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LFG Perp Architecture

LFG Perp is built on a modern, scalable architecture that combines the security of blockchain with the performance needed for high-frequency trading.

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System Overview

The @oraichain/lfg-client-js SDK is a TypeScript client library that developers use to interact with the Indexer API and Validator RPC. It’s not part of the core architecture, but rather a convenient tool for building applications.

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Core Components

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1. LFG DEX Side Chain

LFG DEX runs as an independent side chain connected to Oraichain mainnet via IBC (Inter-Blockchain Communication):

Independent Chain

Dedicated Infrastructure
  • Own validator set
  • Optimized for trading
  • High throughput for orders
  • Custom trading modules

IBC Connected

Oraichain Integration
  • Asset transfers via IBC
  • Oracle price feeds from mainnet
  • Shared security guarantees
  • Cross-chain interoperability

Specialized Design

Trading Optimized
  • Fast block times (~1s)
  • Efficient order matching
  • Low latency execution
  • High transaction throughput

Cosmos SDK

Built on Cosmos
  • Tendermint consensus
  • Modular architecture
  • Proven technology
  • Easy upgrades

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2. Oraichain Mainnet

The main Oraichain blockchain that LFG DEX connects to:

IBC Hub

Cross-Chain Bridge
  • IBC protocol support
  • Asset transfers to LFG DEX
  • Multi-chain connectivity
  • Secure bridging

Oracle Services

Price Feeds
  • Decentralized oracles
  • Multiple data sources
  • Price aggregation
  • Real-time updates

Security

Shared Security
  • Validator network
  • Staking mechanism
  • Slashing conditions
  • Network protection

Governance

Chain Governance
  • Proposal system
  • Community voting
  • Parameter updates
  • Upgrade coordination

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3. LFG Trading Modules

The core trading functionality implemented as Cosmos SDK modules on the LFG side chain:
Manages perpetual futures contracts and positions.Responsibilities:
  • Order matching
  • Position management
  • Liquidation logic
  • Funding rate calculations
  • Collateral management
Features:
  • Multiple markets
  • Cross-margin support
  • Risk parameters per market
  • Emergency shutdown capability

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4. Indexer Service

High-performance read-only API for market data (off-chain service):
Components:
  • PostgreSQL database for historical data
  • Redis for caching hot data
  • WebSocket server for real-time streams
  • REST API for queries
Data Flow:
  1. Listens to blockchain events
  2. Processes and indexes data
  3. Stores in optimized format
  4. Serves via API endpoints
Optimizations:
  • Indexed database queries
  • Aggressive caching strategy
  • Denormalized data for reads
  • Connection pooling
  • Load balancing
Metrics:
  • < 10ms query latency
  • 1000+ req/s throughput
  • 99.9% uptime
  • Real-time updates
Market Data:
  • Orderbook snapshots
  • Trade history
  • Price candles
  • Market statistics
  • Funding rates
Account Data:
  • Balances
  • Positions
  • Order history
  • Fill history
  • PnL calculations

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5. Client SDK (@oraichain/lfg-client-js)

A TypeScript library that simplifies interaction with LFG DEX: 
// SDK wraps the API calls
const client = await CompositeClient.connect(network);

// Read from Indexer API
const markets = await client.indexerClient.markets.getPerpetualMarkets();

// Write to Validator RPC
const tx = await client.placeShortTermOrder(/* ... */);
What the SDK Provides:
  • Type-safe API wrappers
  • Connection management
  • Transaction signing helpers
  • Error handling utilities
  • Convenient abstractions
The SDK is not part of the core LFG DEX infrastructure. It’s a developer tool that makes it easier to build applications that interact with the chain.

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Data Flow

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Order Placement Flow

“App” can be a web interface, trading bot, or any application using the SDK or direct API calls.

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Market Data Flow

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Security Architecture

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Multi-Layer Security

Wallet Security

User Responsibility:
  • Private key management
  • Transaction signing
  • API key security
  • Device security

Protocol Security

On-Chain Protection:
  • Margin requirements
  • Liquidation engine
  • Position limits
  • Circuit breakers

Oracle Security

Price Feed Protection:
  • Multiple data sources
  • Outlier detection
  • Staleness checks
  • Emergency pause

Infrastructure Security

Operational Security:
  • DDoS protection
  • Rate limiting
  • API authentication
  • Encrypted connections

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Liquidation System

The liquidation system ensures exchange solvency:
Continuous Checks:
  • Every block processes margin checks
  • Calculates maintenance margin
  • Identifies undercollateralized positions
  • Flags accounts for liquidation

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Scalability

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Current Capacity

Throughput

1000+ TPSTransactions per second supported by Oraichain

Latency

< 1s FinalitySub-second block time for fast confirmations

Orders

100k+ OrdersConcurrent open orders supported

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Future Scaling

Potential rollup integration for even higher throughput while maintaining security.
Market-specific sharding to distribute load across validator set.
Parallel transaction processing for increased throughput.

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Technology Stack

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LFG DEX Side Chain

ComponentTechnologyPurpose
ConsensusTendermint BFTByzantine fault tolerance
FrameworkCosmos SDKModular blockchain development
LanguageGoChain implementation
IBCIBC ProtocolCross-chain communication

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Oraichain Mainnet

ComponentTechnologyPurpose
ConsensusTendermint BFTNetwork consensus
FrameworkCosmos SDKBlockchain framework
IBCIBC ProtocolInter-chain bridging
OraclesCustom ModulesPrice feed infrastructure

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Indexer

ComponentTechnologyPurpose
DatabasePostgreSQLHistorical data storage
CacheRedisHot data caching
APINode.js/TypeScriptREST and WebSocket server
QueueBullBackground job processing

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SDK

ComponentTechnologyPurpose
LanguageTypeScriptType-safe development
HTTPAxiosAPI requests
WebSocketwsReal-time streams
Crypto@cosmjsTransaction signing

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Network Topology

Validator Network:
  • Geographic distribution
  • Redundant infrastructure
  • Load balancing
  • Failover capability
Responsibilities:
  • Block production
  • Transaction validation
  • State consensus
  • Network security

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Monitoring & Observability

Blockchain Metrics

  • Block time
  • Transaction throughput
  • Validator health
  • Network latency

Application Metrics

  • API response times
  • Order placement rate
  • Liquidation events
  • Funding rate history

System Health

  • CPU and memory usage
  • Database performance
  • Cache hit rates
  • Connection pools

User Activity

  • Active traders
  • Order volume
  • Position sizes
  • Unique addresses

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Next Steps

Start Building

Begin developing on LFG Perp

SDK Reference

Explore the SDK documentation

Trading Guides

Learn how to trade

Security

Security best practices