## Sovryn Launches Perpetual Swaps on Testnet, Bringing Leveraged Trading to Bitcoin DeFi
Community Call #33 marked a significant expansion of Sovryn’s financial toolkit with the announcement of **perpetual swaps** launching on the public testnet. This new feature allows users to trade leveraged futures contracts directly on Sovryn, using only their Bitcoin as collateral. The launch is accompanied by a trading competition designed to battle-test the system before its mainnet release.
### What are Perpetual Swaps?
Perpetual swaps are a type of futures contract that allows traders to speculate on the future price of an asset without an expiration date. On Sovryn, users can now trade a BTC/USD perpetual contract with up to **10x leverage**. Crucially, the entire system is Bitcoin-native: traders post BTC as margin, and all profits and losses are settled in BTC. This means users can gain leveraged exposure to price movements without ever leaving the Bitcoin ecosystem or touching fiat currency.
### How Does it Work?
The system uses an on-chain Automated Market Maker (AMM) and a dynamic funding rate mechanism to keep the perpetual contract’s price closely pegged to the spot price of Bitcoin. Traders can go long (betting the price will go up) or short (betting the price will go down), providing a powerful tool for both speculation and hedging.
### Testnet Trading Competition
To encourage community participation and identify any potential issues, Sovryn is hosting a **trading competition** on the testnet. Users can claim testnet BTC and compete to achieve the highest profit and loss (PnL) over the competition period. Prizes will be awarded to the top traders, and the data and feedback gathered will be invaluable for ensuring a smooth and secure mainnet launch.
### Why is this Important?
The introduction of perpetual swaps positions Sovryn as one of the very few platforms offering decentralized, Bitcoin-native leveraged trading. It adds a crucial DeFi primitive that attracts a new class of traders to the ecosystem and provides existing users with sophisticated tools to manage their positions. This is a major step towards building a comprehensive, one-stop financial system on Bitcoin.