Hyperliquid, the new age decentralized exchange (DEX), is setting new benchmarks in the world of crypto trading with its innovative approach that combines the best of centralized and decentralized platforms. This DEX is the current ‘hype’ in the dex landscape. Let’s dive into the details that make this platform unique.
Hyperliquid is a decentralized exchange specializing in perpetual futures (up to 50x leverage) trading. It operates on a custom-built, high-performance Layer 1 blockchain known as HyperEVM or Hyperliquid L1.
As a self-funded platform that has shunned venture capital funding, it focuses on its community by redistributing all revenue back to its users and conducting large-scale airdrops.
Since its launch in 2023, Hyperliquid has quickly risen, boasting daily trading volumes that exceed $1.6 billion and a user base of over 190,000 traders by late 2024. By early 2025, it accounted for more than 70% of the monthly perpetual trading volume in the crypto market, becoming the largest perpetual DEX.
Hyperliquid was founded in 2022 by Jeff Yan and Iliensinc, both of whom are Harvard University alumni and have experience in high-frequency trading.
The inspiration for Hyperliquid began taking shape as early as 2020 when Jeff Yan was engaged in developing trading scripts for centralized exchanges.
With the downfall of FTX and the necessity for a more decentralized approach, the founder of Hyperliquid saw an opportunity to use his skills to contribute to this market demand with his new platform.
This review of Hyperliquid (HYPE) was created for informational purposes. This article is not intended for promotion.
As we know, Hyperliquid is a next-generation decentralized exchange that specializes in perpetual futures trading. It has some unique features that we will discuss shortly.
Built using the Rust programming language, Hyperliquid’s blockchain can handle up to 200,000 orders per second. This high throughput is essential for accommodating the rapid transaction volumes common in high-frequency trading.
Hyperliquid’s HyperBFT consensus algorithm delivers high throughput and low latency by combining Byzantine Fault Tolerance with network and execution optimizations. This allows trade settlements to occur under a second-comparable to centralized exchanges-while maintaining decentralization and security.
Another feature of Hyperliquid is that it has its order book fully on-chain. This means that all orders, cancellations, and trades are documented on-chain, directly on the blockchain. This feature sets it apart from other platforms that might use off-chain order books, for better and for worse.
To provide accurate and up-to-date pricing, Hyperliquid’s validators publish spot prices derived from a weighted median of data from leading exchanges, including Binance, OKX, Kraken, Bybit, and KuCoin.
Hyperliquid also incorporates an Ethereum Virtual Machine (EVM) bridge that facilitates easy and smooth asset transfers between Ethereum-based networks and Hyperliquid.
More info can be found here. https://hyperdash.info/bridge
Very important to people who want their ‘privacy’ is the fact that, like a lot of decentralized exchanges, Hyperliquid does not require users to undergo KYC (Know Your Customer) procedures. This preserves the anonymity/pseudonymity of its users.
Unlike most DEXs, where traders are required to pay variable gas fees, Hyperliquid eliminates these gas fees entirely. Whether placing a trade, modifying an order, or canceling it.
When traders make a trade they are only subject to low trading fees, with maker fees at 0.01% and taker fees at 0.035%. This is extremely low.
Lastly, we have the Hyperliquid Vaults that allow users to participate in market-making activities. This way, users can deposit assets into these vaults to facilitate trade pairs and act as liquidity providers.
Vault owners receive a 10% cut of the total profits generated, except for protocol vaults, which are operated without any fees or profit-sharing mechanisms.
An example of a protocol vault is the Hyperliquidity Provider (HLP), which engages in market-making and liquidation processes, earning a portion of trading fees.
Users can start a vault by choosing a name, writing a description, and depositing a minimum of 100 USDC, but vault leaders are required to maintain at least a 5% ownership stake in their vault.
HYPE is the native token of the Hyperliquid ecosystem, designed to let the whole network function. It is used for:
In November 2024, the platform launched its native token, HYPE, through a large-scale airdrop to nearly 100,000 early adopters. Nearly all of these early adopters received HYPE in one of the largest DeFi airdrops per wallet, of roughly around $45,000–$50,000 per user.
The total supply of Hype tokens is capped at 1 billion and utilizes a distribution strategy where the Hyperliquid ecosystem burns a part of its tokens in recurring ‘token burns’.
Approximately 26% of the total supply is burned annually. When we look at the initial token distribution, we see the following numbers…
| Category | Percentage of Total Supply |
| Future Emissions & Community Rewards | 38.888% |
| Genesis Distribution (Airdrop) | 31.0% |
| Core Contributors | 23.8% |
| Hyper Foundation Budget | 6.0% |
| Community Grants | 0.3% |
| HIP-2 Allocation | 0.012% |
Tokens allocated to the team and contributors are subject to a minimum one-year vesting period, starting from the token generation event on November 29, 2024.
Later in time, there are gradual emissions that are distributed progressively as illustrated below…
Staking HYPE tokens on Hyperliquid allows you to earn rewards while supporting the network’s security and decentralization. Follow this step-by-step guide to stake your tokens effectively:
With the focus of traders drifting away from centralized exchanges to decentralized exchanges, the fact that you can trade perpetuals and with leverage totally on-chain and with enough liquidity is very innovative in the DeFi space.
Also with a positive sentiment towards HYPE, the token’s emphasis on community ownership—with over 70% of tokens distributed to users—it could be interesting to keep an eye on the hyperEVM and its emerging dApps. So not only the token price, but its whole emerging ecosystem could be interesting to follow.
Hyperliquid aims to bridge the gap between centralized and decentralized exchanges as it seeks to offer the speed and user experience typical of CEXs while upholding the transparency and self-custody principles of DeFi in trading perps and spot crypto markets.
Disclaimer: Trading and investing in cryptocurrencies (also called digital or virtual currencies, altcoins) involves a substantial risk of loss and is not suitable for every investor. You are solely responsible for the risk and financial resources you use to trade crypto. The content on this website is primarily for informational purposes and does not constitute financial advice.
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