Bitcoin
BTC
$
00000.00
-0.00%
Ethereum
ETH
$
00000.00
-0.00%
Solana
SOL
$
00000.00
-0.00%
XRP
XRP
$
00000.00
-0.00%
Dogecoin
DOGE
$
00000.00
-0.00%
ChainLink
LINK
$
00000.00
-0.00%
Binance Coin
BNB
$
00000.00
-0.00%
Cardano
ADA
$
00000.00
-0.00%
Litecoin
LTC
$
00000.00
-0.00%
Ordinals
ORDI
$
00000.00
-0.00%
Polygon
MATIC
$
00000.00
-0.00%
Optimism
OP
$
00000.00
-0.00%
Arbitrum
ARB
$
00000.00
-0.00%
Polkadot
DOT
$
00000.00
-0.00%
Avalanche
AVAX
$
00000.00
-0.00%
Sui
SUI
$
00000.00
-0.00%
Ethereum Classic
ETC
$
00000.00
-0.00%
FileCoin
FIL
$
00000.00
-0.00%
Celestia 
TIA
$
00000.00
-0.00%
Injective
INJ
$
00000.00
-0.00%

Key Takeaway

Hyperliquid redefines on-chain perpetual trading, processing over $1 billion daily. It stands out for its zero gas fees, capability for 50x leverage, and ability to handle 20,000 transactions per second. The platform’s Hyperliquid DEX has now overtaken dYdX as the most popular in DeFi, largely thanks to its broader selection of over 127 tradable assets.

Hyperliquid deepens its community engagement by introducing a points program and the $PURR meme coin, which was airdropped to points holders. Users can earn points that will be exchanged for a future governance token by trading and providing liquidity on the platform.

This review and rating adhere to our editorial policy and the the research methodology of StacksOnChain analysts, guaranteeing the accuracy and reliability of our reports.

Rating

What is Hyperliquid?

Hyperliquid is the largest decentralized perpetual trading platform that has surpassed dYdX with a daily volume exceeding $1 billion, entirely managed on-chain. Its key asset, a high-performance DEX for perpetual contracts, efficiently manages trades, liquidations, and funding with less than one-second block latency and supports up to 20,000 orders per second.

Hyperliquid Labs, powered by a team from Harvard, Caltech, and MIT with careers spanning top-tier firms like Citadel and Nuro, drives the platform’s innovation. This expertise delivers robust features such as up to 50x leverage with zero gas fees. 

Additionally, Hyperliquid's recent launch of a points program, anticipated to contribute to the governance token reaching a valuation akin to dYdX's billion-dollar market cap, significantly enhances user incentives.

What is Hyperliquid?

Hyperliquid DEX Features

The Hyperliquid DEX is the flagship application on the Hyperliquid L1 platform, and offers a range of features designed to optimize trading efficiency and user experience in decentralized finance (DeFi). Here are some of the core features of the DEX:

  • Broad Asset Selection: Hyperliquid DEX boasts over 127 tradable assets, the most among DeFi perpetuals protocols. This includes popular cryptocurrencies like ETH, SOL, BTC, and emerging assets like WIF, SEI, ARB and TIA.
  • High Throughput: The platform supports up to 20,000 orders per second, catering to both retail and institutional market makers, ensuring smooth and efficient market operations even during peak times.
  • Advanced Order Types: Traders can utilize advanced order types such as TWAP (Time Weighted Average Price), Scale, and TP/SL (Take Profit/Stop Loss) which are integrated directly into the TradingView charts.
  • Zero Gas Fees and Low Trading Fees: Trading on Hyperliquid incurs zero gas fees, maker rebates, and competitively low taker fees at 0.01%.
  • High Leverage: The platform offers up to 50x leverage, providing traders with the opportunity to maximize their capital efficiency and enhance returns on volatility.
  • Seamless Trading Experience: Hyperliquid enables one-click trading without wallet approvals interrupting the flow, facilitating a seamless user experience that is both intuitive and efficient.
  • Security and Proof of Stake: The L1 chain is secured by a proof of stake mechanism, where staking and slashing principles help maintain the integrity and robustness of the network.

These features illustrate Hyperliquid DEX’s commitment to providing a powerful, efficient, and user-friendly trading platform that stands competitive among decentralized and centralized trading platforms.

Hyperliquid DEX Features

Hyperliquid Funding Rates

Funding rates on Hyperliquid are designed to keep the price of perpetual contracts aligned with the actual market price of the underlying asset. This is achieved through a combination of a fixed interest rate and a variable premium that adjusts based on the price difference between the perpetual contract and the spot price.

Here’s a high-level breakdown of how funding works on Hyperliquid:

  • Interest Rate: It is set at a small fixed rate of 0.01% every 8 hours. This rate mirrors the cost difference of borrowing USD versus cryptocurrencies and is a standard industry practice.
  • Premium: This is where adjustments happen. If the price of the perpetual contract is higher than the spot price, the funding rate is positive, meaning those who are long will pay those who are short. Conversely, if the perpetual price is lower, the rate turns negative, and those who are short compensate those who are long.
  • Hourly Payments: Unlike some platforms that update funding rates every 8 hours, Hyperliquid updates its funding rate every hour, allowing for more frequent adjustments that better reflect current market conditions.
  • Rate Cap: Hyperliquid limits the funding rate to a maximum of 4% per hour, ensuring that charges remain reasonable even in volatile market conditions.

This setup promotes fair trading on Hyperliquid by supporting trades that balance any price differences with the underlying asset, which helps stabilize the market on the platform. You can check the current Hyperliquid funding rates on their dashboard.

Hyperliquid Funding Rates

Trading Fees

Hyperliquid's trading fees are transparently detailed in their documentation, making it easy for users to understand and highlighting their competitive position in the industry. Here’s a quick look at what makes them a market leader:

  • Fee Calculation: Fees are determined by a 14-day rolling trading volume, ensuring active users benefit from potentially lower fees based on their trading activity.
  • Fee Structure: From June 2023, Hyperliquid set taker fees at 2.5 basis points (bps) and offers a maker rebate of 0.2 bps, rewarding market makers and enhancing liquidity.
  • Referral Program: The platform rewards referrers with 10% of the taker fees from referred users, applicable up to the first $25M in volume.
  • Community Allocation: All trading fees are directed towards the user community through contributions to Hyperliquid's insurance fund and the Hyperliquidity Provider (HLP), supporting a sustainable trading environment.

This fee system reflects Hyperliquid’s commitment to transparency and community benefits, differing significantly from models where only insiders gain.

Hyperliquid Points Program

Hyperliquid's points program, which began on November 1, awards 1,000,000 points weekly to active users for six months, fostering continued engagement and loyalty. The program also features an affiliate matching initiative where affiliates earn one point for every four points earned by their referrals, thus encouraging user base expansion and platform promotion.

Furthermore, the points are anticipated to hold significant economic value, potentially linking to a future Hyperliquid governance token airdrop, reminiscent of successful precedents like dYdX. A snapshot for closed alpha users was taken on October 31 to ensure their participation in a special points drop, with Hyperliquid regularly adjusting the criteria for points distribution to meet its strategic objectives.

Hyperliquid Points Program

$PURR Meme Coin

$PURR is the first token launched under Hyperliquid L1's new standards HIP-1 and HIP-2, designed to facilitate on-chain spot trading and permanent liquidity ("Hyperliquidity") mechanisms. 

With no initial sale or planned utility, $PURR's role is primarily to pioneer these features. It has a fixed supply of 1 billion tokens: 50% has been distributed to Hyperliquid points holders, and the other 50% is locked as permanent liquidity in the PURR/USDC pair. Since its launch, $PURR now commands over $30 million in daily trading volume and holds a market valuation exceeding $60 million.

Closing Thoughts

Hyperliquid is a formidable player in the decentralized trading space, processing over $1 billion daily and enabling 20,000 transactions per second with features like zero gas fees and up to 50x leverage. The platform's innovative points program and $PURR meme coin initiative stand out as strategic moves to bolster user engagement and expand its ecosystem. 

Furthermore, Hyperliquid’s transparent fee structure and real-time funding adjustments ensure market integrity while rewarding its community, setting it apart as a pioneering force in decentralized finance.

Author

Richard Zhang, the founder of StacksOnChain, comes with a rich history in finance and a background as a High-Frequency Trading engineer and computer science scholar. With over a decade in the industry, he fervently advocates decentralized financial systems, imparting his extensive knowledge to a global readership.

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