Crypto’s New Darling: Seriously?

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It appears a certain ‘Hyperliquid’ – a name redolent of anxieties regarding the modern condition, wouldn’t you agree? – has contrived to capture, in less than a year, a rather substantial slice of the perpetuals pie, nearly ten percent of both Bitcoin and Ether’s volume. One hears whispers that it has even begun to cast a shadow over the established Centralized Exchanges, those grey, monolithic structures of the financial world. Imagine! 🙄

And yet, despite this… *unmatched* growth (a word one encounters with irritating frequency these days), the token itself, HYPE – a name, frankly, begging for irony – languishes at a discount, a truly depressing one, to both Solana and Ethereum. One is compelled to ask, is this merely a temporary market eccentricity, or a profound commentary on the fickle nature of investor sentiment? The debates, naturally, are as plentiful as they are pointless.

HYPE: A Canine in the Wolf’s Clothing?

The gentlemen at “The DeFi Report” (who, one suspects, are rather heavily invested) declare that Hyperliquid took some $409 million in user fees these past six months, exceeding Ethereum by a flamboyant 23% and trouncing Solana by a more substantial 75%. However, HYPE itself trades at an 88% discount to Ether and a 62% discount to Solana, on a fully diluted basis. One is left to wonder if someone forgot to tell the market about these impressive figures. A most curious oversight, wouldn’t you say?

It’s admirable, in a thoroughly modern, somewhat cynical way, that Hyperliquid eschewed the usual venture capital courtship. No shadowy figures pulling strings from behind the scenes, no grasping hands seeking their pound of flesh. Instead, they gifted a significant portion of the token supply – 31%, no less, worth a princely sum at the outset – to early users. A clever maneuver, certainly, transforming traders into stakeholders and sidestepping the predictable avalanche of VC unlocks. A small triumph against the prevailing system, perhaps… or merely a different form of manipulation. 🧐

Furthermore, a foundation budget of 6% has been allocated to operational expenditures, and user fees are thoughtfully diverted to an ‘Assistance Fund’ that accumulates HYPE from the open market. This, it is claimed, reduces the circulating supply and somehow “supports price discovery.” The language of the modern financier is truly a marvel to behold, is it not? 😅

The core of Hyperliquid’s appeal, it seems, lies in its high-throughput, on-chain central limit order book, offering perpetuals and spot trading with the speed of a nervous telegraph operator and the fees of a moderately generous nobleman. It mimics the efficiency of a centralized exchange while, simultaneously, basking in the glow of DeFi’s supposed transparency. A fascinating paradox.

Trading activity, one is assured, is ‘at an all-time high.’ Daily volumes fluctuate between a respectable $10 and $20 billion, with open interest across assets reaching $13 billion. This bestows upon the platform a significant (9-11%) share of global Bitcoin and Ether perpetuals volume. In the last thirty days alone, they generated $107 million in fees, surpassing both Solana ($40 million) and Ethereum ($67 million). A resounding victory, unless, of course, one considers the continued discounting of the token…

A truly remarkable proportion of revenue is channeled into token buybacks. July alone witnessed $92.2 million in fees translate into $90.2 million of HYPE repurchases. The analysts speak glibly of a “buyback yield” accruing directly to holders, a novel concept that renders traditional fintech valuations – and the overflowing coffers of their executives – positively archaic.

Hyperliquid, ambitious creature that it is, has also begun to expand its horizons, venturing beyond the realm of perpetuals DEXs into the construction of its own Layer 1 ecosystem. Their ‘HyperEVM’ allows developers to construct upon the protocol’s liquidity without the onerous task of maintaining their own exchanges. Coupled with integrations across various digital wallets (Phantom, Rabby, Rainbow, one wonders if there will be a shortage of names ending in ‘by’) and ancillary services like Hyperlend and Unit Protocol, the platform seeks to weave an intricate web of network effects.

In terms of annualized volume, Hyperliquid has processed an astonishing $1.95 trillion, dwarfing its decentralized competitors. Its open interest in Bitcoin and Ether now represents 32% of CME’s and 7.6% of the total across both crypto-native exchanges and CME. Impressive, undeniably. Yet, one feels compelled to repeat the question: why, then, the discount? 🤔

Shadows and Uncertainties

Naturally, risks persist. The looming presence of established players like Coinbase and Robinhood, a somewhat precarious reliance on a limited validator set, and lingering questions regarding long-term sustainability, considering that a relatively small coterie of active traders generates the majority of revenue. These are matters that demand, if not outright concern, at least a degree of cautious observation.

Despite these caveats, analysts maintain that, given HYPE’s $48 billion fully diluted valuation and $16 billion circulating supply, its buyback-driven model and growing market penetration suggest the token remains, shall we say, *undervalued* in relation to Solana and Ethereum. One is left to wonder if the market simply suffers from a surfeit of optimism regarding the more established players, or a deep-seated distrust of anything new, anything… *hyperliquid*.

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2025-08-31 18:23