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Hyperliquid Review

Hyperliquid Review

Understand how Hyperliquid became the top decentralized exchange, surpassing dYdX as the most popular futures platform in DeFi.

Summary: Hyperliquid has surpassed dYdX to become the leading decentralized exchange, leveraging its advanced Hyperliquid L1 blockchain for rapid on-chain transactions. It supports over 122 cryptocurrencies, including major assets and altcoins, and offers up to 50x leverage, making crypto trading accessible to its growing community of over 150,000 users.

Hyperliquid's user-focused features, such as self-custody, one-click trading, and Hyperliquid Vaults for copy trading, are complemented by a transparent fee model that returns value to users for providing liquidity.

Hyperliquid Overview
5.0 out of 5.0 by Datawallet
Hyperliquid is a leading decentralized futures exchange known for its high trading volume, operating on its own L1 blockchain to offer fast, transparent, and efficient cryptocurrency trading.
Daily Traded Volume
Averages over $1 Billion in 24 hour volume.
Supported Assets
BTC, ETH, SOL, TIA, INJ, SEI, SUI & 110 more.
Key Features
Zero gas fees, 50x leverage and fully on-chain.

Get started with Hyperliquid and get an additional 5% off trading fees.

Content Guide
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What is Hyperliquid?

Hyperliquid is a decentralized perpetual futures exchange utilizing its proprietary Hyperliquid L1 blockchain for superior on-chain performance. With Tendermint for fast consensus, it enables swift and transparent execution of orders, cancellations, trades, and liquidations, supporting up to 20,000 orders per second with sub-second block times.

Surpassing dYdX, Hyperliquid leads in daily trading volume, handling over $1 billion and serving 150,000 users. It offers 122 cryptocurrencies, focusing on transparency, low fees, and user-friendly features like self-custody and one-click trading. Advanced tools, such as TradingView integration, provide a robust trading experience by merging centralized exchange efficiency with decentralized benefits.

What is Hyperliquid?

Supported Assets

Hyperliquid supports trading for over 122 cryptocurrencies, including major ones like BTC and ETH, as well as a diverse selection of altcoins such as AAVE, APE, ATOM, AVAX, BNB, DOT, LINK, MATIC, SOL, TIA, TRX, and XRP. This broad asset range ensures traders can access a wide variety of cryptocurrencies.

Leverage on Hyperliquid varies by cryptocurrency, offering tailored options to enhance trading flexibility. For major assets like BTC and ETH, leverage can go up to 50x. Many altcoins, including AAVE, APE, ATOM, and AVAX, provide up to 20x leverage. Other assets, such as ACE, BADGER, and BIGTIME, offer up to 10x leverage. Certain cryptocurrencies, including BANANA, CANTO, and CYBER, allow for up to 3x leverage. This leverage structure accommodates diverse risk profiles and trading strategies.

Hyperliquid Fees

Hyperliquid's fee system is designed to be user-friendly and transparent. Takers are charged 2.5 basis points (bps), while makers receive a rebate of 0.2 bps. This fee structure is based on a rolling 14-day trading volume, starting from February 26 and implemented from March 11.

The fee tiers are consistent across master and sub-accounts, with sub-account volumes contributing to the master account's total. Vault transaction volumes are evaluated separately. Initially, Hyperliquid provided a fee-free and gas-free trading environment during the first three months of its mainnet closed alpha, demonstrating its dedication to community value.

Hyperliquid Funding Rates

Hyperliquid employs funding rates for its crypto perpetual contracts to ensure the contract price closely tracks the underlying asset's spot price. Here's a simple overview:

  • Funding is calculated and paid hourly, based on an 8-hour rate.
  • The formula for funding rate is: Funding Rate (F) = Average Premium Index (P) + clamp (interest rate - Premium Index (P), -0.0005, 0.0005).
  • Oracle prices derive from the weighted median of centralized exchange (CEX) spot prices.
  • Funding rates are capped at a maximum of 4% per hour.
  • Payments are calculated using the position size, oracle price, and funding rate.

For example, if the perpetual contract price is $10,100 and the spot price is $10,000, this results in a 1% premium index. For a long position of 10 contracts (1 BTC each), the premium would be 0.01 or 1%. The clamped interest rate difference becomes -0.05%, leading to a funding rate of 0.97%.

Hyperliquid L1

Hyperliquid L1 is a blockchain designed to create a decentralized version of Binance for spot trading, alongside its perpetual futures platform. It features HIP-1 for deploying native tokens and on-chain spot order books, and HIP-2 for committing liquidity to these order books.

The first token launched was $PURR, with a fixed supply of 1 billion tokens—half distributed to points holders and half committed as Hyperliquidity. HIP-1 and HIP-2 will integrate into Hyperliquid's infrastructure, enhancing cross-chain functionality and expanding the platform's capabilities.

Hyperliquid L1

What are Hyperliquid Vaults?

Hyperliquid Vaults introduce an innovative take on copy trading, integrated with the Hyperliquid L1 blockchain, enhancing the platform's capabilities. By investing in a vault, users mimic its trades and earn from the profits and losses. The Hyperliquidity Provider (HLP) scheme democratizes access to opportunities usually reserved for exchange insiders, allowing the community to back liquidation or market-making strategies and share in the outcomes. 

With a total value locked (TVL) of over $150 million and an annual percentage rate (APR) of 81%, setting up a vault is simple. Users just need to name their vault, describe it, and initiate it with a minimum of 100 USDC to begin trading.

Hyperliquid Points and Airdrop

Hyperliquid's points program, which started on November 1 at 00:00 UTC, will lead to a governance token airdrop, rewarding users for their contributions. Key elements of this program include:

  • Weekly Distribution: For six months, Hyperliquid distributes 1,000,000 points weekly to active users, with the first distribution on November 9.
  • Affiliate Incentives: Affiliates earn one point for every four points their referrals gain, boosting community engagement.
  • Regular Updates: Point-earning criteria are updated regularly, with calculations based on activity up to each Wednesday at 00:00 UTC and distributions on Thursdays.
  • Protocol's Discretion: Hyperliquid can modify prior point distributions as needed.
  • Exclusive Snapshot for Alpha Users: An additional points drop snapshot was taken on October 31 at 00:00 UTC for closed alpha users.

This program not only rewards user engagement but also prepares for the governance token distribution, increasing user investment in Hyperliquid's future.

Bottom Line

Hyperliquid combines centralized exchange efficiency with on-chain transparency, offering advanced features, a broad asset range, and user-friendly fees. The Hyperliquid L1 blockchain and innovative HIP standards enhance its infrastructure, making it a leader in both perpetual futures and spot trading. Community initiatives like the airdrop program and Hyperliquid Vaults further engage users, solidifying Hyperliquid's role as a cutting-edge trading platform.

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