The Arbitrum-based RWA perps protocol now routes net directional flow to Jump and prime brokers offchain, retiring the single-pool model that absorbed all trader risk.
Ostium Labs on Tuesday rolled out what it calls the first “decentralized execution layer,” an architectural overhaul that routes net directional flow from the protocol’s traders to a network of institutional hedging partners, including Jump, prime brokers, and other firms active in traditional markets.
Until now, Ostium’s public liquidity pool both settled trades and absorbed all net directional exposure, a structure the team said served early users but capped execution quality and open interest. Under the new model, a separate capital pool programmatically routes net exposures offchain to institutional partners and settles once daily. A buffer layer sits atop the public liquidity pool, which now operates as an intraday lending layer rather than a counterparty.
“Programmatically hedging onchain flow with traditional market participants required building a new kind of infrastructure, a translation layer between smart contracts and institutional-grade messaging protocols, with sub-100-millisecond latency across every step,” CTO Marco Antonio Ribeiro said in a press release viewed by The Defiant.
Co-founder and CEO Kaledora Kiernan-Linn has long said that orderbooks are the wrong venue for tokenized real-world assets, and that the right model is to quote directly from the underlying market.
By referencing real-time depth from offchain venues, Ostium said its allowable open interest now scales dynamically across most major assets, removing static caps and introducing rollover fees that reflect the underlying asset’s carry cost. Users retain custody of funds, and settlement remains instant onchain.
With the new infrastructure in place, Ostium plans to take on centralized CFD brokers, targeting a market that moves roughly $10 trillion in monthly volume.
Monthly trading volumes on Ostium hit an all-time high of $6.11 billion in March, and the platform has processed more than $50 billion in cumulative volume since launching in 2024, according to DeFiLlama.
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