Hegic vs. Lyra Finance

Hegic excels at providing deep, single-sided liquidity for retail traders through its peer-to-pool architecture. Liquidity providers (LPs) deposit assets into a shared pool, which acts as the direct counterparty to all options buyers and sellers. This model, operating on Arbitrum and Ethereum, simplifies the user experience by eliminating the need for order books or counterparty matching. For example, Hegic's v2 protocol on Arbitrum One has facilitated over $1.5B in cumulative volume, demonstrating its capacity for high-throughput retail activity with low gas fees.

Lyra Finance takes a different approach by building a dedicated Automated Market Maker (AMM) on Optimism and Arbitrum. This AMM uses a Black-Scholes-based pricing model and dynamically hedges its risk via integrations with Synthetix and GMX perpetuals. This results in a trade-off: while offering more capital-efficient, market-maker-like pricing for sophisticated traders, it introduces protocol-managed complexity and reliance on external liquidity for delta hedging. Lyra's AMM vaults have consistently held significant TVL, often exceeding $30M, indicating strong institutional and advanced trader confidence in its risk-managed system.

The key trade-off: If your priority is simplicity and accessibility for a broad user base seeking to buy or sell options with minimal slippage, choose Hegic. If you prioritize capital efficiency, advanced pricing, and a system designed for active traders and LPs seeking yield from dynamic market-making, choose Lyra.

Hegic excels at providing deep, sustainable liquidity for long-tail assets through its peer-to-pool, on-chain vault model. Because liquidity providers deposit assets directly into non-custodial smart contracts, Hegic can offer options on a wide range of assets like WBTC, ETH, and SOL without reliance on external liquidity venues. This results in robust, predictable liquidity, as evidenced by its consistent Total Value Locked (TVL) of $30M+ and its ability to list new assets without a centralized launch process. The trade-off is slower settlement and higher gas costs due to its fully on-chain, Ethereum mainnet-native architecture.

Lyra Finance takes a different approach by leveraging a hybrid model built on Optimism and Arbitrum. It combines off-chain risk management and market-making with on-chain settlement via Synthetix's peer-to-pool liquidity. This architecture enables superior capital efficiency, lower fees, and faster trade execution. For example, Lyra's integration with Synthetix's perpetual sUSD pool allows liquidity to be shared across the protocol, contributing to its higher historical trading volumes. The trade-off is a narrower asset focus (primarily ETH and BTC options) and a dependency on the specific Layer 2 ecosystem and its associated bridge security assumptions.

The key trade-off: If your priority is deploying options on diverse, long-tail assets with maximally decentralized, on-chain settlement, Hegic's self-contained vaults are the superior choice. If you prioritize capital efficiency, low transaction fees, and high-frequency trading for major blue-chip assets, Lyra's optimized Layer 2 architecture is the clear winner. For CTOs, the decision maps directly to user experience: Hegic for decentralized maximalists, Lyra for traders seeking performance.