The following is a guest post by Nischal Shetty, co-founder and President at Shardeum.
On 2nd January 2026, an anonymous trader on crypto prediction platform Polymarket put down roughly $30,000 on a contract that Nicolás Maduro would be out of power by 31 January 2026. Within hours of a U.S. special forces raid that resulted in Maduro’s capture, that position was worth more than $436,000. Meanwhile, traders had placed over $10.5 million on related bets about a U.S. invasion this year, many tying outcomes to specific deadlines in January, March, and December. Some participants staked tens of thousands of dollars on these geopolitical questions. Polymarket has since refused to settle certain contracts, triggering accusations of arbitrary rule-making and regulatory gaps around event definitions in prediction markets.
That episode illustrates a broader shift that came into focus in 2025. Instruments once confined to fringe corners of crypto trading, like onchain perpetual contracts and crypto-based prediction markets, crossed a threshold from niche experiments to high-volume, mainstream infrastructures. Volumes surged. Execution and liquidity matured. Distribution broadened beyond specialist desks into consumer wallets and messaging apps.
The Polymarket controversy is not an outlier. Retail participation in derivatives and leveraged products is already high. Appetite for speculative markets is proven. Regulatory clarity remains unresolved. When geopolitical outcomes and leveraged exposures are tradable with a tap, users will engage.
The change in 2025 was not in demand. It was in Structure. Infrastructure finally stopped being the bottleneck.
Infrastructure Stopped Being the Bottleneck
The single most important shift in 2025 was architectural.
Leading decentralized perp platforms moved away from shared, general-purpose blockchains toward purpose-built environments. Hyperliquid launched its own custom Layer 1. dYdX migrated from Ethereum to a Cosmos-based appchain. Others followed similar paths.
This allowed platforms to control execution end-to-end. Latency dropped to sub-second levels. Gas fees disappeared from the user experience. Order books updated in real time. Liquidations became predictable rather than chaotic.
For leveraged trading, these details are decisive. A few hundred milliseconds can determine profit or forced liquidation. By 2025, decentralized perps largely closed the performance gap with centralized venues.
Liquidity Design Mattered More Than Raw Speed
Speed alone did not drive adoption. Liquidity engineering did.
Earlier decentralized perpetual platforms relied on thin order books or external market makers. That model failed during volatility, when slippage spiked and trades failed. Trust evaporated quickly.
In 2025, platforms redesigned liquidity from first principles.
Some introduced internal matching systems that netted long and short positions before tapping shared liquidity. Others used LP-backed pools that guaranteed execution at oracle prices, eliminating slippage for most users. A few allowed yield-bearing collateral, lowering the effective cost of leverage.
These changes improved capital efficiency and user outcomes simultaneously. Traders got reliable execution. Liquidity providers earned steadier returns. Volume became persistent rather than episodic.
Distribution Changed Everything
The most underappreciated shift in 2025 was distribution.
Perpetual futures stopped being something users had to “go to.” They became features embedded in products users already used.
Wallets like MetaMask and Phantom integrated perp trading directly. Telegram emerged as a major distribution channel through trading mini-apps embedded in chats. Aggregators abstracted away venue selection entirely.
This collapsed onboarding friction. Users no longer bridged assets, managed gas, or learned new interfaces. They traded leverage from the same place they stored assets or communicated.
The result was a surge in first-time leverage users. This was not just more volume from professionals. It was a broadening of the user base.
For India, this is especially relevant. Telegram penetration is high. Wallet adoption is growing. When leverage becomes one tap away, market participation scales quickly—for better and for worse.
Asset Expansion Widened the Market
Crypto-only perps capped growth.
In 2025, several decentralized platforms expanded into synthetic exposure for foreign exchange, commodities, and equities. Traders gained 24/7 access to global markets with leverage levels often unavailable in traditional retail channels.
This unlocked new demand, particularly in emerging markets where access to global derivatives is restricted or expensive. It also introduced sharper regulatory questions around investor protection, disclosures, and risk controls.
From a market-structure perspective, decentralized perps began to resemble a parallel global derivatives layer rather than a crypto-specific product.
Regulation Lowered Existential Risk
Regulation did not cause this growth. But it reduced the probability of sudden failure.
In the U.S. and other major jurisdictions, clearer frameworks around stablecoins and settlement assets reduced uncertainty. Regulators signaled engagement rather than blanket hostility. Institutions gained enough comfort to experiment.
For India, the contrast is stark. Domestic exchanges operate under heavy restrictions. Offshore platforms attract Indian users without local oversight.
Ignoring them does not reduce risk. It shifts it elsewhere.
Why 2025 Was the Turning Point
Each of these elements existed before. What changed was their convergence.
Infrastructure matured. Liquidity models improved. Distribution went mainstream. Regulatory uncertainty declined. Trading conditions rewarded active participation.
Together, they pushed decentralized perps from theory into reality.
What Comes Next
The risks are obvious. Embedded leverage increases the chance of retail harm. Product design choices now carry regulatory and reputational consequences. Enforcement gaps will be tested.
Competition will intensify. Speed will no longer be enough. Trust, risk tooling, and user protection will differentiate winners.
For policymakers and financial institutions in India, the lesson is not that decentralized exchanges will replace incumbents tomorrow. It is that global market structure innovation is happening outside traditional rails, at scale.
In 2025, crypto’s most aggressive market grew up. India cannot afford to look away.
Disclaimer – this was a promoted (paid) post as part of our Thought Leadership program for contributors.
