Lyra, the automated market maker (AMM) designed for crypto traders to trade options, has taken a significant step forward with its integration into the Arbitrum network. With the successful launch of its Newport upgrade, Lyra has become a multichain protocol, expanding beyond its initial Ethereum layer 2 chain Optimism. The integration with decentralized exchange GMX perpetuals, a derivative trading product without an expiration date, has further enhanced Lyra’s capabilities.
The decision to expand to Arbitrum and integrate with GMX perpetuals was driven by the recognition of distinct communities forming on each chain. By providing support for both Arbitrum and Optimism, Lyra ensures that users on either chain can benefit from its innovative AMM. “Paul,” a core contributor for Lyra, explained, “We realized it doesn’t really make sense to just wall ourselves off to only one subset of users.” This move reflects Lyra’s commitment to inclusivity and its aim to serve a broader audience within the crypto community.
Before the Newport upgrade, Lyra’s market maker vaults (MMVs) incurred swapping fees for every collateralization and hedging trade. This process, although necessary, was inefficient and resulted in lowered yields for liquidity providers. With the upgrade, Lyra’s MMVs no longer need to swap the base asset (such as ETH) for every option contract, significantly improving capital efficiency. Instead, options are now partially collateralized in cash, while Lyra hedges its exposures using GMX perpetuals as a source of liquidity. This optimization reduces costs and passes on the savings to liquidity providers, resulting in higher yields from the same trading volume.
Since the Newport upgrade, Lyra has experienced remarkable growth. The platform achieved a significant milestone with total notional trading volume surpassing $1 billion on January 16. Moreover, in the past 30 days alone, Lyra’s trading volume has increased by an impressive 8.4%. These numbers highlight the growing demand for options trading and the appeal of Lyra’s user-friendly and efficient platform.
The integration with Arbitrum and the use of GMX perpetuals demonstrate Lyra’s commitment to staying at the forefront of innovation in the crypto space. By expanding its reach and capitalizing on the distinct advantages offered by different chains, Lyra aims to provide its users with a seamless and rewarding trading experience. As a multichain protocol, Lyra empowers crypto traders to access its AMM capabilities, regardless of their preferred chain or community.
As Lyra continues to enhance its offerings and explore new opportunities, it is poised to make a lasting impact on the options trading market. Traders can look forward to improved capital efficiency, reduced fees, and an enhanced user experience. With Lyra leading the way in AMM-powered options trading, the crypto community can expect exciting developments in the months to come.
To learn more about Lyra and explore its options trading features, visit the platform’s website and stay up-to-date with its latest updates and developments.
