Hyperliquid: The great cryptocurrency project of 2025

Source: PortaldoBitcoin Original Title: Hyperliquid: The Great Cryptocurrency Project of 2025 Original Link:

Hyperliquid: The Great Cryptocurrency Project of 2025

Jeff Yan had just witnessed the collapse of Sam Bankman-Fried’s crypto empire in a matter of days, in 2022. It was then, amidst the chaos of the FTX collapse and the contagion that followed, that Yan decided to bet everything on building his own cryptocurrency exchange — a decentralized alternative called Hyperliquid.

Now, three years later, Yan seems to have been rewarded. After co-founding Hyperliquid Labs in 2023, Yan helped develop one of the most impactful decentralized exchanges and layer-one networks in the 16-year history of cryptocurrencies — all without venture capital funding.

This year, Hyperliquid generated over US$ 2.73 trillion in perpetual futures trading volume, US$ 110.65 billion in spot trading volume, and achieved an annualized revenue of US$ 1.22 billion. To put this into perspective, the American audio company Dolby earned US$ 1.35 billion this year and employs more than 2,000 people. Hyperliquid Labs is a team of just 11 people, and Hyperliquid users share in the company’s revenue.

The Impact of Perpetual Contracts

Beyond the numbers, Hyperliquid’s impact on the industry can also be measured by how it helped popularize perpetual futures contracts, also known as perps, among native crypto traders. Perps allow traders to speculate on asset prices using derivative contracts that never expire, utilizing borrowed capital with different levels of leverage. This advanced trading tool was previously much less accessible, mainly available to accredited investors or traders on some centralized exchanges.

Hyperliquid changed that, lowering the barrier to entry like never before and forcing competing exchanges to offer increasingly risky leverage options. As a result, Hyperliquid helped create a new class of crypto companies known as perpetual DEXs — short for decentralized exchanges specialized in perpetual futures contracts.

The Rise of the Perpetual DEX

To understand Hyperliquid, first it’s necessary to understand perpetual futures. Initially theorized by economist Robert Shiller in 1993, perpetual futures allow traders to speculate on the direction of an asset through a (“long”) or (“short”) position. These are derivative contracts, meaning the trader does not technically own the underlying asset but holds a position in a contract that tracks its price.

Perpetual contracts, unlike traditional futures contracts, have no expiration date. This makes them useful for traders or market makers to hedge their bets indefinitely without worrying about contract expiry.

However, perpetual futures are often combined with dizzying levels of leverage. To open a leveraged position, users must deposit margin, which will be lost if the position is liquidated. Hyperliquid offers leverage from 3x to 40x, meaning traders can borrow up to 40 times the value of the margin provided and use that amount to multiply their gains — or losses.

In comparison, centralized exchanges offer much higher leverage, up to 150x, but require many steps, such as knowledge questionnaires, KYC (Know Your Customer) forms, risk assessments, and more.

Currently, there are over 100 tokens tradable as perps on Hyperliquid, from established digital assets like Bitcoin to highly volatile altcoins.

The Phenomenon of Financial Nihilism

To its critics, Hyperliquid is the latest high-powered financial tool designed for the digital era of financial nihilism — a mindset where the financial system is recognized as meaningless. Dr. Amin Samman, senior academic in international political economy at City, University of London, described the situation: “What we have is a kind of growing bubble, like a simulated carnival built inside the financial void — the void, the lack of foundation of finance itself, which cannot be avoided.”

One of the main factors behind Hyperliquid’s success is that it operates on its own dedicated layer-one blockchain, where its order book is settled — meaning each transaction is executed on-chain. This is how the DEX can offer gas-free transactions, account abstraction, ultra-fast settlement times, and other user-specific benefits.

However, Hyperliquid also remains accessible to retail traders, with an intuitive user interface, easy onboarding process, and low entry barriers. By catering to this casual audience, it sells the dream of “get rich or die trying.”

Extreme Gains and Losses

The idea is not unfounded; some people on Hyperliquid really do win — and big. Until November, one trader made over US$ 108 million, mainly from shorting Ethereum; another made US$ 27 million from shorting the native token; and a third earned US$ 29 million from shorting Bitcoin.

But when people lose, they lose badly. Like when a crypto influencer had their positions liquidated, totaling US$ 100 million.

In the past, such large-profit operations would be conducted behind closed doors, on a centralized exchange where transactions are not visible to the public. But every operation on Hyperliquid is publicly available through block explorers. This is how crypto traders try to hunt for so-called whales on the platform — large investors making multimillion-dollar positions.

Competition Between CEX and DEX

Expanding financial access is essential to the crypto vision of creating a new, borderless, permissionless money. With Bitcoin and stablecoins already present in nearly every corner of the world, many now aim to disseminate advanced trading tools. This partly explains why users have migrated from centralized exchanges to more decentralized alternatives.

To access cryptocurrencies and high leverage levels on centralized exchanges, users must meet various requirements and may have their accounts restricted. They also need to create accounts using their names, emails, physical addresses, and other personally identifiable information. On Hyperliquid, none of that applies — just connect a crypto wallet, deposit funds, and place a bet.

It is this fierce competition for users that has led exchanges to improve their leverage offerings, reduce margin requirements, increase liquidation limits, and much more. For example, some competing exchanges offer leverage of up to 1001x on selected assets.

Anyone in the crypto market unfamiliar with leverage received an intensive lesson in October, when US$ 19 billion in leveraged positions were liquidated across the entire crypto market — the largest liquidation event in crypto history. Many analysts believe this cascade of liquidations was caused by excessive leverage in the market.

Questions About Decentralization

While Hyperliquid is gaining popularity, some observers have expressed skepticism about its decentralization. Much of this distrust arose in March, when Hyperliquid removed a cryptocurrency from the platform after a user made such a disastrous trade that the platform had to take over the position to avoid a liquidation crisis. Although Hyperliquid stated that the removal was a collective decision made by the network’s validator group, industry observers suggested it shows the network is less decentralized than its advocates claim.

Similar concerns emerged in September, when a dispute arose over launching a “Hyperliquid-prioritized” stablecoin. Some community members alleged foul play, pointing out that the Hyperliquid Foundation controls most of the tokens in staking and could therefore influence the voting outcome.

After all, in the world of cryptocurrencies and other sectors, decentralization can be seen as a spectrum — and regardless of controversies, Hyperliquid is indeed more decentralized than traditional centralized exchanges.

After the FTX collapse, this distinction became a key differentiator. Suddenly, people had a real reason not to trust centralized exchanges — they literally lost all that money, and it was because of them. This revealed that the world was ready for decentralized finance.

The numbers clearly show that Hyperliquid has met a demand from native crypto traders. What happens next could reveal whether the public is truly ready for the world that decentralized finance is creating.