The Reconstruction War of On-Chain Transactions: The Underlying Changes, Who is Really Competing?

From on-chain integration to on-chain rewriting, DeFi has started to tinker with the underlying layers again.

In the DeFi Summer of 2021, everyone was issuing tokens, mining, and making minor innovations; in 2023, DeFi has begun to be restructured again. But this time, it’s not about module integration or gameplay innovation, but rather about "rolling back" layer by layer from the bottom.

You will find more and more projects questioning rather than building the previous generation of wheels:
"Is this wheel designed incorrectly?"

Thus, in terms of on-chain trading, two routes have begun to emerge:

• Either do everything yourself: I’ll build the chain, write the matching, and handle wallet interactions.

• Or only write the most basic components, modularize everything, and let others combine them into a system.

Today, let's talk about this ongoing battle of underlying reconstruction. It’s not about discussing projects, but rather examining what problems these projects are solving and why we should care about this trend.

Question 1: Why is on-chain trading still not done well?

On-chain trading began its revolution with AMM (Uniswap), which once broke through the market-making threshold but also shattered efficiency.

If you want depth, you lose efficiency; if you want efficiency, matching must revert to centralization.

In recent years, on-chain trading has attempted to upgrade from AMM to "on-chain CEX," but the results have either been L2 (cheap gas but no users) or building chains (built chains but no one connects), and ultimately everyone discovered that the problem is not TPS, but rather:

• Matching and clearing settlement are not decoupled.

• Liquidity is fragmented between chains and DEXs.

• Cross-chain trading experience is extremely poor, with cumbersome wallet interactions.

Therefore, the current direction is not "a better DEX," but rather directly rebuilding the trading system foundation.

Hyperliquid: On-chain trading system, perhaps it should not be layered at all

Hyperliquid's approach is: do not separate L1/L2, do not separate matching/settlement, but rather create a native high-performance chain that integrates matching and trading modules directly into the chain logic.

The benefits are:

• Matching is handled on-chain, trading is verifiable.

• No reliance on Sequencer, and no external clearing nodes.

• All assets and liquidity are aggregated in a unified account system.

In simple terms:

"It’s not just a DEX on-chain, but the chain itself is the exchange."

This idea is somewhat like looking at Solana, but without the VM, directly customized for trading. The cost is high coupling and poor scalability, but the experience is truly smooth.

Orderly is more like a multi-chain version of Hyperliquid, following the route of encircling the city from the countryside—it's not about one chain dominating, but using modularization and multi-chain layout to allow more chains and projects to access "native exchange" level performance and liquidity.

Ethena: Synthetic assets, creating on-chain dollar savings accounts without stablecoins

Ethena is not solving trading problems, but rather the issue of stablecoins + on-chain interest rates.

USDe is essentially not a stablecoin, but a delta-neutral combination using ETH/BTC and perpetual hedging shorts:

• Value preservation relies on hedging.

• Returns depend on funding rates and arbitrage opportunities.

• Pricing is controlled through an incentive mechanism that governs mint/redeem liquidity.

This logic is not new, but Ethena has packaged it with strong operational design into:

"On-chain dollar savings accounts" + "entry for stable returns."

The key is that it does not rely on centralized reserves or bonds, but rather creates a consumer-grade product based on on-chain asset combinations + perpetual contracts, implementing an on-chain Cash & Carry strategy. Moreover, it allows everyone to participate in DEX, creating more returns and possibilities.

In short, Orderly is "a DIY toolbox for ordinary people to access the stablecoin ecosystem and decentralized exchanges."

Orderly: Not building products, but writing "standard components for on-chain trading"

Orderly has chosen a third path: modular trading infrastructure.
It does not self-develop the entire chain like Hyperliquid, nor does it turn financial strategies into products like Ethena, but rather breaks down the on-chain trading system into multiple combinable "standard parts" for projects to freely assemble. Its core philosophy is: to build reusable, verifiable, and aggregable trading components that serve the entire multi-chain DeFi ecosystem.

Key designs of Orderly include:

• Centralized matching + on-chain settlement: ensuring performance off-chain while achieving transparency and verifiability on-chain;

• Multi-chain liquidity aggregation: mainstream chains like Base, Arbitrum, Optimism, and Solana can seamlessly connect, achieving a unified account system and cross-chain asset circulation;

• Modular trading engine: core capabilities such as matching, clearing settlement, risk control, and liquidity distribution can be independently deployed and freely combined;

• Shared order book across projects: not every project builds its own liquidity pool, but rather achieves system-level order book sharing, breaking down liquidity silos from the ground up.

It is particularly noteworthy that Orderly is currently one of the few high-performance trading systems that can natively integrate Solana. Solana is known for its extreme performance, but its architecture is not compatible with EVM, making it difficult for many multi-chain DeFi projects to effectively incorporate it. Orderly replicates the "centralized exchange-like" trading experience on Solana through a unified account structure and modular abstraction—this not only fills the gap in high-performance chains for multi-chain trading systems but also introduces a new paradigm of shared liquidity and modular trading infrastructure to the entire Solana ecosystem.

In other words, Orderly transforms Solana's performance into "part of a multi-chain system," rather than "a special capability of an isolated chain."

Orderly does not create end products but serves builders of perp projects, market-making vaults, stablecoin protocols, etc., providing standardized trading frameworks.
Just as Stripe provides payment infrastructure for Web2, Orderly aims to be the "standard components for trading services" on-chain, allowing developers to avoid reinventing the wheel while still achieving professional exchange-level performance and modules.

In the Solana ecosystem, Orderly has deeply integrated with Raydium, aggregating spot and perpetual trading liquidity for core assets like SOL, USDC, and USDT through a unified order book, achieving an almost zero slippage trading experience, truly bringing "centralized-like smoothness" into the on-chain world.

This is not only a technical integration but also a successful implementation of the modular trading system concept. Through deep integration with Raydium, its unified order book supports both spot and perpetual liquidity, significantly reducing users' trading costs and slippage, and bringing unprecedented systemic liquidity aggregation to Solana. This model is gradually becoming a template for building multi-chain trading infrastructure on high-performance chains, allowing builders to enjoy trading experiences comparable to CEX for the first time on Solana.

So what is OmniVault? Just a side product

Since you are building infrastructure, how can retail investors participate? Orderly provides a side entrance: OmniVault.

Essentially, it is:

• Users deposit USDC.

• Market makers like Kronos use it for trading.

• Returns are distributed back to LP users.

• All fund allocation and strategy execution are fully visible on-chain.

• Of the trading fees collected by Orderly, 40% will reward Vault LPs, and 60% goes to stakers.

It’s not mining, nor does it rely on token incentives; it uses real trading profits to reward liquidity participants.

This is completely different from the early DeFi logic of "pulling liquidity through subsidies," and is more akin to HFT strategy funds in traditional finance—just transformed into an on-chain version with lower barriers to entry.

DeFi is not getting simpler, but increasingly "system-engineered"

Today's DeFi is far from the "tweaking contracts and mining" scenario of 2020.

Either you go full-chain self-development like Hyperliquid for extreme performance;
Or you combine on-chain tools into "real financial scenarios" like Ethena;
Or you build standard components like Orderly, allowing others to quickly assemble products.

None of these three approaches are right or wrong; they each address the "engineering structural shortcomings" of DeFi.

The future hit products may not necessarily build their own chains or issue their own tokens, but they will certainly leverage these structures.

If you are still concerned about "which token can rise," you may have already missed the deepest narrative of this round.
The protagonists of this round are not the tokens, but the structures themselves.