How Do Options Contracts on a CEX Compare to Perpetual Swaps on a DEX in Terms of Counterparty Risk?

Options on a CEX carry counterparty risk primarily with the exchange itself, which acts as the central clearing party and guarantor. Perpetual swaps on a DEX, however, largely eliminate traditional counterparty risk by using smart contracts and collateral to automate settlement and liquidation.

The risk shifts from a human counterparty to the smart contract's code and the underlying protocol's design.