The Almanack of Hyperliquid
I used to be a hater of Hyperliquid. The first time I started learning about it was at the beginning of 2024, and it didn’t click. Just some perp DEX on Arbitrum (like there were dozens of them elsewhere) with heavy centralization issues, closed-source node code, etc.
I even got banned from the Hyperliquid frontend because my address was flagged (I still don’t know the reason). I didn’t quite understand why @kirbyongeo, who I was working with at a venture fund, was so bullish.
After the TGE of $HYPE and its amazing token price performance, I started to dig even deeper and wanted to find out how Hyperliquid is different and why people are die-hard fans of the product.
Over multiple months of analysis and other external factors, which I’m going to talk about next, it led me to buy my first HYPE token in Q1 2026.
This essay is not about price predictions, how big Hyperliquid will be in the future, or why you should or shouldn’t buy.
This essay is about exactly how Hyperliquid is different, not only from perp DEXes and CEXes, but also from almost every other protocol in this space, and why you should at least get familiar with it.
Hyperliquid is one of the few “investable” assets in the whole world
In January 2026, when my whole feed was openclaw, AI agents, and how buying a Mac Mini will change your life, I caught big FOMO and asked myself 3 questions:
What will be valuable in the world if everything is made by AI?
What will be valuable in the world if USD rapidly depreciates and loses its value?
What’s worth investing in if both scenarios come true?
Fiat currencies are gone, the majority of precious metals are gone, and oil in the future is gone as well (that’s why the UAE and Gulf countries are developing new infrastructure and looking for more ways to make money).
In perspective, what’s left is crypto, metals and resources needed for AI development, gold, and the stock market. I’m not an expert in the stock market. I’m not an expert in precious metals either. I’m not an expert in crypto either, but at least I know way more than the average person, so I can craft some theses.
If we take the top 100 tokens by market cap, the majority of them can be excluded because “there are no use cases besides staking and governance.”
What’s left is: BTC, ETH, SOL, BNB, and HYPE.
Ethereum has become an ideological circlejerk with people out of touch with reality, where the Ethereum Foundation absolutely doesn’t care about ongoing problems and hides behind the “100% uptime credible settlement layer” thesis.
BNB is a very good option because of buybacks and burns, but I think to be an expert in this ecosystem you have to know Chinese to really understand what’s going on there and how to act. I don’t know Chinese.
Solana is an amazing and cool ecosystem, but it’s not currently clear exactly where SOL will be and what role it’s going to have in the future. High inflation exists as well.
What’s left is: BTC and HYPE.
I don’t think I need to say much about BTC (if you don’t believe in BTC, you don’t believe in crypto). If you zoom out, there are a lot of interesting protocols to invest in, but we’re looking for something with minimum risk and potentially high upside.
But there is a lot to say about HYPE and Hyperliquid in general.
Unlimited Upside of Having No Investors
Hyperliquid never raised capital, which is, in my opinion, the best decision they made at the start. Having no investors allowed Jeff to do whatever he wanted with the company. You don’t have to negotiate anything, you don’t have to spend time fundraising, and you don’t have to let external people know what you want to do before actually doing it. Complete freedom of action and decision-making.
You only raise capital if you don’t have enough money to start or want to capture an urgent opportunity in the market. Hyperliquid needed neither of those.
Take Telegram as another example of this thesis. People like Jeff Yang and Pavel Durov don’t need external capital, they made it themselves. What about other perks that VCs offer, like advising? People like Jeff know exactly what they’re doing and don’t need advice or external validation, he is confident in his own decisions.
I know dozens of teams who got pressured by VCs to leave one ecosystem and join another, release their token earlier, or delay and announce something later. Once you let external capital and additional board seats into your own company, it’s no longer your own company.
VCs’ business is to make money, and most of them are pretty impatient, so it was, in my opinion, the best decision Hyperliquid made: not letting venture capitalists in.
I’m not even talking about how VCs behave when a token goes live and they get a portion of their tokens unlocked: writing about the future of the protocol while dumping tokens on the open market. All of that was mitigated and avoided right from the very beginning of Hyperliquid.
HYPE Token & Utility
Why can there be no true competitor to the symbiosis of Hyperliquid and the HYPE token? Because there are no investors and no external influence.
A typical VC-backed exchange/chain has competing incentive structures. Early investors hold large token allocations with vesting schedules and don’t hesitate to dump as soon as they’re unlocked.
Chris Burniske claimed Celestia was the future of finance while dumping millions of $TIA on behalf of Placeholder VC. There are hundreds of such cases. Some VCs, like Polychain, don’t say anything publicly but still dump. So at the end of the day, 99% of products end up as a king-of-the-hill game: whoever dumps first wins.
Such a mechanic is impossible for $HYPE, because it doesn’t have private investors. The token’s value accrual (via buybacks) flows more directly between the protocol’s usage and the community/team holding the token, there’s no separate stakeholder class.
Why can’t competitors replicate it?
Well, because unfortunately, most of them are not as smart and as risk-taking as Jeff, who earned millions of dollars on his own before even starting a protocol like Hyperliquid.
Lighter has no advantage over Hyperliquid (enjoy being part of the sci-fi novel chains), and Aster was a fast attempt to conquer Hyperliquid, but no lasting financial infrastructure is built fast and out of envy. If you want to be aware of protocols that could compete with Hyperliquid, look for protocols that are at least 5+ years old.
Some would argue that token incentive design, network effects, or product execution matter more than cap table structure, and that “no VC = better alignment” is an oversimplification, which might be true. Tons of fair-launch protocols have failed, and a few VC-backed projects are successful, but if they’re successful, why does no one care about their tokens?
I use Uniswap and Aave on almost a daily basis, but why should I be interested in buying their tokens? To stake them and get even more (ouroboros), or vote in governance where private investors always have the majority of the voting rights? Thanks, I don’t need that.
If you look at Hyperliquid, even if you don’t trade perps, you might still be interested in owning $HYPE, because, as I said before, it’s one of the only investable tokens in crypto, thanks to countless not even smart, but “brave” decisions from the team.
Infinite Trading Instruments
Hyperliquid is far from integrating the majority of trading instruments, currently there are only perps and binary options (prediction markets) live. Given the combination of Hyperliquid’s infrastructure and the adoption of perps in general, it has a strong position to capture other markets in derivatives trading.
Hyperliquid has already brought more “traditional” markets to the platform, like precious metals and stocks. However, traditional trading instruments are still not introduced. I’m talking about vanilla put/call options.
HIP-3 has brought in a significant number of traders from outside the crypto space. In fact, most of the trading volume on Hyperliquid currently comes from precious metals, oil, and the S&P 500 rather than crypto assets. Given this new user base, it makes complete sense to introduce more tools they’re already familiar with.
No protocol has managed to make options stick in crypto for the long term: Hegic, Ribbon Finance, and Lyra all fell short. Aevo had real momentum and was even seen as a rival to Hyperliquid in 2024, but its order book remained offchain.
Hyperliquid is positioned to keep pulling crypto traders away from Binance, Bybit, and OKX, while also drawing in commodity traders from traditional exchanges, potentially dominating this segment of the options market entirely. The case for crypto traders switching to Hyperliquid is fairly obvious, and those moves will likely keep accelerating.
But the harder question remains the following.
Why would non-crypto options traders leave NASDAQ or NYSE for Hyperliquid?
NASDAQ is reportedly exploring 24/5 trading, but Hyperliquid is already operating 24/7. Lower fees, instant settlement, no size limits, reduced margin costs, greater capital efficiency, non-custodial design, and no geographic restrictions.
There’s a variety of reasons to move from traditional exchanges to Hyperliquid for the same assets, and beyond that, traders gain entirely new possibilities for building strategies with genuinely strong composability on HyperCore.
Unfortunately, I have no insights into future Hyperliquid updates, but I’m sure vanilla options will be added sooner than anticipated.
Team Attitude & Behaviour
Hyperliquid never invested money into marketing, and more importantly, into building its own ecosystem. The ecosystem play has always been the scam people have been falling for over the years.
Wasting investors’ money on grants for “builders” who will leave as soon as the grants run out (same as core teams who leave shortly after TGE). This culture of distributing ecosystem grants has always seemed stupid to me, and I’m happy to see people finally realizing it.
Where is Blast’s ecosystem? Berachain’s ecosystem? Movement’s ecosystem? Eclipse’s ecosystem? Sui’s ecosystem? zkSync’s ecosystem?
People who want to use Hyperliquid or build on it don’t need to talk to the Hyperliquid team directly. Smart decisions about setting a bar for market creation, no spam on the network.
Hyperliquid has a world-class team. Not in the sense that they hired the best people, but in the sense of management style. Don’t think of Google, Meta, or Apple, think of Rockstar, Telegram, Valve.
Hyperliquid is a prime example of the “Zero to One” philosophy from Thiel’s book. The idea of building a perp DEX is not new, but the idea of ruthless execution and literally not giving a damn about anything else is indeed new.
I run a research firm, and we’ve never done any paid marketing or ads, so Hyperliquid’s approach is something that deeply resonates with me. People will find out about a good product sooner or later and come, not because the company is screaming, but because it’s good and quiet.
Value of The Onchain Orderbook
Hyperliquid didn’t feel the competition with other perp DEXes and started competing with crypto CEXes and major CEXes. That alone says everything you need to know.
Its volume ratio to Binance has grown from 8% to 13.6% in recent months, and it has consistently outperformed Robinhood in trading volume. When a trader chooses where to open a perp position, Hyperliquid is now genuinely in the same consideration set as Binance or Bybit, something that wasn’t true for dYdX or GMX back in the day.
Another important thing to remember is that Hyperliquid emerged after the FTX crash, so you don’t have to convince people about the benefits of self-custody, as this is now pretty self-explanatory.
Traders tolerated CEX custody risk because DEXs were slower, less liquid, and more expensive (gas fees eating into PnL on every order). Once execution speed and depth became comparable to Solana or rollups, the only reason left to use a CEX was convenience/liquidity, which happened to be Hyperliquid’s field.
Funny how conversations about “DEX vs. CEX” back in the day were pretty lopsided, and then the conversation changed to “Hyperliquid vs. CEXes” and became very serious.
Despite being complete opposites, Hyperliquid and Binance have a lot in common. Hyperliquid mirrors how a CEX like Binance grew. Binance didn’t stay stuck as a spot exchange, but expanded by bundling futures, options, earn products, launchpads, etc. A platform that only does perps competes with other perp venues, a platform expanding its product surface starts competing with the category of “full-service exchange,” which is CEX territory.
You can learn more about the network effects of Hyperliquid here:
Hyperliquid Is Not Comparable to Either the Crypto Market or the Traditional Market
Most crypto people don’t understand interest rates, so they’re missing the actual flow mechanism driving Hyperliquid’s value. TradFi people dismiss crypto as not having “real” value, so they’re missing it too.
Hyperliquid competing on funding rates is like brokerages competing on margin rates — if you offer the cheapest leverage with no tradeoffs, large players will use your platform.
PURR 0.00%↑ and Hyperliquid Strategies are the only treasury companies in the world with a positive P&L.
Grayscale noted that Hyperliquid’s business model is more similar to traditional exchanges, but HYPE is a crypto asset rather than corporate equity.
While Grayscale’s HYPE ETF is live, it’s still kind of a sideshow. The real catalyst is that Hyperliquid could become a venue where the largest institutional players come to access cheap leverage — if Hyperliquid’s funding rates on perps undercut what’s available elsewhere, capital flows in regardless of whether participants care about crypto.
Traditional valuation frameworks cannot be applied here, because the product is fundamentally different from anything else. HYPE is not a stock (no dividends, no equity claim, no corporate structure), but it also isn’t a “pure” speculative crypto asset disconnected from cash flows (say hello to 99.9% of protocols in the space).
Architecture + Behavior Combination Is Unusual
Hyperliquid operates with an open architecture staying true to DeFi principles like transparency and self-custody, while simultaneously being structured around a highly optimized core application that has proven it can attract and retain users.
It’s both an open, composable protocol (like DeFi infrastructure) and a polished, sticky consumer product (like a well-run exchange app). Most projects are one or the other, in Hyperliquid’s case, you don’t have to pick a side.
Don’t evaluate Hyperliquid
Hyperliquid earned around $800 million in 2025, but that’s still only about 2% of total crypto perp transaction revenue, and its revenue is small compared to the massive traditional global derivatives industry. If Hyperliquid’s adoption continues, who knows how high the numbers will go in the future.
Hyperliquid is:
A token that behaves like a profitable and growing business
A DeFi protocol with the retention/UX of a centralized app
A separate product that unites web2 and web3 traders
So any single comparison set (crypto-only, equity-only, or exchange-only) undersells some dimension of it. Yet, there is no benchmark or framework that correctly rates whether Hyperliquid is overvalued or undervalued, so form your own opinion or thesis about it.
Hyperliquid.