PerpsPad: How It Works, How To Use It, and Why It's Innovative

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Gone are the days when you needed a dev to hard-code a contract just to get a token live. 

Token launchers have come a long way since then. Today, you can launch tokens in just a few clicks using different models, and we’re even seeing more exotic pairings, from onchain stocks to tokens beyond the regular native network or stablecoin pairing.

So, the next natural step is to add more depth to these quick and exotic token launches, exploring what can be built around them and how these different designs can work together.

Today’s discourse, with over $70 million in trading volume ($60 million in spot trading/swaps, $10 million in perps trading) and over 200 coins launched, can be said to embody exactly what this natural evolution is supposed to look like. 

Without wasting any of your time, let’s look into PerpsPad together: what it is, how it is designed, the second-order effect of its design, and how you can use it. 

What is PerpsPad?

PerpsPad is a Solana-based protocol that serves as a token launchpad, deepening token trading to create financial primitives on top of a simplified trading experience. 

As the name suggests, PerpsPad offers a layered token-launch model, in which each pair launched on the platform is backed by a leveraged perpetual contract. 

How does PerpsPad work? 

The protocol, from the ground up, is built around the idea that trading fees can be flexible. 

PerpsPad configures a token's trading fees into customizable capital, using composable DeFi infrastructure to connect token launches, perpetual positions, and automated treasury management.

In ape speak, this simply means that the fees your token generates are automatically put to work, funding a live perp position. 

In terms of composability, the token launch and liquidity infrastructure is derived from Meteora, and as tokens are launched and traded, the fee is split to accommodate leveraged perps, with Phoenix providing that infrastructure, routing from Imperial Perps. 

Based on this, any token launched via PerpsPad is a standard SPL token with a fixed supply of 1 billion. 

Upon launch, price discovery is executed through Meteora’s dynamic bonding curve. 

PerpsPad ensures sufficient guardrails are in place to prevent tokens from being rug-pulled by creators, mostly inherited through integration. 

For example, mint and freeze authorities are revoked, and liquidity is locked forever once migration occurs. 

Like most launchpads nowadays, creators are given the flexibility to pair tokens with exotic quote tokens ranging from normal memecoins to stablecoins to stock tokens. 

Creators are thus able to create a new token with over 44 choice quote tokens available through Meteora, ranging from crypto tokens like ARB, HYPE, INJ, wBTC, to DeFi tokens like LIT; meme tokens like CASHCAT, PONS; over 27 stocks, including HOOD, INTC, SNDK; plus pre-IPOs such as OPENAI, KALSHI, etc. 

After creators select the token pairing, they can choose a financial strategy (e.g., leveraged perp) that underlies the token. 

Users can select between a single position structure or a two-position basket - that is, either a single perp position backing the token or splitting it across two perp positions. 

Over 60 markets are available for selection, with tickers like BTC, SOL, HYPE, ETH, and more exotic options like GOOGL, TSLA, and NVDA. 

The creator can leverage any of these underlying markets, long or short, as a strategy to back the token.  

The maximum leverage allowed is inherently that which is tenable, provided by Phoenix. It is flexible via a slider that lets the creator draw back and forth to their desired level of leverage. 

Once a token is created and it graduates, whatever fee (it varies in the $20-25 range depending on the price of SOL and the quote assets) generated from buying and selling activity on the token is routed to the coin’s sub-wallet, which funds the position(s) variables pre-selected at creation. 

This makes two public addresses visible to the user: the token's contract address and its sub-wallet, which receives fees and serves as the treasury for the perp position. 

Each token’s sub-wallet is designed to be siloed from any other token launched on the platform, mitigating contagion risks.

From the UI, users can view the activity on a position, whether it is in profit or loss, as seen above. 

Fee-sharing formula

Now, you might ask: how is the fee split? 

PerpsPad is designed so that fees cover all entities, including the protocol’s moat. As fees are claimed into the token’s sub-wallet, there’s a fixed 30% split between the creator and the treasury, each getting 15% of the split. 

Ayy, we still have 70% left - the launcher distributes this; 30% to the perp collateral, 10% to either buyback and burn or buyback and LP, and the remaining 30% is paid out as a dividend to the holders of the token. 

The 70% sharing formula is flexible, allowing creators to choose which formula best serves the token's purpose. 

Users may voluntarily provide collateral for a token’s perp position. Of course, this is a non-refundable transaction intended to allow anyone to positively influence the underlying backing. 

If a position is in profit, the keeper, which is a bot if you’re wondering, is able to take profit by tracking the unrealized PnL to ascertain if it’s grown past the last lock-in. 

If all conditions are met, the keeper closes a portion of the position, and newer fees rebuild the position. 

The portion closing is intended to enable growth in a position’s size as demand increases, generating fees, while the trade remains unliquidated and in profit. 

If the token has dividend sharing on, the profit is split between holders, buybacks, the creator, and the master treasury, but a coin without dividend sharing on distributes differently, with 75% of the profit going to the buyback reserve. 

Should a liquidation event occur, the collateral is lost. However, the perp structure remains active, and as more trading fees are generated, the keeper will open a new position once it is established that price action is back above the liquidation price, and a cooldown period has been passed. 

PerpsPad sets the liquidation cooldown buffer to 6 hours for the first liquidation event, 12 hours for the second, and 24 hours for the third. 

What makes PerpsPad innovative?

We’re in a period of wild experimentation with what’s possible onchain, as new long-tail primitives continue to emerge. 

We’ve acquainted you with how PerpsPad taps into this experimentation – the next thing is what exactly sets it apart and why it should be considered interesting.

• Third-party perp volume engine 

Being able to launch tokens with underlying perpetual backing is cool. But what’s even more interesting is how PerpsPad turns those launches into a potential engine for continuous perp volume.

PerpsPad generates fees and trading activity for the underlying perpetual exchange through a recurring lifecycle built into its architecture.

As long as a coin continues to attract trading activity, buyers and sellers generate fees that can help maintain an open, actively managed perpetual position on the exchange. 

The result is a feedback loop where token activity can translate into sustained demand for perp infrastructure.

Historically, memecoins and perpetual exchanges have often competed for traders' attention and volume. We've seen comparisons between launchpads, consumer trading apps like fomo, and perp platforms such as Hyperliquid and Phoenix.

But PerpsPad introduces a more nuanced dynamic. Rather than simply competing with perp platforms for volume, it connects token launches directly to perpetual trading infrastructure, creating a mechanism through which token activity can generate ongoing trading demand for the underlying exchange. 

• Exotic financial strategies 

PerpsPad opens up the possibility of combining token launches with more sophisticated trading strategies, including directional bets, hedges, relative-value trades, and narrative trades.

A token could launch with one asset as its quote token while using a different asset for its perpetual backing, such as a SOL-quoted token with a BTC long or short position.

Creators could also explore relative-value strategies, such as going long SOL and short BTC, or use perpetuals to express a specific market thesis with the two-position basket.

These aren't automatically hedges, but they introduce more flexibility than simple directional exposure. 

How to use PerpsPad? 

To create your own perps-backed token on PerpsPad, start by: 

• Connecting your wallet via the app
• Click on the menu button on the top left-hand side of the screen

• Select create, and you’ll be taken to the creator terminal
• There are four stages of creation: 
  

a) Identity – fill in details about your token – e.g., blocperp; BLOC 

b) Pairing - select the quote token - either SOL, USDC, or any other token of choice as provided on Meteora 

c) Strategy - select the strategy structure: single position or two-position basket

d) Backing perp selection - there are over 60 markets available for backing 

• Choose a position between long/short 
• Select the leverage using the slider (higher leverage = more risks) 

• Review - ensure you review everything, including selecting your preferred fee-sharing formula and whether to pay a dividend 
• Proceed to launch the token
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Buying a token is pretty straightforward. 

• Connect your wallet
• Search for the token on the search bar at the top center of the screen, or select from the listed options on the homepage
• Click on any token of choice and proceed to swap 

What’s coming?

PersPad, as a product, belongs to Kolkheti Labs, a team experimenting onchain, right out of a mancave in Georgia (not the US, the country, Tbilisi, Georgia). 

Word on the street is they’ve got something, a product that is tied to PerpsPad dropping soon. This product will allow anyone with domain expertise to publish a basket of assets, turning them into a single traded token that ideally resembles a meme-index. 

The content of a basket can be an exotic mixture of all the assets they already offer on the PerpsPad platform through Meteora, such as regular onchain tokens, tokenized stocks, commodities, RWAs, etc. 

You can picture building a situational-awareness basket whose underlying asset is a thoughtfully curated, thesis-driven index of tokenized stocks and prestocks that reflect the creator’s purview of the AI trade. 

The idea is built around creating an avenue for users to express their thesis about a domain through a trade that is exciting enough for onchain users to benefit from the upside via memecoins, as well as the attention and price action that the underlying tokens generate.

Each basket will be a fungible SPL token, backed by the underlying assets, priced against the combined value of those assets, and available as a quote token on PerpsPad, allowing anyone to launch a token using the meme-index as a pair. 

The economics built around the baskets is quite something interesting. For example: 

If a creator should publish a “Bullish onchain-finance” basket with the underlying backing as 30% HYPE, 30% DRV, 20% LIT, and 20% MET, and locks it with a $1000 seed, after which the system proceeds to launch and mint the token. 

The fee split is modeled to ensure that the creator earns multiples on that $1k seed from others launching tokens paired with their basket. 

As at the time of writing, the touted fee-sharing formula is: 0.40% pool fee, 0.15% mint/redemption fee, 0.10% royalty on PerpsPad. 

With such royalty, should a token paired with the “Bullish onchain-finance” basket reach $10 million dollars in lifetime trading volume, at 0.10% royalty, the creator would have earned ~$9,000 (9x returns) in net royalty from PerpsPad, on just a single token launched using the “Bullish onchain-finance” basket as a quote. 

Every meme paired against the basket will further earn the creator more royalties, using the same math.

As such, the opportunity to be the first to create a really cool basket is mouth-watering, but considering this is all still in the works, we’re giving you folks, who made it to the end of the article, a chance to be among a select few to create a basket that will be available as a quote token on the PerpsPad platform. 

The perk of doing this is that you’ll get to keep a share of the fees from every trade your basket is paired with as a quote token. Plus, you get to express whatever trade idea you have been wishing to see onchain before anyone else beats you to it. 

Disclaimer: Kolkheti Labs is as experimental as it gets, so we advise you to do your own research before giving it all a whirl. 

Final thoughts 

We will close this out with a simple excerpt from Bonk Guy’s thesis on fomo - 

“There’s been lots of launchpads competing with themselves on the same meta - i.e., pure memes paired with native blockchain tokens or stablecoins (e.g., Pumpfun/Pons), stock pairs (e.g., STONK/Long), a combo of both (e.g., Pons), etc.

$PerpsPad is a first mover and clear leader in an entire new meta: perps-backed memecoin launches.” 

We believe there's room for growth in this product and in what it could become, though it still has an air of experimentation. 

We will be on the lookout for key indicators, such as how much volume PerpsPad positions contribute to the overall trading volume on Phoenix, whether there will be expansion into other trading venues, and when a position grows large enough for its PnL to become too significant to ignore. 

Imagine a PerpsPad token launched at an impeccable timing of the cycle’s pico top, paired to BTC as a quote token, and backed with a BTC short with enough fees to get Saylor’s attention. 

Matter of time, I guess. 

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Thanks to the PerpsPad team for unlocking this article. All of our research and references are based on public information available in documents, etc., and are presented by blocmates for constructive discussion and analysis. To read more about our editorial policy and disclosures at blocmates, head here.