Paradex: A Decentralized Perps Exchange with Zero-Fee Trading and ZK Privacy

Paradex is a decentralized perpetual futures exchange that offers zero-fee trading with built-in ZK privacy on its custom Layer 2 blockchain, Paradex Chain. This platform is incubated by Paradigm, an institutional derivatives network that has processed over $1 trillion in trading volume.

The growth during Season 2 of its XP rewards program tells the story best. Average daily volume grew from $68 million to $2.1 billion (a 31x increase), open interest jumped from $28 million to $679 million (24x), TVL climbed from $25 million to $218 million (9x), and total users grew from 4,100 to over 70,300 (17x).

Paradex's zero-fee model is built into the platform's revenue structure through a system called Retail Price Improvement (RPI). Professional market makers post quotes visible only in the Paradex UI, hidden from APIs. These quotes match exclusively against retail traders. In exchange for access to this clean, non-toxic flow, makers pay Paradex a micro-fee.

The platform's privacy features are also notable. Using end-to-end ZK encryption across Paradex Cloud, the L2 chain, and Ethereum settlement, only account holders can view their positions, entries, exits, liquidation levels, and PnL. This removes the attack surface of public ledgers, allowing whales to build positions without broadcasting their strategy.