This content originally appeared on HackerNoon and was authored by Ishan Pandey
Can a Trading Platform Justify Putting All Its Eggs in One Basket?
Most protocols operating across multiple chains face a dilemma. Do you spread resources thin to maintain presence everywhere, or concentrate firepower where you already dominate? gTrade, the decentralized perpetual trading platform from Gains Network, has chosen the latter with its “Trick or Trade” Halloween contest.
\ The numbers tell the story. gTrade operates on multiple blockchains, yet the platform is directing its entire $400,000 contest budget to Arbitrum alone. The competition runs from October 22 through November 19, split evenly between two categories: a P&L competition and a volume competition, each offering $200,000 in prizes. This is not sponsored money from Arbitrum Foundation. This is protocol funds.
\ “We designed this competition to celebrate our Arbitrum traders and continue building on the network where our liquidity is strongest,” said Nathan, Project Lead at Gains Network. The statement points to a broader strategy that goes beyond a single contest.
The Context Behind the Consolidation Move
gTrade has processed over $113 billion in lifetime trading volume across 3 million trades with 39,000 users. The platform offers 290+ trading pairs spanning crypto, forex, stocks, indices, and commodities. Yet despite this multi-chain presence, Arbitrum has emerged as the clear winner for liquidity and volume.
\ The relationship between gTrade and Arbitrum deepened through incentive programs. The platform received 4.5 million ARB through the STIP (Short-Term Incentive Program) in late 2023 and early 2024. This was followed by an additional 2.25 million ARB via STIP.B, bringing total incentives to 6.75 million ARB tokens. For context, Arbitrum’s STIP distributed 50 million ARB to active protocols, making gTrade one of the larger recipients.
\ These incentives drove measurable results. During the STIP period in early 2024, gTrade’s trading fee rebates exceeded 90% for two consecutive weeks, making it one of the most cost-efficient perpetual DEXs. The platform saw 4,741 new traders in January 2024 alone and processed $4.31 billion in trading volume that month. By Q1 2024, gTrade had surpassed $60 billion in total volume.
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What the Contest Structure Reveals About Platform Priorities
The Halloween contest features two parallel tracks. The P&L competition awards $200,000 to the top 100 traders ranked by realized or withdrawn profit and loss across all trading pairs. This includes both standard crypto pairs and what the platform calls RWA (Real World Assets) and DEGEN markets. All positions must open and close on Arbitrum using USDC as collateral.
\ The volume competition takes a different approach. It also offers $200,000, but rewards cumulative trading volume with a time-weighted multiplier that favors positions held longer. This structure discourages wash trading and encourages sustained engagement rather than quick flips.
\ Both categories require USDC collateral, which reflects the platform’s multi-collateral architecture introduced in v7 in early 2024. The platform previously operated primarily with DAI, but expanded to include WETH and USDC. By March 2024, these new collateral options accounted for over 20% of protocol volume.
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The Broader Perpetual DEX Landscape in 2025
To understand this move, consider the competitive environment. Decentralized perpetual exchanges have exploded in 2025. The sector processed $342 billion in December 2024, up 872% from $33.3 billion in fall 2023. By late 2025, monthly volumes regularly exceed $850 billion.
\ Hyperliquid dominates with 16.94% market share, processing $200 billion monthly. dYdX holds 14.37%, while SynFutures claims 14.11%. Jupiter on Solana has carved out 6.70%. These platforms compete on execution speed, fees, and liquidity depth. DEXs now capture 4-6% of global perpetual trading, up from 1% in 2022.
\ Trading contests have become standard in this environment. Bybit’s WSOT 2024 offered $10 million, attracting 117,000 traders. BTCC ran a competition with $10 million. Binance’s Traders League featured over $10 million in rolling prizes. Against this backdrop, gTrade’s $400,000 is modest but focused.
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Understanding the Technical Foundation
For those unfamiliar, perpetual contracts are derivative instruments that allow traders to speculate on asset prices without expiration dates. Unlike traditional futures that settle on specific dates, perpetuals use funding rates to keep contract prices aligned with spot markets. Traders can use leverage, meaning they control positions larger than their collateral. gTrade offers up to 1000x leverage on some pairs, though most traders use more modest multiples.
\ Arbitrum is a Layer 2 scaling solution for Ethereum. It processes transactions off the main Ethereum chain, then bundles them for final settlement on Ethereum. This approach reduces costs while maintaining Ethereum’s security. Transaction fees on Arbitrum typically run a few cents compared to dollars or more on Ethereum mainnet.
\ Liquidity refers to how easily assets can be traded without affecting price. Deep liquidity means large orders execute without significant slippage. Shallow liquidity causes price impact. For perpetual platforms, liquidity determines maximum position sizes and execution quality. This is why consolidation matters.
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The Economics of Self-Funding vs Sponsored Contests
gTrade is using protocol funds, not external sponsorship. This distinction matters. When a platform self-funds a contest, it signals confidence in return on investment. The platform expects increased trading volume to generate fees that exceed the prize pool cost.
\ gTrade generated $24.5 million in revenue in 2024 from $32.5 billion in trading volume. The platform charges fees on position size, with percentages varying by market type. Revenue doubled from Q3 to Q4 2023 despite only 12% volume growth, demonstrating improved monetization through tokenomics changes.
\ A $400,000 contest over four weeks represents about 1.6% of annual 2024 revenue. If the contest generates even a modest sustained increase in trading volume, the investment pays for itself through fee capture. The calculation becomes more favorable when considering that contest participants often continue trading post-event.
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The Liquidity Fragmentation Problem in Multi-Chain DeFi
Operating across multiple chains creates what developers call the liquidity fragmentation problem. Imagine a pool with $10 million spread across five chains versus concentrated on one. The fragmented version has $2 million per chain. Large traders face slippage on each individual chain. The concentrated version handles bigger orders efficiently.
\ gTrade surpassed $85 billion in lifetime volume by early 2025. But volume distribution matters as much as total volume. If Arbitrum already handles the majority, directing contest activity there reinforces the network effect. More traders attract more liquidity providers. More liquidity attracts more traders. The flywheel accelerates.
\ This strategy runs counter to prevailing multi-chain narratives. Most platforms emphasize chain abstraction and seamless cross-chain experiences. gTrade is doing the opposite with this contest, doubling down on where it already wins.
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What Trading Volume Data Tells Us
Historical performance provides context. In January 2024, gTrade averaged $120 million daily volume before finishing at $4.31 billion monthly. February 2024 saw total volume reach $60 billion lifetime. Q1 2024 marked the most successful quarter in platform history.
\ These numbers coincided with the STIP incentive period on Arbitrum. The correlation suggests Arbitrum-specific incentives drove platform-wide growth. This Halloween contest essentially continues that approach using protocol treasury rather than foundation grants.
\ By November 2022, the platform had already seen record adoption, with profit distribution increasing 48.9% month-over-month despite minimal volume increases. The pattern repeats: concentrated liquidity drives efficiency, which drives profitability.
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The Competitive Response and Market Position
gTrade maintains a position in the top 10 perpetual DEXs by volume. The platform differentiates through asset diversity. While competitors focus heavily on crypto pairs, gTrade offers 35 forex pairs, commodities including oil and precious metals, and tokenized stocks. This product breadth attracts different trader types.
\ The platform surpassed GMX in single-day revenue during early 2023, demonstrating its competitive positioning. GMX received $13.8 million in STIP incentives, compared to gTrade’s 6.75 million ARB. Both platforms benefited, but took different approaches to deployment.
\ The perpetual DEX sector hit $1.18 trillion in Q2-Q3 2024 volume across all platforms. gTrade’s share of this market depends on maintaining competitive advantages in execution, fees, and available markets. The Arbitrum consolidation strategy addresses one piece: liquidity depth.
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Risk Management and Position Sizing
The contest structure incorporates safeguards. The P&L competition requires realized or withdrawn profits, meaning traders cannot game rankings with unrealized paper gains. The volume competition’s time-weighted multiplier discourages wash trading, where traders rapidly open and close positions to inflate volume without taking real directional bets.
\ Both approaches reward sustained, thoughtful trading over manipulation attempts. This matters for platform integrity. Contest abuse damages platform reputation and can destabilize liquidity pools if participants game the system at scale.
\ gTrade uses Chainlink price feeds for live pricing, which provides additional manipulation resistance. The platform implemented zero price impact on BTC and ETH trading in early 2024, eliminating one avenue for gaming. These technical implementations complement contest design.
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The Token Economics Behind the Decision
gTrade operates with a native GNS token that captures protocol value. The platform directed nearly $17 million to GNS holders in 2024 through buybacks, staking rewards, and burns. This represented over 30% of the token’s market cap at the time.
\ GNS stakers receive 60% of protocol earnings since the tokenomics upgrade. Staking yields exceeded 15% in Q4 2023. Higher trading volume drives higher fees, which flow to token holders. The contest investment ultimately serves token value appreciation through increased activity.
\ The decision to self-fund from protocol treasury demonstrates confidence in this flywheel. If the contest merely redistributed existing trader volume without growth, it would represent pure cost. The bet is on volume expansion and trader retention beyond the contest period.
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Platform Evolution and Feature Development
Understanding the contest requires knowing platform capabilities. gTrade launched v7 in early 2024, introducing multi-collateral support and gToken vaults. gToken TVL reached $45 million by February 2024, with 10.8% in USDC and 14.3% in WETH.
\ Version 8 introduced smart contract trading for improved composability. The update removed position limits and reduced gas fees by 20-30%. Version 9 added collateral management, allowing traders to add collateral to existing positions to avoid liquidation.
\ Looking ahead to 2025, the platform plans chain abstraction allowing seamless access to Arbitrum liquidity from any chain. The Halloween contest thus represents a bridge period. Build deep liquidity on one chain now, then make it accessible everywhere later.
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gTrade 400,000$ Trading Contest
The contest runs 29 days from October 22 to November 19. This timing catches the tail end of October and most of November. Crypto markets often see increased volatility during this period as year-end positioning begins. Higher volatility typically drives trading volume as participants react to price movements.
\ November also represents a seasonally strong period for crypto attention. The timing avoids major holidays while capturing increased market interest before year-end slowdowns. The four-week duration provides enough time for strategies to play out while maintaining urgency.
\ The start date of October 22 follows the October 17 announcement by one business week. This gives traders time to prepare accounts, fund collateral, and develop strategies without excessive waiting.
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Final Thoughts and Analysis
This contest reveals more about platform strategy than any single announcement could. gTrade is making a calculated bet that concentrated liquidity trumps broad presence. The $400,000 investment in Arbitrum-only prizes signals where the platform sees its future.
\ Several factors support this approach. The 6.75 million ARB in past incentives demonstrated that Arbitrum-focused campaigns drive meaningful growth. The platform has already established dominance there, making reinforcement more efficient than building from scratch on new chains. The perpetual DEX landscape is becoming increasingly competitive, requiring differentiation through depth rather than breadth.
\ However, risks exist. Concentrating on one chain increases exposure to that chain’s technical or governance issues. Competitors operating across multiple chains gain resilience through diversification. If Arbitrum faces unexpected problems, gTrade’s entire liquidity base becomes vulnerable.
\ The self-funding decision carries weight. Using protocol funds rather than seeking external sponsorship demonstrates confidence but also accountability. Token holders and liquidity providers will judge whether the investment generates sufficient return through sustained volume increases. The contest structure shows thoughtful design. By rewarding both P&L and volume with time-weighting and realization requirements, gTrade discourages gaming while encouraging genuine trading. This protects liquidity pools and platform integrity.
\ Looking at comparable contests, $400,000 falls well below the $10 million mega-prizes from centralized exchanges. However, it is important to note that this reflects different economics. CEXs use contests as customer acquisition costs against lifetime value from fees, spreads, and potential liquidations. DEXs operate with thinner margins and rely more on sustained volume than customer lock-in.
\ The timing aligns with broader DeFi perpetual growth. With the sector processing hundreds of billions monthly and capturing increasing market share from centralized platforms, any protocol positioned to capture this flow stands to benefit. gTrade’s Arbitrum focus attempts to capture this tide in one deep channel rather than many shallow ones.
\ Platform performance will ultimately judge this strategy. If trading volume on Arbitrum increases substantially and sustains post-contest, the approach validates. If volume remains flat or traders simply redistribute existing activity without growth, the investment will look less compelling.
\ For traders, the contest offers clear value. Top performers can capture significant prizes through either P&L excellence or sustained volume. The USDC collateral requirement and Arbitrum-only execution provide straightforward participation requirements.
\ For the platform, this represents a statement of priorities. Multi-chain expansion takes a backseat to Arbitrum dominance. This contrasts with prevailing industry narratives about chain abstraction and omnichain presence. Time will tell whether concentration or distribution proves the winning strategy in decentralized perpetual trading.
\ The Halloween theme adds nothing substantive but provides seasonal appeal. The real story lies in strategic resource allocation, liquidity economics, and competitive positioning. gTrade is betting $400,000 that its Arbitrum bet pays off. Markets will deliver the verdict through volume numbers in the weeks ahead.
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:::tip This author is an independent contributor publishing via our business blogging program. HackerNoon has reviewed the report for quality, but the claims herein belong to the author. #DYO
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This content originally appeared on HackerNoon and was authored by Ishan Pandey