Derive Launches V3 Upgrade to Transform Onchain Options Trading

Derive, previously known as Lyra Finance, has announced a significant upgrade to its onchain options and perpetual contracts platform, transitioning from its existing Layer 2 architecture to a zero-knowledge model on the Ethereum mainnet. This upgrade, termed V3, aims to enhance the platform's capabilities and is detailed in a Derive Improvement Proposal (DIP). The new architecture will replace the current Layer 2 chain with a high-performance matching engine and sequencer operating within a zero-knowledge virtual machine (zkVM), allowing for efficient transaction processing and verification directly on Ethereum's Layer 1.

The V3 upgrade is designed to handle substantial transaction volumes, potentially reaching hundreds of billions of dollars daily while accommodating thousands of cross-margined positions per portfolio. As part of the transition, all existing positions and balances from the previous version will migrate to V3, and a new token, stDRV, will be introduced on the Ethereum mainnet. The upgrade also includes features such as 'risk universes' for improved risk management, two-sided lending for enhanced flexibility, and native vault support for structured product development.

Derive currently holds a dominant position in the onchain options market, with approximately $2 billion in open interest and a market share of about 95% by premium volume. The platform has processed over $28 billion in notional volume historically and has maintained a strong security record without incidents of insolvency. The V3 upgrade is expected to further solidify Derive's leadership in the market, making options trading more accessible and efficient for a wider range of traders.

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Source: KLEA News