Lyra Finance goes to new chains

CoindeskFebruary 06, 2023

Lyra, an automated market maker for crypto traders to buy and sell options, is now a multichain protocol after successfully launching its Newport upgrade earlier this week. Lyra follows other option protocols such as Dopex, Premia and Thales that went to multiple chains before Lyra did.

Initially only running on Ethereum layer 2 chain Optimism, Lyra has expanded to Arbitrum, another layer 2 platform, and integrated with decentralized exchange GMX perpetuals, a derivative trading product without an expiration date.

"Paul," a core contributor for Lyra, told CoinDesk, “One of our main drivers of launching on Arbitrum and GMX is that we noticed that there were distinct communities forming on each chain. There are users that only use Arbitrum and users that only use Optimism. We realized it doesn’t really make sense to just wall ourselves off to only one subset of users.”

Next to a broader focus to target new users, Lyra has also updated its protocol. Before the upgrade, market maker vaults paid swapping fees twice to collateralize and hedge the trades users would make on their platform. By integrating GMX, this is no longer the case. The options are partially collateralized with cash while the hedges take place on the GMX platform. A great example of composability.