Variational predicts RWA perpetuals will soon be the biggest contract class in DeFi

Variational, a peer-to-peer onchain derivatives trading protocol, said it raised $50 million in a round led by global investment fund Dragonfy with participation from companies including Bain Capital Crypto and Coinbase Ventures.

The money will be used to expand the Cayman Islands-based company’s derivatives trading services, it said in a statement released Thursday. The raise comes just as Variational introduces perpetual futures tied to real-world assets (RWAs) such as gold, silver, copper and West Texas Intermediate (WTI) crude oil.

“We believe RWA perpetuals will soon be the biggest contract class in decentralized finance (DeFi), bigger than bitcoin and ether combined,” Lucas V. Schuermann, CEO and co-founder at Variational, told CoinDesk.

Bitcoin BTC$77,637.45, the largest cryptocurrency, has a market capitalization of $1.6 trillion. Ether (ETH), the second-biggest, has $256 billion. Combined, they account for almost 68% of the total cryptocurrency market cap.

Variational said it has carried more than $200 billion in trading volume since its inception in 2025, and the new funds will enable it to build the infrastructure needed to route liquidity directly from traditional markets within the coming months. Its model is uniquely designed to aggregate and route liquidity from traditional and onchain markets, avoiding the need to build it from scratch on isolated marginal order books, the company said.

“Our Series A secures the capital and partners we need to bring [traditional finance] TradFi-grade depth to 100 plus onchain perps by aggregating liquidity from the source, rather than rebuilding thin order books for each new listing,” Schuermann said.

Dragonfly’s investment comes two months after it announced a $650 million raise, at the time was one of the largest in the sector, when many blockchain-focused VCs were struggling, Managing Partner Haseeb Qureshi said.

In a message to CoinDesk, Qureshi detailed the market structure problem that prompted his firm’s investment.

“Most DeFi exchanges are trying to bootstrap liquidity for every asset from scratch, and it shows,” Qureshi said. “Outside the top ten traded assets, markets are dangerously thin.”

Qureshi said that TradFi solved this cold-start liquidity issue decades ago by using a request-for-quote (RFQ) system, in which dealers quote on demand and hedge against deep underlying markets like the CME or NYSE in real time.

“That’s exactly what Variational does, but onchain,” Qureshi said, noting the architecture features margin in smart contracts, settlement in stablecoins, and permissionless access to institutional depth.

“RWA perps will be the biggest contract class in crypto within a year, larger than BTC and ETH perps combined. The platform that wins won’t look like a traditional exchange. We are proud to back Variational,” he said.

UPDATE (May 21, 19:00 UTC): Adds comments from Dragonfly’s Haseeb Qureshi.