When it comes to trading, fees are often the hidden obstacle between profit and loss. Centralised and decentralised exchanges alike can impose direct fees or mask costs within spreads, slippage, or funding rates, which are expenses that eat away at traders’ earnings.
With perpetual contract trading, these fees only amplify, making it essential to find an exchange that keeps costs low. This is why Vest Exchange was created.
Built on ZKsync, Vest is a decentralised platform designed to bring fees down to nearly zero while also allowing users to grow their gains through low-cost liquidity provision. But what exactly is Vest Exchange, and what makes it different?
What is Vest Exchange?
Vest Exchange is a decentralised perpetual futures trading platform that operates on ZKync, a zero-knowledge (ZK) rollup designed to bring scalability and affordability to the Ethereum network.
Vest lets traders access a broad range of digital assets while liquidity providers (LPs) can earn returns by supplying USDC liquidity, all within a framework built on fairness, efficiency, and security.
The essence of Vest can be summed up in four essential benefits:
1. Maximum Capital Efficiency
Trade and provide liquidity with the assurance that users’ capital is being used at its fullest potential. Vest does not impose open-interest caps or arbitrary fees, ensuring users’ capital works for them. This efficiency is powered by zkRisk, the platform’s proprietary risk engine.
2. Fairest Pricing
Arbitrary fixed fees are not present on Vest, as fees are directly proportional to the level of risk. This means there’s zero price impact, slippage, or fees on trades that help reduce open-interest imbalance, making trading fairer and more predictable.
3. Proper LP Returns
LPs are rewarded with yields that directly reflect their risk in acting as counterparties to traders. Vest’s structure ensures LPs are protected, allowing them to provide liquidity with confidence that their capital remains safe.
4. Hundreds of Markets
Vest offers one of the widest asset ranges in the market, from major tokens to long-tail assets, all with the fairest pricing. This extensive offering sets Vest apart from other perpetual decentralised exchanges (DEXs) that limit asset options.
These core advantages are underpinned by zkRisk, Vest’s risk engine that ensures capital efficiency without sacrificing security. Now, let’s take a closer look at how Vest’s infrastructure makes all this possible.
How Vest’s Infrastructure Works
Vest’s design is built to handle both risk management and liquidity, which is no easy task. To do this effectively, it relies on several key components that work together seamlessly:
- zkRisk
zkRisk is Vest’s unique risk management framework. Using Entropic Value-at-Risk (EVaR), zkRisk continuously assesses the solvency requirements of the platform.
When new trades or price movements introduce additional risk, zkRisk dynamically calculates the capital needed to absorb it, adjusting fees and funding rates in response.
All calculations occur off-chain, with results submitted to an on-chain verifier for added security. This approach, powered by zkSNARKs, keeps transactions transparent and verifiable.
- Premia and Funding Rates
Vest’s premia, a dynamic trading fee, is adjusted based on the risk level of each trade. If a trade increases insolvency risk, a higher premia are charged, benefiting LPs and safeguarding the platform.
Trades that lower insolvency risk carry no premia. Funding rates are similarly adjusted, with funds distributed first to LPs and the Automated Market Maker (AMM) to ensure stability, with any surplus benefitting traders.
- AMM (Automated Market Maker)
Vest’s AMM is a buffer that provides the capital for trades, protecting LPs from riskier trades. If AMM capital is depleted, LPs temporarily cover trades until the AMM regains its balance through accrued fees. This structure reduces LP exposure, creating a safer experience.
- Order Types
Vest provides a flexible trading experience with multiple order types, including Market Orders (executed at the best available price), Limit Orders (set to a specific price), Stop-loss Orders (to limit losses), and Take-profit Orders (to secure gains).
With its AMM managing price impacts, traders face minimal slippage, creating fair pricing for all available assets when trading.
- Partial Liquidations
Vest is the first DEX to offer partial liquidations, only liquidating enough of a position to reduce insolvency risk.
This approach minimises trader losses and keeps the platform secure. Managed by Vest’s keeper bots, this process is efficient and reduces the potential impact on the users’ funds.
With an understanding of Vest’s infrastructure, let’s talk about how users can get started on trading on this platform.
How to Use the Vest Exchange
The process of setting up to trade on Vest Exchange is straightforward, similar to most decentralised exchanges in the market.
Here’s a quick guide to help users set up and start trading:
1. Connect Wallet
First, add ZKsync to MetaMask. Here’s how:
Open MetaMask, click “Add Network,” and manually enter ZKsync details:
- Network Name: ZKsync Era Mainnet
- RPC URL: https://mainnet.era.zksync.io
- Chain ID: 324
- Currency Symbol: ETH
- Block Explorer URL: https://explorer.zksync.io/
2. Fund the Wallet:
You’ll need USDC for trading and ETH for gas fees, especially when bridging assets to ZKsync. Vest’s in-house bridge streamlines transfer to fund the users’ accounts with USDC.
3. Trading
Vest currently supports 28 assets paired with USDC, allowing for 5x to 10x leverage. Vest’s 1-click trading makes the experience seamless, letting users execute trades without interacting with MetaMask each time.
ZKsync’s Paymasters make gasless transactions possible, allowing external wallets to sign transactions without additional steps.
4. Providing Liquidity:
Vest enables users to earn by becoming LPs. Connect the wallet, navigate to the “Liquidity Providing” tab, and specify the amount of USDC you want to deposit.
Vest’s AMM acts as a safety buffer for LPs, ensuring they earn consistent returns with reduced exposure to market fluctuations.
Are There Any Tokens or Rewards on Vest?
Unlike many platforms, Vest doesn’t currently have a native token, keeping things straightforward with ETH and USDC. However, a native token is a possibility in the future, though no official plans have been announced yet.
In the meantime, Vest has launched a $ZK incentive programme for active users. Starting on November 11, this programme offers up to 250,000 $ZK tokens each week, distributed based on user engagement.
This rewards campaign will run for one month, concluding on December 9, with weekly rewards distributed every Monday.
The first distribution is scheduled for November 18, and users can claim rewards directly on Vest’s platform. It’s an excellent way for users to benefit from using the platform and contributing to its growth. With these rewards in mind, Vest continues to stand out as a platform that prioritises user value.
Conclusion
Vest Exchange is changing the landscape of decentralised perpetual trading by combining low fees, transparency, and advanced risk management. Built on ZKsync, Vest brings traders and liquidity providers a platform designed around fairness, efficiency, and security.
For traders who are looking for minimal fees or an LP that earns steady returns, Vest offers a unique, user-focused experience in the DEX space.
With zkRisk at its core, transparent operations, and an active reward programme, Vest is setting a new benchmark for decentralised perpetual trading.
