# Solana Foundation Backs Onchain Perpetual Futures, Taking Direct Aim at Hyperliquid’s Dominance
The Solana Foundation has signaled a major strategic shift by throwing its weight behind teams building fully onchain perpetual futures on the Solana network, setting up a direct confrontation with Hyperliquid, the dominant player in the crypto derivatives space. The move, confirmed on June 2, represents the most aggressive push yet by the Solana ecosystem to capture a share of the lucrative perpetual futures market.
## A Strategic Pivot Toward Derivatives
Perpetual futures, or “perps,” are the most actively traded product in cryptocurrency, generating billions of dollars in daily volume across centralized and decentralized exchanges. Hyperliquid, built on its own custom Layer 1, has emerged as the dominant force in onchain perp trading, attracting deep liquidity and a loyal user base through its low-latency order book model.
The Solana Foundation’s new initiative aims to replicate — and surpass — that success by leveraging Solana’s high throughput and low transaction costs. By backing teams specifically focused on building perp DEX infrastructure, the Foundation is signaling that derivatives trading will be a core pillar of the Solana ecosystem’s growth strategy.
“Solana has the technical foundation to support institutional-grade derivatives trading in a fully onchain environment,” the Foundation stated. “We are committed to backing builders who can deliver the speed, liquidity, and user experience needed to compete at the highest level.”
## The Hyperliquid Challenge
Hyperliquid has maintained its lead through a combination of technological prowess and first-mover advantage. Its L1-specific design allows for sub-second trade execution and a matching engine that rivals centralized exchanges. Trading volumes have consistently exceeded $5 billion daily, with the platform generating substantial fee revenue.
However, Solana’s ecosystem developers believe that the network’s parallel processing architecture and growing DeFi composability offer a compelling alternative. Several perp DEX projects are already operational on Solana, including platforms with advanced features like leverage trading, hedging instruments, and sophisticated order types.
“Competing with Hyperliquid isn’t just about speed — it’s about liquidity bootstrapping and user experience,” noted a Solana ecosystem developer. “The Foundation’s backing could be the catalyst that brings institutional market makers onto Solana perp platforms.”
## Market Implications
The announcement has generated significant buzz within the Solana community, with developers rushing to submit proposals for the Foundation’s new grant program dedicated to derivatives infrastructure. Early reports suggest that several established trading firms are evaluating whether to deploy liquidity on Solana-based perp DEXs.
For SOL holders, the development is broadly bullish. Successful capture of derivatives volume would drive transaction fee revenue to the network, potentially increasing demand for SOL as a gas token. Additionally, the Foundation’s explicit commitment to the sector signals long-term confidence in Solana’s technical capabilities.
SOL has been trading around $97, with some analysts suggesting that a successful perp DEX strategy could push the token toward $110-$120 in the medium term.
## The Bigger Picture
The push for onchain perps is part of a broader trend toward derivatives moving onchain as DeFi infrastructure matures. Traditional futures and options markets worth trillions of dollars remain largely offchain. Solana’s attempt to bridge that gap could significantly expand the total addressable market for decentralized finance.
The Foundation is expected to announce the first cohort of backed projects within the next two weeks, with several teams already in advanced discussions.
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### FAQ
**What is Solana Foundation doing with perpetual futures?**
The Solana Foundation is backing development teams building fully onchain perpetual futures platforms on Solana, aiming to challenge Hyperliquid’s dominance in the crypto derivatives market.
**Why is Hyperliquid the target?**
Hyperliquid is the current market leader in onchain perpetual futures trading, processing billions in daily volume. Solana aims to leverage its high-speed, low-cost infrastructure to capture market share.
**How would this affect SOL price?**
Successfully capturing derivatives volume would increase transaction fees on Solana, potentially driving demand for SOL as both a trading asset and gas token. Analysts see upside toward $110-$120 if the strategy succeeds.
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*Meta description: Solana Foundation backs onchain perpetual futures development, challenging Hyperliquid’s dominance in crypto derivatives trading with Solana’s high-speed infrastructure.*
*Focus keyword: Solana perpetual futures*
