Hyperliquid

Hyperliquid is a layer 1 blockchain built to run a fully onchain order book exchange for perpetual futures and spot trading. It has two execution environments secured by one consensus: HyperCore, which runs the order books, margining, and liquidations, and HyperEVM, an EVM environment that is part of the same chain rather than a separate one.¹² Its native token is HYPE. Hyperliquid was built by Hyperliquid Labs, which states it took no outside venture funding.³

HistoryReport an error

Founding

Hyperliquid was founded by Jeff Yan and a pseudonymous co-founder known as iliensinc. Yan studied mathematics and computer science at Harvard University and briefly worked as an algorithm developer at Hudson River Trading, a high-frequency trading firm, before moving into crypto.⁴⁵ From 2020 the team did proprietary market making in crypto, through a firm called Chameleon Trading.³⁶ Hyperliquid Labs has stayed small, with about a dozen people, and has not raised money from outside investors.⁴

The team set out to build an exchange with the speed and features of a centralized exchange but with every order and trade recorded onchain. Yan has said the collapse of the centralized exchange FTX in November 2022 convinced him it was the right time to build a decentralized exchange.⁴ Hyperliquid opened as a closed alpha in February 2023 and launched fully later that year.⁷ The first versions ran on the Tendermint consensus engine; in 2024 the team replaced it with its own, HyperBFT.⁸

Growth

Hyperliquid's trading volume grew through 2023 and 2024. In 2025 it was the largest decentralized exchange for perpetual futures by open interest, and for most of the year by volume, ahead of earlier venues such as dYdX and GMX, a perpetual futures exchange that started on Arbitrum. In late 2025 newer exchanges, including Aster and Lighter, briefly matched or passed its daily volume, partly through incentive programmes.⁹ Large, active traders account for much of Hyperliquid's activity, and some of their leveraged positions, being public onchain, are followed closely on social media.

Points and token genesis

A points program for traders began on 1 November 2023. Points were distributed weekly in two phases: 1 million a week until May 2024, and 700,000 a week from late May to November 2024.¹⁰ On 29 November 2024 the Hyper Foundation's token genesis event distributed 31% of HYPE's supply to points holders, with no allocation to private investors.¹¹¹² The airdrop went to about 94,000 addresses and was one of the largest by value in crypto at the time.¹³ Core contributors' tokens were locked for one year and began unlocking in late November 2025.¹⁴

Native staking of HYPE opened on 30 December 2024.¹⁵ The absence of venture investors and the size of the airdrop were widely discussed as a contrast to token launches funded by venture capital.

HyperEVM, stablecoins, and builder markets

HyperEVM launched on mainnet on 18 February 2025.¹⁶ It let developers deploy Ethereum-style smart contracts on the same chain as the exchange. On 30 April 2025 contracts gained the ability to read HyperCore state, such as prices and positions, and on 5 July 2025 to send actions to HyperCore, such as placing orders.¹⁷ Lending markets, liquid staking tokens for HYPE, and other applications were built on it.

On 14 February 2025 Unit, a tokenization protocol built on Hyperliquid, began offering spot trading of native BTC, deposited from the Bitcoin network, and later added other assets such as ETH and SOL.¹⁸

On 14 September 2025 validators, with about 70% of stake, voted to award the USDH stablecoin ticker to Native Markets.¹⁹ Two days later Circle launched native USDC on Hyperliquid, which replaced the original bridge from Arbitrum as the main way USDC enters the chain.²⁰²¹ On 14 May 2026 Coinbase became the official deployer of USDC treasury on Hyperliquid, and USDH began to be phased out.²²

On 13 October 2025 HIP-3 went live, letting anyone who stakes 500,000 HYPE deploy their own perpetual futures markets.²³ Builders used it to list markets that other exchanges did not, including perpetuals on equities and other traditional assets.²⁴ On 2 May 2026 HIP-4 added outcome markets, a form of prediction market.²⁵

Supply burn

The Assistance Fund converts trading fees into HYPE. In December 2025 validators voted to recognize the HYPE held by the fund as burned, removing it from total and circulating supply.²⁶²⁷

Exchange-traded products

In May 2026 the first US spot HYPE exchange-traded products began trading, including 21Shares' THYP and Bitwise's BHYP.²⁸

TechnologyReport an error

Consensus

HyperBFT is a Byzantine fault tolerant consensus protocol derived from HotStuff. Validators stake HYPE, and their voting power is proportional to the HYPE staked with them, including HYPE delegated by other holders. Validators that respond too slowly can be jailed by a vote of other validators, which removes them from consensus and stops rewards to their delegators. Blocks are final as soon as they are produced, with no probabilistic waiting period.¹²⁹

HyperCore

HyperCore keeps the full order book onchain: every order, cancellation, trade, and liquidation is a transaction, ordered by consensus. Trades are final in the block in which they are matched. Traders can use cross margin, which shares collateral across positions, or isolated margin, which limits losses to the collateral assigned to one position.³⁰

Perpetual futures have no expiry. To keep their price close to the underlying asset, traders on one side pay the other a funding rate every hour.³¹ Validators publish oracle prices about every three seconds, calculated as a weighted median of prices on centralized exchanges. Oracle prices are used to calculate funding, and are one input to the mark price, which also draws on Hyperliquid's own order book and decides when positions are liquidated.³²

When a position falls below its maintenance margin it is liquidated, first by closing it with market orders on the order book and, if equity keeps falling, by transferring it to HLP. If an account's value turns negative, auto-deleveraging closes profitable positions on the other side.³³³⁴

Hyperliquid Improvement Proposals (HIPs) define its main features:³⁵

• HIP-1: a native token standard for spot assets on HyperCore.
• HIP-2: "Hyperliquidity", automated market making for HIP-1 tokens.
• HIP-3: permissionless perpetual futures markets deployed by builders who stake HYPE.
• HIP-4: outcome markets.

Vaults

The Hyperliquidity Provider (HLP) vault is a community-owned vault that makes markets and takes over liquidated positions. Depositors share its profit and loss. Deposits are locked for four days.³⁶

Anyone can also create a vault and trade with other people's deposits. The vault leader must keep at least 5% of the vault's capital and receives 10% of its profits.³⁷

Fees and the Assistance Fund

Trading fees are tiered by 14-day volume and lower for traders who stake HYPE. Front-ends built on Hyperliquid can add their own fee through "builder codes".³⁸ The Assistance Fund converts trading fees to HYPE automatically as part of chain execution. HYPE in the fund is treated as burned.²⁶

HyperEVM

HyperEVM produces two kinds of blocks: small blocks about every second, with a 2 million gas limit, for ordinary transactions, and large blocks about every minute, with a 30 million gas limit, for contract deployments and other heavy transactions. Its gas token is HYPE. Contracts can read HyperCore state through precompiles and send actions to HyperCore through a system contract called CoreWriter.¹⁷

USDC

USDC is issued natively on Hyperliquid through Circle's Cross-Chain Transfer Protocol. A legacy bridge on Arbitrum, whose withdrawals are signed by Hyperliquid's validators, holds a small and shrinking share of USDC on HyperCore.²¹

GovernanceReport an error

HYPE holders do not vote on proposals directly, but can influence votes by choosing which validator to delegate to. Decisions such as delisting markets, awarding tickers, and changing the supply of HYPE are taken by validators, voting in proportion to their stake. The Hyper Foundation runs several validators and holds a large share of staked HYPE.³⁹⁴⁰ Major features are specified as HIPs; the software is written and shipped by Hyperliquid Labs.

Incidents and controversiesReport an error

• North Korea concerns (December 2024). Security researchers flagged addresses linked to North Korean hackers trading on the platform, prompting record outflows. The team said no exploit had occurred.⁴¹
• ETH whale liquidation (March 2025). On 12 March 2025 a trader with a roughly 50x ETH long worth about US$300 million withdrew collateral and unrealized profit, leaving the position just above liquidation. When it was liquidated HLP took it over and lost about US$4 million. Hyperliquid then cut maximum leverage to 40x on BTC and 25x on ETH.⁴²
• JELLY delisting (March 2025). On 26 March 2025 a trader manipulated the price of the thinly traded JELLYJELLY token and left HLP holding a large short. Validators delisted the market and settled it at US$0.0095, turning a potential loss of about US$10 million for HLP into a gain of about US$700,000. Critics said the intervention showed that a small validator set could override market outcomes.⁴³
• API outage (July 2025). On 29 July 2025 Hyperliquid's API stopped serving requests for about 40 minutes, leaving traders unable to manage positions. Hyperliquid reimbursed affected users about US$2 million.⁴⁴⁴⁵
• Validator centralization. The validator set is small compared with other major layer 1s. In 2025 five Hyper Foundation validators held more than half of all stake.⁴⁶
• October 2025 liquidations. During the market crash of 10–11 October 2025, about US$10 billion of positions were liquidated on Hyperliquid, and it triggered cross-margin auto-deleveraging of profitable positions for the first time in over two years.⁴⁷
• POPCAT (November 2025). On 12 November 2025 a trader using 19 wallets opened large long positions in the POPCAT memecoin, supported by a large buy order. When the trader withdrew the order, the price fell, the positions were liquidated into HLP, and the vault lost about US$4.9 million.⁴⁸
• Transparency of positions. Because every position is public, traders with large positions can be targeted by others trying to push prices to their liquidation levels.⁴⁹ Critics, including Binance founder Changpeng Zhao, have argued that perpetual futures exchanges should hide positions; Yan has defended the transparency.

TimelineReport an error

See alsoReport an error

• Arbitrum, home of Hyperliquid's legacy USDC bridge
• Ethereum

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