An independent, plain-English guide · facts checked October 2026

What is Hyperliquid? Unpacked.

Hyperliquid is a purpose-built blockchain that runs a full exchange order book on-chain. A team of about a dozen people, with no venture funding, built it into the largest decentralised venue for perpetual futures. This guide explains how it works, who is behind it, what the HYPE token does, and where the real risks are.

Start with the 60-second version Read the risks first

Feb 2023Trading opened, about three months after the FTX collapse

31%of all HYPE given to roughly 94,000 early users on 29 Nov 2024

$0raised from venture capital; no private investor allocation

~$14.7Bopen interest in Sept 2026, about 76% of tracked perp-DEX open interest

Plain warning. Hyperliquid's main product is leveraged perpetual futures. Leverage magnifies losses, positions can be wiped out in minutes, and most retail traders who use it lose money. This site explains; it does not recommend trading, and nothing here is financial advice.

Live market data

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HYPE price—

24h change—

Market cap—

24h volume—

Circulating supply—

Fully diluted value—

All-time high—

Rank—

Loading live figures from CoinGecko…

Snapshot · checked October 2026

If the live feed is unavailable, here is the picture as of our last check. HYPE set a series of records in September 2026, first passing $90 on 18 September, with trackers showing a peak in the high $90s late that month. It traded around $82–85 on 12 October 2026. At $88 in early September the market cap was reported at close to $20 billion.

Circulating-supply figures differ between trackers (roughly 225–260 million HYPE in 2026) because they treat staked, foundation and burned tokens differently. Treat any single market-cap figure as approximate.

How to read these numbers

Market cap counts only circulating tokens. Fully diluted value multiplies the price by all tokens that exist, including locked ones, and is several times larger for HYPE.
Price is not the protocol. Hyperliquid's own activity is measured in trading volume, open interest and fees, covered in section 07.
Nothing on this page is a forecast. Past price moves say nothing reliable about future ones.

Hyperliquid in 60 seconds

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It is a blockchain built to be an exchange.Hyperliquid is its own layer-1 chain. Its core component, HyperCore, runs spot and perpetual-futures order books directly on-chain, with every order and trade recorded publicly.
Its main product is perpetual futures."Perps" are contracts that track a price without ever expiring, usually traded with borrowed exposure (leverage). They are high-risk instruments.
You keep your own keys.You connect a crypto wallet instead of opening an account. There is no identity check in the protocol, which is also why regulators watch it closely and why US users are blocked on the main site.
HYPE is the native token.It is staked to secure the chain, pays gas on HyperEVM, earns fee discounts and is required as a bond to launch new markets. Almost all trading fees are used to buy HYPE and burn it.
There were no investors.Founder Jeff Yan and a small team funded it themselves. In November 2024, 31% of the 1 billion HYPE supply went to users in one of crypto's largest airdrops.
It is powerful and contested.Fans see the first on-chain venue to rival big exchanges. Critics point to a small validator set, closed-source node software, emergency interventions and manipulation episodes. Both views appear in this guide.

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Origins: a trading firm that built its own exchange

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Hyperliquid did not begin as a blockchain project. It began as a small proprietary trading firm whose founder decided, after watching FTX fail, that the exchange itself was the thing worth building.

From Chameleon Trading to an exchange

Jeff Yan studied mathematics and computer science at Harvard, interned at Hudson River Trading and joined its US equities team full time in late 2017. He left after roughly eight months. A first start-up, a prediction market called Deaux incubated by Binance Labs in 2018, gained little traction and was wound down, with more than half of the money raised reportedly returned.

In late 2019 Yan started Chameleon Trading, a crypto market-making firm, reportedly with about $10,000 of his own capital. By 2022 it had around six people and was a meaningful liquidity provider on centralised exchanges.

In November 2022 FTX collapsed with billions of dollars of customer money missing. According to a long 2026 profile in Colossus, Yan halted Chameleon's trading and redirected the team toward building an exchange where customers hold their own funds and every action is publicly verifiable. Some team members left rather than make the switch.

Writing a chain in three months

The team concluded that no existing blockchain was fast enough to run a serious order book, so they wrote their own. Trading opened in late February 2023, initially for a small group and with a handful of perpetual markets. Early versions used Tendermint consensus; the team later replaced it with its own design, HyperBFT.

In May 2023 the firm's market-making strategies were placed into a public vault, the Hyperliquidity Provider (HLP), which anyone could deposit into. That solved the cold-start problem every new exchange faces, which is that nobody wants to trade where there is no liquidity.

No investors, by choice

Hyperliquid Labs has never taken outside funding. Yan reportedly turned down about $100 million of venture money at a $1 billion valuation in January 2024. In a post that month he described the project as having no investors, no paid market makers and no fees going to the company.

The practical consequence came in November 2024. With no investors to allocate tokens to, the genesis distribution of HYPE gave 31% of supply to users and nothing to private backers.

Why does "no VC" matter so much to its supporters?And one honest caveat

Most crypto tokens launch with a large share held by venture funds that bought early at low prices and can sell once their lock-ups end. Hyperliquid's launch had none of that overhang, which many users saw as fairer.

The caveat is that "no investors" is not the same as "no insiders". Core contributors hold 23.8% of supply, and the Hyper Foundation and a large reserve for future emissions are controlled by a small group. Concentration exists; it simply sits with the team and foundation instead of with funds.

The points programme that preceded the airdropLate 2023 to 2024

From late 2023 Hyperliquid awarded weekly "points" to traders based on activity. Points had no stated value, but users widely expected them to convert into tokens. They did: the November 2024 genesis distribution was allocated largely on points. This playbook, a points campaign followed by a token, has since been copied by nearly every competing perp exchange, and it is one reason headline trading volumes on newer venues need careful reading.

Where is Hyperliquid based?Labs, Foundation and jurisdiction

Hyperliquid Labs, the main developer, is reported to be based in Singapore, where Yan has lived since 2024. The Hyper Foundation is a separate entity that supports the ecosystem and holds the foundation token budget. Neither is licensed as an exchange in Singapore, and in June 2026 the Monetary Authority of Singapore added Hyperliquid to its Investor Alert List, a warning that an entity may be wrongly assumed to be regulated there. It is not a ban.

Timeline, 2019 to October 2026

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Filter by theme. Red markers are incidents, amber are regulatory events and blue are token events.

2019

Late 2019ProductChameleon Trading begins
Jeff Yan starts a crypto market-making firm after leaving Hudson River Trading. Its people and code later become Hyperliquid.

2022

Nov 2022MarketFTX collapses
With customer funds missing at a major exchange, Yan halts Chameleon's trading and turns the team to building a self-custodial exchange on its own chain.

2023

Feb 2023ProductHyperliquid opens for trading
The chain goes live with a small set of perpetual markets after roughly three months of development.
May 2023ProductHLP vault opens to the public
The team's market-making strategies move into a community vault that anyone can deposit USDC into.
Late 2023TokenPoints programme starts
Traders earn weekly points with no stated value. They later form the basis of the airdrop.

2024

Jan 2024MarketVenture money declined
Yan reportedly turns down about $100 million at a $1 billion valuation and restates that the project has no investors.
2024ProductSpot trading, HIP-1, HIP-2 and HyperBFT
Native spot tokens arrive, starting with the memecoin PURR. The chain's consensus is replaced with the team's own HyperBFT.
29 Nov 2024TokenHYPE genesis and airdrop
One billion HYPE are created. 31% (310 million) goes to about 94,000 early users, with no allocation to investors or exchanges.
Dec 2024IncidentNorth Korea wallet scare
A security researcher links trading addresses to North Korean hackers. More than $250 million reportedly leaves in a day; no exploit occurs.
30 Dec 2024TokenStaking goes live
HYPE holders can delegate to validators on mainnet.

2025

Jan 2025IncidentValidator critique
An open letter criticises closed-source code and foundation control of more than 81% of stake across 16 validators. The team promises to decentralise.
Feb 2025ProductHyperEVM mainnet and native BTC spot
Ethereum-style smart contracts launch on 18 February. Unit brings spot bitcoin deposits and withdrawals.
12 Mar 2025IncidentETH whale costs HLP about $4M
A trader engineers a liquidation of a huge leveraged ETH long into the vault. Leverage limits are tightened.
26 Mar 2025IncidentJELLY squeeze and delisting
A memecoin squeeze pushes HLP toward a $12–13.5 million loss. Validators delist the market and settle it at a protective price within minutes.
Apr 2025ProductValidator set opens to 21
Registration becomes permissionless, with the 21 largest stakes forming the active set.
May 2025RegulationFirst formal engagement with the CFTC
Hyperliquid Labs submits comment letters to the US derivatives regulator on perpetuals and round-the-clock trading. A trader known as James Wynn loses roughly $100 million in public view.
Jul 2025MarketPhantom perps and a treasury company
Phantom wallet adds Hyperliquid perps through builder codes. Sonnet BioTherapeutics announces a merger to create Hyperliquid Strategies. A 29 July API disruption leads to refunds.
26 Aug 2025IncidentXPL pre-market squeeze
A thin pre-launch market is pushed up about 200% in minutes, liquidating shorts for tens of millions of dollars.
14 Sep 2025TokenNative Markets wins the USDH ticker
Validators choose a new team over Paxos, Frax, Agora, Sky and others to issue Hyperliquid's own stablecoin. Ethena had withdrawn.
Sep 2025MarketHYPE peaks near $59; rivals surge
HYPE sets a high of $59.30 on 18 September. Aster and Lighter take large shares of volume with points incentives.
10–11 Oct 2025IncidentRecord liquidation cascade
About $19 billion is liquidated market-wide, over $10 billion on Hyperliquid. Open interest falls from $14.7 billion to $6.5 billion and cross-margin ADL triggers for the first time.
13 Oct 2025ProductHIP-3 goes live
Anyone staking 500,000 HYPE can deploy perpetual markets, opening the way to stock, index and commodity perps. MetaMask adds Hyperliquid perps the same month.
12 Nov 2025IncidentPOPCAT attack
A deliberate manipulation leaves HLP with about $4.9 million of bad debt; the bridge is briefly paused.
29 Nov 2025TokenTeam tokens start vesting
The one-year lock on the 23.8% core-contributor allocation ends. Actual monthly distributions prove far smaller than schedule trackers imply.
Dec 2025TokenBurn vote passes; Hyperliquid Strategies lists
Validators vote about 85% in favour of recognising roughly 37 million Assistance Fund HYPE as burned. The treasury company's merger closes.

2026

18 Feb 2026RegulationHyperliquid Policy Center launches
A Washington advocacy group led by Jake Chervinsky opens with a 1 million HYPE grant from the foundation.
Mar 2026MarketLicensed S&P 500 perp
S&P Dow Jones Indices licenses its flagship index to Trade[XYZ]. HIP-3 open interest sets a record of $1.74 billion, led by oil and silver.
Apr 2026ProductPriority fees; FARTCOIN incident
Traders can pay HYPE, which is burned, for order priority. On 9 April a manipulation costs HLP about $1.5 million.
2 May 2026ProductHIP-4 outcome markets
Fully collateralised, prediction-style markets go live in limited form.
12–15 May 2026MarketFirst US spot HYPE ETFs
21Shares (THYP) launches on 12 May and Bitwise (BHYP) follows that week. Grayscale's staking fund arrives in early June.
14 May 2026TokenCoinbase and Circle take over the stablecoin role
USDC becomes the aligned quote asset with about 90% of reserve yield shared with the protocol. USDH is wound down and its brand sold to Coinbase.
15 May 2026RegulationCME and ICE lobby against Hyperliquid
Bloomberg reports the two exchange groups pressing US officials to bring Hyperliquid under CFTC oversight, citing oil-price manipulation risk.
21 May 2026MarketNew all-time high above $62
HYPE passes its September 2025 record.
Jun 2026Regulation27 validators; Singapore alert list
The validator set grows to 27. On 26 June the Monetary Authority of Singapore adds Hyperliquid to its Investor Alert List.
27 Jul 2026IncidentSK Hynix oracle cascade
A bad print on a Korean exchange feeds a HIP-3 market, liquidating about $57 million of longs. Deployer Trade[XYZ] says it will cover losses.
19 Aug 2026RegulationWhite House signals a US route
President Trump says the CFTC is working to bring Hyperliquid onshore. Coinbase's Base app begins routing perps through Hyperliquid.
31 Aug 2026RegulationPayward talks reported
Bloomberg reports discussions with Kraken's parent about US market entry.
Sep 2026MarketOpen interest back to $14.7B; HYPE above $90
Open interest returns to pre-crash levels and HYPE passes $90 on 18 September. Stablecoin borrowing against BTC and HYPE launches.
29 Sep 2026RegulationHouse Oversight records request
Chairman James Comer asks Hyperliquid how it identifies users and reports suspicious trades.
Oct 2026MarketOptions plan, Bloomberg Terminal, $1.4B revenue
Yan says options are coming. Bloomberg adds Hyperliquid prices. Cumulative revenue passes $1.4 billion with over $1.26 billion spent on buybacks. Labs sells 3.75 million HYPE privately to one institution.
11 Oct 2026IncidentPapertrade loses $1.28M via Hyperliquid's book
A trader moves Hyperliquid's ETH order book to profit on another exchange that used it as a price reference.

How it works

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Three layers do the work: a consensus engine called HyperBFT, an exchange engine called HyperCore, and a general-purpose smart-contract environment called HyperEVM. All three share one chain and one set of validators.

Layer 1 of 3

HyperBFT: agreeing on order

Validators who stake HYPE take turns proposing blocks and vote to finalise them. The design descends from the HotStuff family of protocols. Blocks are produced in a fraction of a second, and the team says the system handles about 200,000 orders per second. Like all such protocols it tolerates up to a third of stake misbehaving.

Layer 2 of 3

HyperCore: the exchange

HyperCore holds the order books, margin accounts, the liquidation engine, funding payments, vaults and staking. It is not a smart contract running on a general chain; it is native chain logic written for one job. Placing or cancelling an order costs no gas.

Layer 3 of 3

HyperEVM: everything else

Launched on mainnet in February 2025, HyperEVM runs Ethereum-style smart contracts, with HYPE as gas. Contracts can read HyperCore prices and send it instructions, so lending markets, liquid-staking tokens and other apps can build on the exchange's liquidity.

Order books versus pools

Most early decentralised exchanges, such as Uniswap, used automated pools: you trade against a formula. Traditional exchanges use a central limit order book: buyers post the prices they will pay (bids), sellers post the prices they will accept (asks), and a matching engine pairs them by price first, then time. Order books give tighter prices for large, active markets, but they need a very fast system. Hyperliquid's bet was that a chain designed only for this could keep the whole book on-chain. Try it below.

Explainer 1 · Order-book matchingsimulated market · not real prices

Place an order and watch it match

Side

Order type

Limit price

Size (units)

Try a limit buy at 100.2 for 8 units. It crosses the best ask, so part of it fills at once.

What to notice: a limit order that does not cross the spread rests on the book and makes you a maker. An order that fills against resting orders makes you a taker, and takers pay the higher fee (0.045% versus 0.015% for perps at Hyperliquid's base tier). A large market order "walks the book" and gets a worse average price. That gap is slippage.

Perpetual futures for beginners

A perpetual future is an agreement between two traders that tracks the price of something, such as bitcoin, oil or a stock index. You never own the underlying asset. If you are long you gain when the price rises; if you are short you gain when it falls. For every long there is a short on the other side. It is a zero-sum game before fees and a negative-sum game after them.

Four ideas explain almost everything that happens to perp traders:

Margin is the collateral you post, on Hyperliquid normally USDC.
Leverage is position size divided by margin. With $1,000 of margin at 10x you control a $10,000 position, so a 1% move changes your margin by about 10%.
Liquidation happens when losses eat your margin down to the maintenance level. The system closes your position by force and you generally lose most or all of the margin behind it.
Funding is a regular payment between longs and shorts that keeps the perp price close to the real ("spot") price.

Cross vs isolated margin

Isolated margin limits a position's possible loss to the collateral assigned to it. Cross margin shares your whole account balance across positions, which delays liquidation but puts everything at stake. Hyperliquid added portfolio margin in stages from late 2025, which nets spot and perp positions together for larger accounts and lets eligible collateral such as HYPE and BTC be borrowed against.

Mark price and oracles

Liquidations are triggered by a mark price, not the last trade. For core markets it blends Hyperliquid's own book with an oracle price that validators compute from major external exchanges. This is meant to stop a single odd trade from liquidating people. As several incidents in section 14 show, it does not make thin markets safe.

Explainer 2 · Leverage and liquidationrisk education · not a trading tool

This simulator exists to show how little room high leverage leaves. It is simplified, ignores fees and funding, and must not be used to plan trades.

Direction

Leverage 10x Margin you post (USDC) $1,000 Entry price $100,000

Position size Each 1% move against you costs Maintenance margin assumed1.25% of position

Your position is liquidated after a move of

Formula (isolated margin, simplified from Hyperliquid's documentation): liquidation price = entry − side × entry × (1/leverage − m) / (1 − m × side), where m is the maintenance-margin fraction (1.25% here, matching a market with 40x maximum leverage) and side is +1 for long, −1 for short. Real liquidations also depend on fees, funding, cross-margin balances and the mark price.

Funding: the price of keeping a perp in line

A perp never expires, so nothing forces its price back to the real price. Funding does that job. When the perp trades above spot, longs pay shorts, which makes holding a long less attractive. When it trades below, shorts pay longs. On Hyperliquid funding is exchanged every hour, peer to peer; the protocol does not keep it. The rate combines a small fixed interest component with a premium based on how far the perp is from the oracle price.

Explainer 3 · Funding ratesillustrative numbers

Perp price vs spot Position size Leverage used

Longsbet on the price rising

→

Shortsbet on the price falling

Funding rate per hour Equivalent per year (if it stayed constant) Paid on this position per day As a share of your margin, per 30 days

This model uses a simple rule: hourly rate = (fixed 0.00125% interest + the premium you set) with the premium spread over eight hours. Hyperliquid's real formula samples the order book every few seconds, clamps small premiums toward the interest rate and caps funding at 4% per hour. The lesson holds either way: funding is charged on the full position, so with leverage it can quietly consume margin even when the price goes nowhere.

Beyond perps: the rest of the system

Spot trading, HIP-1 and HIP-2Native tokens with their own order books

HIP-1 is the standard for tokens issued natively on HyperCore, each with a spot order book. Ticker names are sold by Dutch auction, which is how projects obtain a listing without asking anyone's permission. HIP-2 ("Hyperliquidity") lets a token launch with an automated, on-chain market-making strategy so that a new book is not empty. Spot trades are real purchases with no leverage and no liquidation, though the price can still fall.

Unit and native BTC, ETH and SOLHow real bitcoin reaches a Hyperliquid order book

Hyperliquid has no native bitcoin. Unit is a tokenisation layer whose operators hold deposits on the original chains and mint matching tokens on Hyperliquid (shown as UBTC, UETH, USOL and others). Spot bitcoin trading via Unit began in February 2025, with ether and solana following later in 2025. You can deposit real BTC and withdraw real BTC, but while it is on Hyperliquid you rely on Unit's guardian network holding the collateral. That is a custody-style trust assumption worth knowing about.

HLP: the community vaultMarket maker, liquidator of last resort, and not a savings account

The Hyperliquidity Provider vault takes USDC deposits and runs market-making strategies across perp markets. It also acts as a backstop: when a liquidated position cannot be closed on the book, HLP takes it over. Depositors share profits and losses pro rata and there is no performance fee. Deposits have a short lock-up (four days at the time of writing).

A CoinGecko analysis in mid-2026 put HLP's cumulative profit at about $137 million since May 2023, with roughly two-fifths earned in just two violent liquidation events. Its deposits had fallen from a peak near $600 million in September 2025 to under $270 million by June 2026. It has also been the target of deliberate attacks that left it with losses (see section 14). Returns are lumpy and losses are possible.

Liquidations and auto-deleveraging (ADL)What happens when the backstop is not enough

When an account falls below maintenance margin, Hyperliquid first tries to close it on the order book. If the account's value falls much further, the position passes to HLP. If even that cannot absorb the loss, auto-deleveraging closes part of the positions of the most profitable, most leveraged traders on the other side at the mark price, so the system as a whole stays solvent. ADL means a winning trader can have a hedge or profitable position cut without consent. Hyperliquid's cross-margin ADL fired for the first time on 10 October 2025.

HIP-3: markets built by outside teamsStocks, indices, oil and gold as perps

Since 13 October 2025, anyone who stakes 500,000 HYPE can deploy their own perpetual markets on HyperCore, choosing the oracle, leverage limits and fees, and keeping up to half the trading fees. The stake can be slashed by validators for misconduct. This opened the door to perps on equities, indices, commodities and even pre-IPO companies. The largest deployer, Trade[XYZ], obtained a licence from S&P Dow Jones Indices for an S&P 500 perp in March 2026.

These markets grew fast: HIP-3 open interest passed $4.4 billion in August 2026, and real-world-asset markets were more than half of weekly volume for two consecutive weeks in July 2026. They also carry deployer-specific risk. In July 2026 a single erroneous print on a Korean exchange pushed Trade[XYZ]'s SK Hynix perp down about 18% and liquidated roughly $57 million of long positions; the deployer chose to reimburse users.

HIP-4: outcome marketsPrediction-style contracts, live since May 2026

HIP-4 went live on 2 May 2026 in a limited form. Outcome markets are fully collateralised contracts that settle to a fixed value depending on an event, so there is no leverage and no liquidation. At launch only a couple of daily markets run by the core team existed, and permissionless deployment had not yet opened as of mid-2026.

Builder codesHow wallets and apps plug in and get paid

A builder code lets a third-party app route a user's order to Hyperliquid and add its own small fee, which the user must approve on-chain first (capped at 0.1% on perps and 1% on spot). Phantom added Hyperliquid perps this way in July 2025 and MetaMask followed in October 2025. In August 2026 Coinbase said its Base app would route perps trading through Hyperliquid. Much of Hyperliquid's growth now arrives through front ends it does not operate.

Getting dollars in: the bridge and native USDCFrom an Arbitrum bridge to Circle's CCTP

For its first years Hyperliquid's collateral was USDC locked in a bridge contract on Arbitrum, secured by Hyperliquid's validators. That bridge held several billion dollars and was a frequently cited single point of risk. Circle then deployed native USDC and its cross-chain transfer protocol (CCTP) on Hyperliquid, so USDC can be minted and redeemed directly. After the May 2026 stablecoin agreement, analysts reported the Arbitrum bridge balance had fallen below $1 billion as native minting took over.

Priority fees, borrowing and what is next2026 additions

In April 2026 Hyperliquid introduced priority fees: traders who want faster order placement can pay in HYPE, and those fees are burned. In September 2026 it enabled manual borrowing of stablecoins against BTC and HYPE collateral, with about $269 million borrowed in the first day according to market trackers. In October 2026 Yan said options trading is planned, without giving a date.

HYPE tokenomics

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One billion HYPE were created at genesis on 29 November 2024. No more can be minted beyond that cap, and since then the supply has been shrinking as fees are used to buy tokens and burn them.

Genesis allocation as published by the Hyper Foundation in November 2024. Select a slice for detail.

What HYPE is used for

Staking and security. Validators and their delegators stake HYPE to run HyperBFT. Yield was around 2–2.5% a year in 2026 and falls as more is staked.
Gas. HYPE pays transaction fees on HyperEVM.
Fee discounts. Staking more than 10 HYPE cuts trading fees by 5%, rising in tiers to 40% above 500,000 HYPE.
Deployment bonds. HIP-3 market deployers must stake 500,000 HYPE. Circle and Coinbase each committed to stake HYPE under the 2026 stablecoin arrangement.
Governance by stake. Validator votes are weighted by staked HYPE. This is how the USDH ticker, the JELLY delisting and the 2025 burn recognition were decided.

Team unlocks: schedule versus reality

The 23.8% core-contributor allocation (238 million HYPE) was locked for one year after genesis and began vesting on 29 November 2025, with the foundation saying most vesting completes in 2027–2028. Unlock trackers model this as roughly 9.9 million HYPE a month, which produces alarming headlines.

What the team has actually distributed is far smaller. Hyperliquid Labs announces a figure and pays out on the 6th of each month: about 1.75 million HYPE in November 2025, 1.2 million in January 2026, then a few hundred thousand a month through spring 2026, according to Tokenomist's on-chain tracking. In October 2026 Labs unstaked 3.75 million HYPE that co-founder iliensinc said was for a private over-the-counter sale to a single institution; the buyer and terms were not disclosed.

The honest summary is that a very large amount of team supply is technically vested and unsold. That is reassuring about behaviour so far and still a real overhang.

The Assistance Fund: fees in, HYPE out

Hyperliquid's defining economic feature is that the protocol keeps almost nothing. Trading fees go to the community: a small share to HLP and to market deployers, and the rest, roughly 97% of core-market fees according to DefiLlama, to an on-chain address called the Assistance Fund. That address automatically uses the fees to buy HYPE on the open market.

Explainer 4 · From trading fee to burned tokenillustrative · move the sliders

Daily trading volume Average fee collected HYPE price

Fees per day To the Assistance Fund (97%) HYPE bought and burned per day Annualised share of 1B max supply

Illustrative arithmetic only. Real fee capture varies with fee tiers, rebates, HIP-3 "growth mode" discounts and builder markets, where deployers keep up to half. A buyback does not guarantee a rising price: revenue fell from a reported $457 million in Q3 2025 to $202 million in Q2 2026, and buybacks shrank with it.

Buybacks with dates

Dec 2025: the fund held about 37 million HYPE, worth close to $1 billion.
Q3 2025 vs Q2 2026: quarterly purchases of about $290 million and $149 million respectively, per The Block.
Mid-2026: more than $1.3 billion deployed cumulatively, per AMINA Bank research.
Early Oct 2026: cumulative protocol revenue above $1.4 billion and more than $1.26 billion spent on buybacks, as reported by Wu Blockchain and Crypto Briefing.

The December 2025 burn vote

The Assistance Fund address has no private key, so its HYPE could never be moved without a hard fork. Yet trackers still counted it as supply. On 17 December 2025 the Hyper Foundation asked validators to formally recognise those tokens as burned and to commit never to upgrade the protocol to access them.

The stake-weighted vote passed with about 85% in favour, removing roughly 37 million HYPE, more than a tenth of circulating supply at the time, from both total and circulating counts. Since then, purchases are burned automatically. By April 2026 trackers showed total supply near 962 million.

USDH: the stablecoin contest and its short life

Billions of dollars of USDC sat on Hyperliquid earning interest for Circle and Coinbase, not for Hyperliquid. In September 2025 the foundation invited teams to compete for the reserved USDH ticker, with validators voting by stake.

The contest drew bids from Paxos, Frax, Agora, Sky, Ethena and others, each promising to send most reserve income back to the ecosystem. Ethena withdrew before the vote. On 14 September 2025 validators chose Native Markets, a newly formed team led by Max Fiege, whose plan split reserve yield equally between the Assistance Fund and ecosystem growth, with reserves managed through Stripe's Bridge and BlackRock. Critics said the short timeline favoured a team with close ties to the ecosystem.

USDH launched later that month but never displaced USDC. On 14 May 2026 Coinbase announced it would become the official treasury deployer of USDC on Hyperliquid, with Circle as technical deployer, under a new "aligned quote asset" framework (AQAv2). Native Markets agreed to sell the USDH brand assets to Coinbase, USDH holders could redeem one-for-one into USDC, and USDH was wound down.

Under the published terms, Coinbase and Circle share about 90% of the reserve yield on Hyperliquid's USDC with the protocol, far above USDH's 50%. FalconX and Coin Metrics each estimated this at up to roughly $160 million a year at mid-2026 balances and interest rates, with the proceeds intended for further buybacks. Those are estimates and they fall if rates or balances fall.

Fees, revenue and market share

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Hyperliquid's share of the on-chain perps market has swung widely. The number you see depends heavily on whether you measure trading volume, which incentives can inflate, or open interest, which is harder to fake.

What it costs to trade

Market	Taker	Maker
Perps, base tier	0.045%	0.015%
Perps, top volume tier (>$7B / 14 days)	0.024%	0%
Spot, base tier	0.070%	0.040%
HIP-3 markets in "growth mode"	Protocol fee cut by 90%; deployer may add its own
HIP-4 outcome markets (launch phase)	0% to open and close, as of May 2026

From Hyperliquid's documentation, checked October 2026. Fees are charged on the whole position size, not on your margin, so at 20x leverage a 0.045% fee is 0.9% of your margin each way.

Revenue, by date

Period	Figure	Source
Full year 2025	About $2.9–3T volume; $857–907M fees	DefiLlama; community annual report
Q3 2025 (peak quarter)	$457M gross revenue	The Block
Q1 2026	About $493B volume	AMINA Bank
Q2 2026	$202M gross revenue	The Block
Jan–15 Sep 2026	$429M, the highest of any protocol tracked	CoinGecko data, as reported
Cumulative to Oct 2026	>$1.4B revenue	Wu Blockchain

How the market share has moved

When	Hyperliquid's position	What was happening
Mid-2025	Commonly cited at 70% or more of perp-DEX volume	Few serious rivals; HYPE airdrop effect; HyperEVM launch
Sept–Oct 2025	Volume share fell sharply; Aster briefly claimed most daily volume	Aster (backed by YZi Labs, the investment firm associated with Binance founder Changpeng Zhao, and by BNB Chain incentives) and Lighter ran aggressive points programmes; perp-DEX monthly volume passed $1 trillion
Early 2026	About 25–32% of 30-day volume; Lighter and Aster close behind	Lighter's token launched 30 Dec 2025, after which its volume dropped; Hyperliquid kept the largest open interest throughout
July 2026	About 37–38% of volume	Rivals lost ground as incentives faded; real-world-asset perps drove new users
8 Sept 2026	$14.6B of $19.2B tracked open interest, about 76%	Artemis data: Aster $2.5B, Lighter $1.1B, edgeX $0.6B

Against centralised exchanges

Among decentralised venues Hyperliquid is clearly the largest, yet it remains a fraction of Binance. Hyperliquid Strategies cited its share of global perp volume, including centralised exchanges, at about 9.4% at the end of June 2026. Coin Metrics described it in June 2026 as the third-largest perp venue by open interest. The whole decentralised sector grew from about 2% of perp volume in early 2023 to roughly a quarter by early 2026.

Why volume alone misleads

When an exchange rewards trading with points that later become tokens, people trade with themselves to farm them. Volume balloons while open interest, which needs real capital left at risk, barely moves. Aster's share peaked near 70% of volume in late 2025 with a fraction of Hyperliquid's open interest. When comparing venues, look at open interest, fees actually paid and depth of the order book.

People and organisations

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Hyperliquid is unusual for how few people built it and how little most of them say in public. One person is the public face.

Role: Co-founder; leads Hyperliquid Labs
Raised: Redwood Shores, California
School: Palo Alto High; Harvard (maths BA, CS master's, 2017)
Before: Hudson River Trading; Chameleon Trading
Based: Singapore (reported)

Deep profile

Jeff Yan

Yan grew up in the Bay Area, the son of Chinese immigrants, and was raised mostly by his mother, an accountant. He was a competition kid. He qualified for the US mathematics olympiad training camp in his early teens, then taught himself physics and won a silver medal at the 2012 International Physics Olympiad in Estonia and gold in 2013 in Copenhagen, where he placed 24th in the world.

At Harvard he studied mathematics and computer science, graduating in 2017 with a bachelor's and a master's. He interned on Google's self-driving car project and at Tower Research, and was in Hudson River Trading's intern class before joining its US equities algorithms team. He stayed about eight months. In interviews he has described high-frequency trading as an excellent education in building systems where a millisecond or a rounding error costs real money.

His first company, the prediction market Deaux (2018), failed to find users. His second, Chameleon Trading (from late 2019), did not: it became a profitable crypto market maker run by a handful of people, with Yan reportedly working fourteen-hour days from Puerto Rico. That firm's team, capital and code became Hyperliquid after FTX collapsed in November 2022.

Three choices define his reputation. He refused venture capital, including a reported $100 million offer in January 2024. He kept the team at roughly a dozen people. And he gave users, not insiders or funds, the largest share of the token. Supporters see principle; sceptics note that the team's own 23.8% allocation became worth many billions of dollars on paper. Yan has never disclosed his personal holdings, and published net-worth figures are guesses.

"We use crypto, but that doesn't define us."Jeff Yan, quoted in Colossus, April 2026 (via Datawallet's summary)

He is also a lightning rod. He defended the March 2025 JELLY intervention as protecting users. After the October 2025 crash he publicly argued that some centralised exchanges under-report liquidations by a wide margin. In September 2026 at Korea Blockchain Week he called private-company markets a major opportunity, and in October 2026 he said options were coming to the platform. A September 2026 records request from the US House Oversight Committee, focused on a large short opened before a tariff announcement in October 2025, was addressed to Hyperliquid; it makes no finding against Yan or the company.

Biographical details here come mainly from the Colossus profile (April 2026) as summarised by Datawallet, plus Fortune and The Block. Yan is private, and some early-life details rest on a single profile.

Co-founder

"iliensinc"

Yan's co-founder is a Harvard classmate who uses only a pseudonym in public. Iliensinc posts operational updates, including the monthly team-token distributions and the October 2026 private sale. Yan is the only core team member who uses his real name.

Developer

Hyperliquid Labs

The company that writes the core software. Reported at around eleven or twelve people, mostly engineers with trading-firm and top-university backgrounds. It takes no cut of trading fees. Its node software remained closed-source as of mid-2026, a long-standing criticism.

Steward

Hyper Foundation

A separate foundation that ran the genesis distribution, holds the 6% foundation budget, operates several validators, runs a delegation programme for independent validators and puts proposals to validator votes. Its mission line is to build "the blockchain to house all finance".

Policy

Hyperliquid Policy Center

An independent Washington advocacy group launched on 18 February 2026 with a grant of 1 million HYPE (about $28 million then) from the foundation. Its chief executive is the crypto lawyer Jake Chervinsky, formerly of the Blockchain Association and Variant. Its first priority is a US legal framework for perpetual derivatives.

Validators

The validator set

Twenty-seven validators as of June 2026, up from four at launch and sixteen in January 2025. Operators include professional staking firms, trading firms and treasury companies. The foundation runs five and, after redelegating, held about 49% of stake in mid-2026.

Builders

Deployers and front ends

Trade[XYZ] and the Unit team (the largest HIP-3 deployer and the tokenisation layer), Kinetiq (liquid staking), Felix and HyperLend (lending), and wallets such as Phantom and MetaMask that route orders with builder codes.

Treasury companies and funds that hold HYPE

Vehicle	What it is	Status (checked Oct 2026)
Hyperliquid Strategies (Nasdaq: PURR)	Treasury company formed by merging Sonnet BioTherapeutics with a Paradigm-affiliated vehicle; chaired by former Barclays chief Bob Diamond, led by David Schamis	Merger closed December 2025. Held 29.3 million HYPE at its 2026 fiscal year-end, nearly all staked; no debt; runs a validator with Unit
Hyperion DeFi (Nasdaq: HYPD)	Formerly the eye-care company Eyenovia; pivoted to a HYPE treasury in 2025	About 2 million HYPE at end of Q2 2026; lends its HYPE as the 500,000-token bond for HIP-3 and HIP-4 deployers
21Shares (THYP)	US spot HYPE exchange-traded fund; 21Shares also listed a European ETP in 2025	Launched 12 May 2026, described as the first US spot HYPE ETF
Bitwise (BHYP)	US spot HYPE ETF on NYSE Arca	Launched the same week in May 2026
Grayscale	US HYPE fund that passes through staking rewards	Launched around early June 2026 (ticker reported as HYPG; a March filing used GHYP)
VanEck	Announced plans in 2025 for a US staking ETF and a European ETP	We could not confirm a US launch; treat as unverified

Artemis data cited by FalconX in May 2026 put treasury-company holdings at about 9.5% of HYPE supply, a higher share than comparable companies hold of bitcoin or ether. Treasury-company shares can trade well above or below the value of the tokens they hold and add their own risks.

Ecosystem: who actually uses it

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Users

Active traders

The core audience is experienced crypto traders, including large "whales" whose positions are publicly visible and widely followed. Hyperliquid was reported to hold roughly 69% of daily active users across decentralised perp venues in early 2026.

Users

Macro and commodity traders

Since HIP-3, people trade oil, gold, silver, stock indices and single stocks around the clock. During the 2026 Iran conflict, oil perps averaged more than $700 million a day in April, when conventional futures markets were closed at weekends. Real-world assets drove about a third of new users in early 2026.

Distribution

Wallets and apps

Phantom, MetaMask, Rabby and Coinbase's Base app embed Hyperliquid markets. In October 2026 the Bloomberg Terminal began showing Hyperliquid perp prices, a sign that professionals now treat it as a reference for round-the-clock pricing.

HyperEVM

Liquid staking

Kinetiq (kHYPE) and others issue tokens that represent staked HYPE and can be used elsewhere. This adds smart-contract risk on top of staking.

HyperEVM

Lending and credit

HyperLend, Felix and similar protocols let users borrow against HYPE, staked HYPE and Unit assets. Native borrowing on HyperCore arrived in 2026 through portfolio margin.

HyperCore

Tokenisation and spot

Unit brings BTC, ETH, SOL and other assets to spot order books. PURR, a cat-themed memecoin and the first HIP-1 token, and the Hypurr NFT collection are the community's mascots.

Why do transparent whales matter?The "public hunt" problem

Because every position is on-chain, anyone can see a large trader's size and approximate liquidation price. That transparency is a selling point: there is no hidden exchange-owned trading desk. It also invites other traders to push the price toward a visible liquidation level. Research firm 10x Research called this a "public hunt". The trader known as James Wynn lost roughly $100 million on leveraged bitcoin positions in May 2025 while the market watched in real time.

Institutions: what is and is not happeningETFs, Bloomberg, Coinbase, and the limits

By late 2026 there are US-listed HYPE funds, two listed treasury companies, a licensed S&P 500 perp and data on the Bloomberg Terminal. What is still missing for most regulated institutions is permission. Hyperliquid has no identity checks at protocol level and is not registered with US regulators, so many funds cannot touch the venue itself even if they can buy an ETF that holds its token.

Roadmap and what comes next

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Hyperliquid does not publish a dated roadmap. What follows is drawn from announcements and reporting up to October 2026, with an honest label on how firm each item is.

Item	What it means	How firm
A compliant US route	Bloomberg reported in August 2026 that Hyperliquid was in talks with Payward, Kraken's parent, about US access, reportedly via the CFTC-registered exchange Bitnomial. On 19 August 2026 President Trump said the CFTC under chairman Michael Selig was working to bring it onshore.	Talks reported; no approval, structure or date announced
Options	Yan said in October 2026 that options would be added so traders can hedge spot and perps on the same books.	Stated intention; no timeline
Permissionless HIP-4	Opening outcome markets to outside deployers.	Expected; not live as of mid-2026
More real-world assets	More equity, index, rate, volatility and pre-IPO perps from HIP-3 deployers.	Ongoing, driven by third parties
USDC yield sharing	Reserve income from Coinbase and Circle flowing to the protocol under AQAv2.	Announced May 2026; size depends on balances and interest rates
Decentralising validators and opening the code	A larger validator set, less foundation stake, and open-sourcing the node software, promised since early 2025.	Partly delivered (27 validators); code still closed as of mid-2026
Portfolio margin and borrowing	Wider access and more collateral types.	Rolling out in stages through 2026

What could go right

A legal US path would open the largest derivatives market in the world. Stock and commodity perps could keep growing beyond crypto's usual audience. Stablecoin yield would add a revenue line that does not depend on trading volume.

What could go wrong

Regulation could arrive as restriction instead of permission: CME and ICE lobbied Washington in May 2026 to bring Hyperliquid under CFTC oversight, citing oil-price manipulation risk. Compliance could require identity checks that change what the product is. Rivals could win share with cheaper fees. A serious technical failure or bridge loss remains possible. None of these outcomes is predictable, and this guide makes no forecast.

How Hyperliquid compares

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Three fair comparisons: against the centralised exchanges it challenges, against other decentralised perp venues, and against the general-purpose chains where rivals are built. Figures are as of the dates shown and change quickly.

	Hyperliquid	Binance	Bybit
Who holds your funds	You do, via your wallet; collateral sits in on-chain accounts	The exchange	The exchange
Identity checks	None at protocol level; front ends geo-block some countries	Required	Required
Transparency	Every order, position and liquidation is public	Internal ledger; proof-of-reserves snapshots	Internal ledger; proof-of-reserves snapshots
Scale	About 9% of global perp volume (June 2026, per Hyperliquid Strategies)	Largest perp venue by a wide margin	Among the top three
Base perp fees (taker / maker)	0.045% / 0.015%	About 0.05% / 0.02%	About 0.055% / 0.02%
Customer support and recourse	Essentially none; mistakes are final	Support desk; regulated in some jurisdictions	Support desk; hacked for about $1.5B in Feb 2025 and covered losses
Main trust risk	Small validator set, bridge and code risk, emergency governance	Custody and counterparty risk; regulatory actions	Custody and counterparty risk
Fiat on-ramp	No; you arrive with crypto	Yes	Yes

	Hyperliquid	Aster	Lighter	edgeX	dYdX	GMX
Architecture	Own layer-1, on-chain order book	Multi-chain (BNB Chain and others); planned own chain	Zero-knowledge rollup, order book	StarkEx-based ZK rollup, order book	Own Cosmos chain, order book	Pooled liquidity on Arbitrum and Avalanche, oracle-priced
Origin	Self-funded, 2023	Merger of Astherus and APX; backed by YZi Labs; token Sept 2025	Venture-backed; token (LIT) launched 30 Dec 2025	Incubated by Amber Group	Venture-backed, 2019; moved to own chain 2023	Community launch, 2021
Fees	0.045% / 0.015% base	Low, with heavy incentives	Zero for standard retail accounts	Low maker/taker	Maker/taker tiers	Open/close fees plus price impact
Open interest, 8 Sept 2026 (Artemis)	$14.6B	$2.5B	$1.1B	$0.6B	Each under about $0.2B
Notable for	Depth, HIP-3 real-world assets, buyback model	Very high leverage (up to 1001x advertised) and volume incentives	Cryptographic proof of fair matching	Multi-chain deposits	The original order-book perp DEX	Simple pool model for liquidity providers
Main criticism	Validator concentration; closed code	Questions about incentive-driven volume	Volume fell about threefold after its airdrop	Less transparent team	Lost share after 2023	Pool depositors bear trader profits; 2025 exploit of v1

	Hyperliquid (app-specific L1)	Solana venues (e.g. Drift, Jupiter Perps)	Ethereum L2 venues (e.g. Lighter, edgeX, GMX)
Design	One chain built for one exchange; other apps attach via HyperEVM	Exchange is one of thousands of apps sharing a general chain	Rollup or app on a rollup, settling to Ethereum
Speed for trading	Sub-second finality; no gas on orders	Fast and cheap, but shares capacity with all other activity	Fast matching off-chain or in a sequencer; proofs posted later
Security source	27 validators staking HYPE	Roughly 1,800 Solana validators	Ethereum, plus the rollup's own sequencer and prover
Who controls ordering	Hyperliquid validators	Solana block leaders	Usually a single sequencer run by the project
Trade-off	Best performance and integration, least decentralisation of the base layer	Bigger, older validator set; past network outages; less specialised	Inherits Ethereum settlement; sequencer centralisation and exit delays

Centralised-exchange fees are standard published base tiers and vary by region and VIP level. Competitor descriptions are simplified. Every venue in these tables offers leveraged products that carry the same core danger.

Wallets guide

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Hyperliquid has no usernames or passwords. Your wallet is your account, and whoever controls its recovery phrase controls the funds. Nobody can reset it for you.

BrowserMobileBuilt-in perps

MetaMask

The most widely used Ethereum wallet; connects directly to the Hyperliquid app.
Added in-wallet Hyperliquid perps in October 2025 via builder codes, with its own fee on top.
Add the HyperEVM network (chain ID 999) to hold HYPE there.

BrowserMobile

Rabby

Popular with active DeFi users for clear transaction previews and warnings.
Works with the Hyperliquid app and HyperEVM; also offers perps access inside the wallet.
Pairs with Ledger and other hardware devices.

BrowserMobileBuilt-in perps

Phantom

Originally a Solana wallet, now multi-chain.
Launched Hyperliquid-powered perps in July 2025, one of the first large builder-code integrations.
Convenient, which is also a reason to be careful: leverage is a tap away.

Hardware

Ledger

Keeps keys offline on a physical device; you confirm actions on its screen.
Use it through MetaMask or Rabby to sign in to Hyperliquid. Trading then uses an agent wallet, while withdrawals need the device.
Best suited to holding and staking larger amounts.

Hardware

Trezor and other hardware wallets

Same principle as Ledger: keys stay on the device.
Connect through a compatible browser wallet.
Check current support for HyperEVM before sending funds.

Embedded wallet

Hyperliquid email login

Sign in with an email address; a wallet is created for you behind the scenes.
Lowest friction for beginners, but security depends on your email account.
Consider it for small amounts only.

BrowserMobile

OKX Wallet

Multi-chain wallet from the exchange; supports HyperEVM and connects to the app.
Separate from an OKX exchange account: you hold the keys.
Offers built-in swaps and bridging.

MobileBuilt-in perps

Coinbase Wallet / Base app

Coinbase's self-custody app. In August 2026 Coinbase said it would route perps trading through Hyperliquid markets.
Availability depends on your country.
A separate product from a Coinbase exchange account.

MobileThird-party apps

Based, Dexari and other mobile front ends

Independent apps that trade on Hyperliquid through builder codes and add a fee.
Quality and security vary; check who built the app and what it asks you to sign.
They can trade your account once approved but should never be able to withdraw.

How signing works on Hyperliquid

You approve a one-time signature to create an agent (API) wallet that can place trades for your account but cannot withdraw. Day-to-day orders are signed by that agent in your browser, which is why trading needs no pop-ups. Withdrawals and transfers still need your main wallet's signature.

Safety basics

Type the address app.hyperliquid.xyz yourself or use a bookmark. Fake sites in search adverts are the most common way people lose funds.
Never enter a recovery phrase into a website, and never share it with "support".
Hyperliquid also offers email login through an embedded wallet. It is convenient, but a hardware wallet protects larger balances better.
Read every signature request. An agent approval for an app you do not recognise can let it trade your account.

Getting started safely, and where to buy HYPE

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This section describes mechanics, not a recommendation. If you only want to hold HYPE you never need to open a leveraged position, and nothing here should be read as encouragement to do so.

Route A: buy on a centralised exchange

The simplest path for most people. HYPE was absent from the largest exchanges for much of its first year. It is now listed on many well-known venues, for example Bybit, KuCoin and Bitget, with others added since. Listings vary by country, so check what is available where you live.

Open and verify an account
Use a regulated exchange that serves your country. Turn on app-based two-factor authentication.
Fund it and buy HYPE on the spot market
Choose the spot market. Avoid anything labelled futures, perps or margin.
Decide where to keep it
Leaving it on the exchange is simple but means trusting the exchange. Withdrawing to your own wallet means choosing the right network, either HyperEVM or HyperCore as the exchange supports, and sending a small test first.

Route C: regulated funds

In the US, spot HYPE ETFs from 21Shares, Bitwise and Grayscale have traded since May–June 2026 through ordinary brokerage accounts. They charge annual fees, trade only in market hours and do not let you use the network. Europe has had exchange-traded products since 2025.

Route B: buy on Hyperliquid itself

Only for people comfortable with self-custody, and only where it is legal. The main interface blocks the United States and other restricted jurisdictions; do not use a VPN to get around this.

Set up a wallet
Install a wallet from section 12 and back up the recovery phrase on paper, offline.
Get USDC
Buy USDC on an exchange. Hyperliquid's deposit screen accepts USDC from Arbitrum and, through Circle's native integration, other supported networks. It also accepts BTC, ETH and SOL through Unit.
Deposit a small test amount
Go to app.hyperliquid.xyz, connect, choose Deposit and send a small amount first. Deposits usually arrive within a minute or so. The bridge has a minimum (5 USDC at the time of writing); smaller amounts are lost.
Move funds to your spot balance if needed
Perps and spot have historically been separate balances. Use the transfer button so you are buying on the spot side.
Buy HYPE on the spot order book
Open the Spot tab, pick HYPE/USDC and place a limit order near the current price. There is no leverage on a plain spot purchase and nothing can be liquidated.
Optional: stake
Staking moves HYPE from your spot balance to the staking balance and delegates it to a validator. Delegations lock for one day, and unstaking takes seven days to return. Rewards are modest, and your choice of validator matters for network decentralisation.

The perps tab is one click away. Think before you open it.

The interface defaults to perpetual futures, often with leverage pre-selected. A spot purchase and a 20x perp position can look similar on screen and behave completely differently. If you do not fully understand liquidation, funding and margin, do not open a perp. No trading tips are offered anywhere on this site.

Risks and criticisms

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Leveraged perpetuals are high-risk. Most retail traders lose.

Regulators that require brokers to publish client outcomes for comparable leveraged products consistently show that a clear majority of retail accounts lose money. On Hyperliquid there is no investor-protection scheme, no support desk to reverse a mistake and no cooling-off period. On 10 October 2025 more than $10 billion of positions were liquidated on Hyperliquid in a single day. Only ever risk money you could lose completely, and consider not trading leverage at all.

Trader risk · high

Liquidation and auto-deleveraging

Leverage turns ordinary price moves into total losses of margin. In extreme stress, ADL can also close profitable positions without consent, as on 10–11 October 2025, breaking hedges that traders believed were safe.

Structural · high

Validator concentration

Twenty-seven validators secure billions of dollars. Foundation-run validators held about 49% of stake in mid-2026, down from over 81% in January 2025 but well above the one-third level at which a single party could stall the chain. Solana has around 1,800 validators and Ethereum hundreds of thousands.

Structural · high

Closed-source core and a single client

The node software is not open source and there is only one implementation. Outsiders cannot fully audit it, and one bug affects every validator at once. Open-sourcing has been promised since early 2025.

Governance · high

Discretionary intervention

In the JELLY episode, validators delisted a market and set the settlement price within minutes. Supporters say this protected depositors. Critics, including Bitget's chief executive, said it showed the venue can act like a centralised exchange when it matters.

Market integrity · high

Manipulation of thin markets

Repeated episodes (JELLY, XPL, POPCAT, FARTCOIN, and an oracle print on SK Hynix) show that illiquid or newly listed markets can be pushed around, with losses landing on other traders or on HLP depositors. Other platforms that use Hyperliquid's prices can be hit too, as Papertrade found in October 2026.

Legal · high

Regulation

Hyperliquid is not registered with US, EU or Singaporean regulators. US users are blocked on the main interface. Outcomes range from a licensed US route to enforcement or forced restrictions. Using it may be unlawful where you live; check.

Custody · medium

Bridges and wrapped assets

USDC that arrived through the Arbitrum bridge depends on Hyperliquid's validators; Unit's BTC, ETH and SOL depend on its guardians. Native USDC has reduced, not removed, this exposure.

Token · medium

HYPE-specific risks

The price depends on fee revenue that fell by more than half between Q3 2025 and Q2 2026. Hundreds of millions of team tokens are vested and unsold. Treasury companies and ETFs hold large amounts and could become sellers. HYPE has fallen by more than half from a peak before.

Illicit use · medium

No identity checks

Pseudonymous access attracts scrutiny over sanctions evasion and insider trading. A December 2024 report that wallets linked to North Korean hackers had traded on the platform triggered record withdrawals, and a US congressional committee asked for records in September 2026.

Operational · medium

Outages and user error

A front-end and API disruption on 29 July 2025 lasted about half an hour and led to refunds. Self-custody mistakes, such as sending to the wrong network, signing a malicious approval or losing a phrase, are permanent.

Incident file

December 2024: the North Korea wallet scareRecord outflows on a security researcher's warning

MetaMask security researcher Taylor Monahan warned that addresses she linked to North Korean state hackers had been trading on Hyperliquid, and suggested they might be studying it. More than $250 million of USDC was reported to have left the platform in a day, a record at the time. Hyperliquid Labs said there had been no exploit and that user funds were accounted for. No theft occurred. The episode drew attention to the small validator set then guarding the bridge.

March 2025: the ETH whale and the JELLY squeezeTwo attacks on HLP in two weeks

On 12 March 2025 a trader built a highly leveraged long on roughly 175,000 ETH, withdrew margin and let the position be liquidated into HLP, which lost about $4 million. Hyperliquid cut maximum leverage on large positions.

On 26 March a trader shorted the small memecoin JELLY on Hyperliquid while buying it elsewhere, forcing the short into HLP as the price surged about 400%. HLP's unrealised loss was estimated at $12–13.5 million. Within minutes validators voted to delist the contract and settle at the attacker's entry price; HLP ended with a small profit and the foundation said it would make affected users whole. The loss was avoided, at a cost to the claim that nobody can intervene.

May 2025 onward: whales and "insider" suspicionsPublic positions, public questions

Because positions are public, well-timed trades become news. Several large shorts opened shortly before market-moving US policy announcements, most famously ahead of the tariff announcement that preceded the October 2025 crash, prompted accusations of trading on inside information. Nothing has been proven, and such trades are also visible on no other large venue simply because others do not publish them. In September 2026 the House Oversight Committee asked Hyperliquid how it identifies account holders and refers suspicious trades; a Labs spokesperson said the company was reviewing the request.

August 2025: the XPL pre-market squeezeThin book, tens of millions lost

On 26 August 2025 large buyers pushed the price of XPL, a token trading in a "pre-launch" perp market, up about 200% in minutes, liquidating short sellers for losses in the tens of millions of dollars. Hyperliquid said the system worked as designed and later added safeguards for pre-launch markets.

10–11 October 2025: the liquidation cascadeThe largest wipe-out in crypto history

A US tariff announcement triggered a market-wide crash. About $19 billion of leveraged positions were liquidated across exchanges in 24 hours, with more than $10 billion of that on Hyperliquid, whose open interest fell from $14.7 billion to $6.5 billion in a day. The chain stayed online and reported no bad debt; HLP earned an estimated $40 million. But cross-margin ADL triggered for the first time, closing profitable positions, and many traders who thought they were hedged were not. Open interest took eleven months to return to its pre-crash level.

November 2025: POPCATAn attacker burns $3M to cost HLP $4.9M

On 12 November 2025 a trader split funds across many wallets, built leveraged POPCAT longs, propped the price with a large bid and then pulled it, leaving HLP with about $4.9 million of bad debt. Hyperliquid briefly paused its Arbitrum bridge. The attacker appears to have lost money too, which suggests the aim was to damage the vault.

2026: FARTCOIN, SK Hynix and PapertradeThe pattern continues, at the edges

9 April 2026: four wallets built about $15 million of FARTCOIN longs, triggered ADL in a thin market and left HLP roughly $1.5 million down, according to PeckShield.

27 July 2026: a single erroneous trade on a Korean alternative exchange fed into Trade[XYZ]'s SK Hynix perp oracle. The mark fell about 18%, roughly 960 accounts lost about $57 million of longs, and the deployer said it would cover losses as a one-off. Hyperliquid's chain was not at fault, but HIP-3 markets are only as robust as their deployer's oracle.

11 October 2026: a trader made about $1.28 million from a separate exchange, Papertrade, which priced off Hyperliquid's ETH order book, by moving that book. Hyperliquid itself was not breached.

The centralisation debate in one placeThe validator letter, Gracy Chen, CZ and the reply

In January 2025 a staking-firm employee published a letter criticising closed code, lack of documentation and foundation control of more than 81% of stake. Hyperliquid replied that it would open the code once stable and broaden the set, and it did move to 21 permissionless validators in April 2025 and 27 by June 2026. In April 2026 Bitget's Gracy Chen again called it effectively centralised, and in June 2026 Binance's founder CZ questioned its decentralisation while praising its product. A July 2026 governance review by crypto.news concluded that progress was real but incomplete.

Myths vs facts

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Myth

“Hyperliquid is just a faster website for trading crypto.”

Fact

It is a separate layer-1 blockchain. The order book, margin and liquidations are chain logic executed by validators, and every action is publicly recorded.

Myth

“It's fully decentralised, so nobody can interfere.”

Fact

Twenty-seven validators run it, the foundation's validators held about 49% of stake in mid-2026, and validators have delisted a market and set a settlement price in an emergency. It is non-custodial and transparent, which is different from being beyond intervention.

Myth

“No VC means no insiders.”

Fact

There were no outside investors, but core contributors received 23.8% of supply and the foundation controls further reserves. Concentration exists; it sits with the team.

Myth

“The buyback means the HYPE price can only go up.”

Fact

Buybacks are funded by fees, and fees fall when trading slows. Quarterly revenue more than halved between Q3 2025 and Q2 2026. HYPE has fallen by more than half from a peak before.

Myth

“HLP is a safe yield vault.”

Fact

HLP is a trading strategy and the liquidator of last resort. It has made money overall, but has taken multi-million-dollar hits from deliberate attacks, and its returns are irregular.

Myth

“Higher leverage just means bigger profits.”

Fact

Leverage shrinks the price move needed to wipe you out. At 40x, a move of roughly 1.3% against you ends the position. Fees and funding are charged on the full position as well.

Myth

“Anyone anywhere can use it legally.”

Fact

The main interface blocks the United States and other restricted jurisdictions. Singapore's regulator placed it on an alert list in 2026. Whether you may use it depends on where you live.

Myth

“The whole supply unlocks at 10 million HYPE a month.”

Fact

That is the modelled vesting schedule. Announced team distributions have mostly been a small fraction of it, though the vested, undistributed balance is a real overhang.

Myth

“USDH is Hyperliquid's stablecoin.”

Fact

It was, briefly. Native Markets won the ticker in September 2025, but in May 2026 the arrangement was replaced by a USDC deal with Coinbase and Circle, and USDH was wound down.

Myth

“If the chain stayed up, nobody was harmed in October 2025.”

Fact

The chain did stay up and reported no bad debt. But over $10 billion of positions were liquidated there, and auto-deleveraging closed profitable positions without consent.

Glossary

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Search 45 terms

ADL (auto-deleveraging): A last-resort mechanism that closes profitable positions on the opposite side when liquidations and the HLP backstop cannot cover a loss.
Agent wallet: A key approved by your main wallet that can place trades for you but cannot withdraw funds. Also called an API wallet.
Aligned quote asset (AQA): A stablecoin whose issuer meets protocol conditions, such as sharing reserve yield, in return for a privileged role as collateral or quote currency.
Ask: The price a seller is willing to accept. The lowest ask is the best ask.
Assistance Fund: The keyless on-chain address that receives most trading fees and automatically buys HYPE, which is then burned.
Bid: The price a buyer is willing to pay. The highest bid is the best bid.
Bridge: A mechanism for moving assets between blockchains. Hyperliquid's original USDC bridge is on Arbitrum.
Builder code: An identifier that lets a third-party app route orders to Hyperliquid and charge an approved extra fee.
Burn: Permanently removing tokens from supply.
CCTP: Circle's Cross-Chain Transfer Protocol, which moves native USDC between chains by burning on one and minting on another.
CLOB: Central limit order book: a list of bids and asks matched by price, then time.
Cross margin: A mode in which your whole account balance backs all positions together.
Delegation: Assigning your staked HYPE to a validator, who votes and earns rewards on your behalf.
Funding rate: A periodic payment between longs and shorts that keeps a perp's price near the spot price. Hourly on Hyperliquid.
Growth mode: A HIP-3 setting that cuts protocol fees by 90% on new markets to help them attract volume.
HIP: Hyperliquid Improvement Proposal. HIP-1 covers native tokens, HIP-2 automated liquidity, HIP-3 builder-deployed perps and HIP-4 outcome markets.
HLP: Hyperliquidity Provider, the community vault that market-makes and backstops liquidations.
HyperBFT: Hyperliquid's proof-of-stake consensus protocol, derived from the HotStuff family.
HyperCore: The native exchange layer: order books, margin, liquidations, vaults and staking.
HyperEVM: The Ethereum-compatible smart-contract environment on Hyperliquid, with HYPE as gas.
Initial margin: The collateral required to open a position: position size divided by leverage.
Isolated margin: A mode in which a position's possible loss is limited to the margin assigned to it.
Leverage: Position size divided by your margin. It multiplies gains and losses equally.
Liquid staking token: A token, such as kHYPE, that represents staked HYPE and can be used in other applications.
Liquidation: Forced closure of a position when its margin falls to the maintenance level.
Long: A position that profits when the price rises.
Maintenance margin: The minimum collateral needed to keep a position open. On Hyperliquid it is half the initial margin at maximum leverage.
Maker: A trader whose order rests on the book and adds liquidity. Pays lower fees.
Mark price: The reference price used for margin and liquidations, blending oracle and order-book data.
Open interest: The total value of positions currently open. A better measure of real activity than volume.
Oracle: A feed that brings outside prices on-chain. Hyperliquid validators publish oracle prices for core markets; HIP-3 deployers choose their own.
Outcome market: A fully collateralised contract that pays a fixed amount depending on an event (HIP-4).
Perpetual future (perp): A derivative that tracks an asset's price with no expiry date.
Portfolio margin: A system that calculates margin across spot and perp positions together, allowing borrowing against eligible collateral.
Priority fee: An optional HYPE payment, burned by the protocol, for faster order placement.
Short: A position that profits when the price falls.
Slippage: The difference between the price you expected and the average price you got, caused by a large order walking the book.
Spot: Buying or selling the actual asset for immediate settlement, with no leverage.
Spread: The gap between the best bid and the best ask.
Staking: Locking HYPE to help secure the network in return for rewards.
Taker: A trader whose order fills immediately against resting orders. Pays higher fees.
Unit: The tokenisation layer that brings BTC, ETH, SOL and other assets to Hyperliquid spot markets.
USDH: The Hyperliquid-native stablecoin ticker won by Native Markets in 2025 and wound down in 2026.
Validator: A node operator that stakes HYPE, proposes and votes on blocks, and takes part in governance votes.
Vault: An on-chain account that trades pooled deposits under a leader's strategy. HLP is the protocol's own vault.

Test yourself

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Twelve questions with explanations. Your best score is remembered on this device.

Frequently asked questions

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What is Hyperliquid in simple terms?

Hyperliquid is a blockchain designed to run an exchange. Its order books for perpetual futures and spot trading operate directly on-chain, and users trade from their own wallets instead of depositing money with a company.

Who created Hyperliquid?

Jeff Yan, a Harvard graduate and former Hudson River Trading engineer, co-founded it with a pseudonymous Harvard classmate known as iliensinc. The developer, Hyperliquid Labs, has about a dozen staff and has never raised venture capital.

What is the HYPE token used for?

HYPE is staked to secure the network, pays gas on HyperEVM, gives trading-fee discounts, serves as the 500,000-token bond for deploying new markets and carries stake-weighted voting power. Most trading fees are used to buy HYPE and burn it.

How many HYPE tokens are there?

One billion were created at genesis in November 2024, and that is the maximum. Burns have reduced total supply since; trackers showed about 962 million in April 2026. Circulating supply is far lower, roughly 225 to 260 million depending on the tracker.

Is Hyperliquid decentralised?

Partly. It is non-custodial and fully transparent, but it is secured by 27 validators, foundation-run validators held about 49% of stake in mid-2026, and the node software is closed-source. Validators have intervened in markets in emergencies.

Can people in the United States use Hyperliquid?

The main interface blocks US users, and Hyperliquid is not registered with US regulators. In August 2026 President Trump said the CFTC was working on a compliant route and talks with Kraken's parent were reported, but nothing had been approved as of October 2026. US investors can buy spot HYPE ETFs through brokers.

Is Hyperliquid safe?

No trading venue is safe in an absolute sense. Hyperliquid has not lost user deposits to a hack, but it carries validator, bridge and software risk, and its markets have been manipulated several times. The largest danger for individuals is leverage itself.

What are perpetual futures?

Contracts that track an asset's price without expiring. Traders post collateral and often use leverage. A funding payment between longs and shorts keeps the contract price near the real price. They are high-risk, and most retail traders lose money on them.

What happened on 10 October 2025?

A market-wide crash liquidated about $19 billion of leveraged positions in a day, more than $10 billion of it on Hyperliquid. The chain stayed online with no bad debt, but auto-deleveraging closed some profitable positions and open interest more than halved.

What was the JELLY incident?

In March 2025 a trader manipulated a small memecoin market so that a losing short position was dumped onto the HLP vault. Validators delisted the market and settled it at a protective price. The vault was saved, and critics said the response showed centralised control.

What is the Assistance Fund?

An on-chain address with no private key that receives most of Hyperliquid's trading fees and automatically buys HYPE. Following a December 2025 validator vote, tokens it holds are treated as burned and purchases are now burned automatically.

What happened to USDH?

Native Markets won a validator vote for the USDH stablecoin ticker in September 2025. In May 2026 Coinbase and Circle agreed to share about 90% of USDC reserve yield with the protocol, Native Markets sold the USDH brand to Coinbase, and USDH was wound down with one-for-one redemption into USDC.

Where can I buy HYPE?

On many centralised exchanges, on Hyperliquid's own spot order book if it is legal where you live, or indirectly through US spot ETFs and European exchange-traded products. This is a description of options and not a recommendation to buy.

Do I need to use leverage to use Hyperliquid?

No. Spot purchases, staking and HyperEVM applications involve no leverage. The interface defaults to perpetual futures, so check which tab you are on.

Is there a HYPE ETF?

Yes. 21Shares launched the first US spot HYPE ETF on 12 May 2026, Bitwise followed the same week, and Grayscale launched a fund with staking in early June 2026.

How does Hyperliquid make money?

The protocol charges trading fees, and from 2026 also receives a share of USDC reserve income. The developer company does not take these fees; they go to the HLP vault, market deployers and, mostly, to buying and burning HYPE.

Sources and further reading

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Facts were checked in October 2026 against the sources below. Where sources disagreed we give a range or say so. Primary documentation comes first.

Related guides

Hyperliquid Unpacked is part of a family of independent, plain-English guides. These are the ones that bear most directly on Hyperliquid.

The Coin GalaxyPart of The Coin Galaxy: browse every guide in the seriesthecoingalaxy.com What is Ethena?Ethena bid for the USDH stablecoin ticker, and its USDe is widely used as perp collateral.whatisethena.com What is Aave?Aave is the lending blueprint that HyperEVM markets such as HyperLend and Felix follow.whatisaave.com Ethereum UnpackedHyperEVM runs Ethereum-style smart contracts, and Hyperliquid's first USDC bridge sits on an Ethereum rollup.ethereumunpacked.com What is Solana?Solana venues such as Drift and Jupiter Perps are Hyperliquid's closest on-chain rivals.whatssolana.com

What is Hyperliquid? Unpacked.

Your learning path

From Chameleon Trading to an exchange

Writing a chain in three months

HyperBFT: agreeing on order

HyperCore: the exchange

HyperEVM: everything else

Order books versus pools

Place an order and watch it match

Perpetual futures for beginners

Funding: the price of keeping a perp in line

Beyond perps: the rest of the system

What HYPE is used for

Team unlocks: schedule versus reality

The Assistance Fund: fees in, HYPE out

USDH: the stablecoin contest and its short life

What it costs to trade

Revenue, by date

How the market share has moved

Jeff Yan

"iliensinc"

Hyperliquid Labs

Hyper Foundation

Hyperliquid Policy Center

The validator set

Deployers and front ends

Treasury companies and funds that hold HYPE

Active traders

Macro and commodity traders

Wallets and apps

Liquid staking

Lending and credit

Tokenisation and spot

MetaMask

Rabby

Phantom

Ledger

Trezor and other hardware wallets

Hyperliquid email login

OKX Wallet

Coinbase Wallet / Base app

Based, Dexari and other mobile front ends

Route A: buy on a centralised exchange

Open and verify an account

Fund it and buy HYPE on the spot market

Decide where to keep it

Route B: buy on Hyperliquid itself

Set up a wallet

Get USDC

Deposit a small test amount

Move funds to your spot balance if needed

Buy HYPE on the spot order book

Optional: stake

The perps tab is one click away. Think before you open it.

Leveraged perpetuals are high-risk. Most retail traders lose.

Liquidation and auto-deleveraging

Validator concentration

Closed-source core and a single client

Discretionary intervention

Manipulation of thin markets

Regulation

Bridges and wrapped assets

HYPE-specific risks

No identity checks

Outages and user error

Incident file

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