I believe the most fundamental distinction isn’t about speed—it’s that order books enable trading mechanics completely different from traditional automated market making (AMM).

On the order book, you can set a wider variety of order types and dynamically adjust your strategy based on the price structure of the order book depth. In the traditional financial world, for decades, everyone has operated based on this order book infrastructure, leading to the development of highly sophisticated quantitative trading models.

This is also why this round of Perp DEXs have been able to capture such a high market share—because large traders, professional quantitative institutions, and heavy trading users are naturally accustomed to and prefer trading on order books.

So, performance improvements are just one aspect. Fundamentally, if you want to migrate traditional finance quantitative teams and high-net-worth, heavy trading users onto the chain, you must provide them with the order book architecture they are most familiar with and comfortable using, rather than forcing them to change their habits to adapt to AMMs.

Joe Zhou: How has the team’s DNA changed over the past year, as it expanded from a small development group of dozens to supporting an entire public chain ecosystem?

Leonard: As the team grows, the most direct issue is that communication costs inevitably rise. To maintain our original level of execution during expansion, the biggest change we’ve made internally is to systematically quantify goals and truly delegate decision-making authority.

We still maintain an extremely flat structure. Currently, we set clear, measurable business goals for everyone and fully empower frontline teams with the authority to allocate resources and make decisions. Everyone is accountable for the same objective and has the autonomy to make judgments based on real-time conditions. We are determined not to lose agility as we grow, ensuring we can keep pace with rapid market changes.

Joe Zhou: How many people are there at Aster now?

Leonard: The exact number isn't suitable for public disclosure, but the current team size is approximately five times larger than before.

Joe Zhou: Over the past year, Aster has made the leap from a DEX to an independent L1. Which moments during this process made you feel that Aster had truly transformed?

Leonard: There are mainly three turning points.

First, we decided to implement privacy. In June last year, after internal discussions, the team developed the privacy feature in just 20 days. We had always wanted to do this, and when we saw market demand beginning to grow, we seized the opportunity and moved forward decisively.

Second, we successfully navigated the TGE (token generation event). Many people first learned about Aster because of this relatively successful token launch. At the time, market expectations for us were extremely high, and the price reflected that—creating significant pressure, a kind of “happy problem.” But after the TGE, our trading volume surged, proving that our business model works. The platform began generating stable positive cash flow and initiated token buybacks. This demonstrates that we not only identified the right market opportunity but also executed flawlessly, positioning us to thrive long-term.

Third, the recent mainnet launch. Our long-standing vision has finally been realized at the foundational level—this is a fundamental change.

Joe Zhou: Can you explain the significance of launching the mainnet? How will it differ from before?

Leonard: The most direct meaning is that we’ve turned all our past boasts into actual underlying code.

In fact, users don’t care whether you’re on L1 or L2—they just want a seamless, frictionless experience. But for our development team, building true privacy and a high-performance order book matching system would face too many performance constraints if we relied on a generic L2. Building our own independent L1 application chain gives us the highest level of底层 customization, allowing us to dedicate all our performance capabilities entirely to the trading experience.

Joe Zhou: How much money can the launch of an independent mainnet save users who are afraid of MEV?

Leonard: Being sandwiched by MEV bots on general-purpose blockchains has always been a pain for retail traders. But Aster is an independent application chain where all order matching occurs across a trusted set of nodes. Our underlying mechanism fundamentally eliminates any possibility of third-party malicious transaction reordering or MEV. This means every unit of a user’s capital is directly and fully applied to the trade itself—with no hidden losses.

Joe Zhou: You repeatedly emphasize "privacy," which often conflicts with "compliance." How does Aster manage to conceal institutional trading signals while still meeting increasingly stringent regulatory requirements?

Leonard: That’s an excellent question. Aster’s privacy is not the complete, black-box-style anonymity of traditional Monero.

Our underlying principle is to return the right to disclose data to users. On-chain, order books and fund flows are encrypted and inherently untraceable by default. However, when faced with compliance reviews, audits, or regulatory requirements, users can generate their own “View Key.” By providing this key to regulators, they can fully and transparently verify all transaction records, positions, and fund sources on the blockchain.

We have not removed the ability to verify transactions on-chain; we simply allow you to precisely choose who sees your hand. This creates a perfect compliance闭环.

Joe Zhou: What specific utilities does the ASTER token offer after the mainnet launch?

Leonard: With staking, Aster is no longer just a simple exchange platform—it becomes a true decentralized network. Stakers not only capture value from the system, but more importantly, they will participate in the decentralized governance of future features such as our upcoming "permissionless infrastructure open" initiative. In the future, stakers will determine the direction of this ecosystem’s development.

Joe Zhou: If you were to rate Aster over the past year, what score would you give it? And how do you plan to address those missed points in Q2?

Leonard: To leave room for improvement, I’m giving the team a 60 (passing grade).

This quarter, we have several major priorities: First, we are fully committed to the RWA sector—we cannot fall behind and must continue to expand our liquidity advantage in this area.

Two: Open the underlying infrastructure—enabling traditional asset issuers or AI trading agents to easily build their own front-end applications on Aster’s matching and liquidity network without permission.

Three: Driving a Mass Migration of Privacy-Seeking Users: The mainnet’s privacy features are ready; we will provide hands-on assistance to institutions and retail users with a strong demand for privacy to complete their migration.

Joe Zhou: One final question—if you had to make the same choice again and go all in on one赛道, what would you choose?

Leonard: There’s only one answer: definitely go all in on Perp DEX. In fact, that’s exactly what we’re doing every day.

In my view, deciding to go all in on any赛道 must pass two extremely rigorous tests: First, does this赛道 truly create value? Can it address real needs, establish a viable business model, and contribute back to the ecosystem? Second, what are your team’s core strengths? What gives you the edge to break into the top 5% of this赛道?

The derivatives market has an extremely high ceiling, but competition is also brutally fierce. It’s a market where the top 5% of players capture 80% of the profits. If your team can’t rank among the top 5%, no matter how attractive the opportunity or how compelling the narrative, it’s not worth betting on.

Building the foundation for trading is what our team does best—it’s in our DNA. This market is large enough, its business logic is fundamentally sound, and its value has been repeatedly proven with real money over the past two cycles. Once we’re convinced of this, we’ll commit fully and see it through to the end.