How Stork helped Vertex overcome latency and market expansion limitations in DeFi trading

New markets added
Total trading volume

About the Company

Vertex is a pioneering decentralized exchange (DEX) protocol, offering a seamless blend of spot, perpetuals, and integrated money markets on the Arbitrum L2 Ethereum network. Built by a team of traders and engineers with an impressive track record of building in both TradFi and DeFi markets, their vision is to deliver a centralized exchange (CEX)-like experience within the DeFi landscape – offering the vibrant trading experience of CEXs while preserving self-custody and on-chain settlement characteristic of DeFi. Vertex leverages a unique hybrid of a central limit order book and automated market makers, ensuring low latency and optimal liquidity.

“Leveraging Stork's expertise and performant oracle architecture has allowed Vertex to maintain a competitive edge in trading performance across an increasingly competitive DEX landscape in DeFi,”

Darius Tabatabai
Vertex’s Co-Founder

Products Used

Perpetual Future Mark Price Index

Index Price

The problem

Limitations of data latency and restricted market support from traditional oracle providers

Vertex operates using a unique blend of a central limit order book (CLOB) and an automated market maker (AMM) system, enhancing available liquidity as pairwise LPs from the AMM populate the orderbook. Its design minimizes gas fees and Miner Extractable Value (MEV), using the utilizing the sequencer’s off-chain order matching latency of 10 - 15 milliseconds to match inbound orders and submit them in batches of transactions to settle on-chain to Arbitrum. 

In order to deliver order execution at a speed comparable to centralized exchanges, Vertex's orderbook functions off-chain. The platform's AMM liquidity is merged with that from automated traders, creating a unified liquidity pool. Its cross-marginalized trading experience allows users to manage positions from a single portfolio, where account health is derived from the liabilities of positions held across Vertex’s spot, perpetual and integrated money markets.

Given the time-sensitive nature of the trading experience Vertex offers, reliable and timely data are critical. The latency and delays in data updates common amongst most oracles and data solutions would hinder Vertex’s ability to deliver a competitive trading experience. In addition to solving data latency and reliability issues, Vertex also needed the ability to quickly and efficiently integrate new markets. The combined needs for rapid integration of new markets and high-quality price data made it clear to Vertex that identifying or developing an appropriate data provisioning service would be essential in maintaining its agility and growth potential.

Before partnering with Stork, Vertex explored various oracle solutions and even considered in-house development to bridge the existing market gap. Traditional oracle services were insufficient due to the significant delays in pricing updates and restricted market support they offered. The cost and engineering time required to develop in-house, paired with market demand for trusted data sources, led Vertex to seek out an oracle service provider that provided ultra low-latency price data and eliminated any friction from integrating new markets.

The solution

Stork delivers ultra low-latency data and diverse market support 

Partnering with Stork enabled Vertex to comprehensively address its latency and market support challenges. Stork's competitive advantages in ultra-low-latency price data, robust support for USDC markets, and proactive response in supporting new markets collectively fulfilled each of Vertex’s requirements. This support was instrumental in solidifying Vertex's essential trading functions, particularly in funding fee calculations and liquidations.

Stork's flexibility in accommodating new markets and robust, reliable data feeds proved to be pivotal in enabling Vertex to rapidly expand its market offerings without burdensome delays or sacrificing data reliability. The responsiveness and dedicated support of Stork’s team during the onboarding process yielded a seamless and efficient integration into Vertex’s infrastructure. 

With its critical technical challenges addressed, Vertex has been able to double down on its focused commitment to delivering an unmatched trading experience for its users.

The results

Reliable data and support for new markets drives trading volume growth for Vertex

Fueled by the reliability and speed of Stork’s oracle service, Vertex observed immediate improvements in funding fee calculation and liquidations, elevating trading performance to rival centralized exchanges. Vertex not only improved its operational efficiency but also enhanced its core user experience, in turn setting a new standard for trading experiences in the DeFi ecosystem. 

Since its partnership with Stork, Vertex has introduced 37 new markets and shown consistent month-over-month growth. With a cumulative trading volume of $49B, Vertex ranks second in average daily trading volume (ADV) on the Token Terminal Derivatives dashboard over the past 90 days. Vertex also ranks fourth in gas-consuming apps on Arbitrum according to the Nansen Smart Contract gas tracker dashboard. Looking ahead, Vertex is focused on rolling out new features like one-click trades, automatic yield earning on account collateral, and increasing capital efficiency with universal cross-margin accounts.