Forward the Original Title‘Hyperliquid：结合CEX与DeFi优势，打造高可用低延迟的交易平台’.

This week, the market continues to experience a downturn due to various factors, including a weakening U.S. stock market. It’s important to stay calm and focus on projects during such times. Today, Dr. DODO will introduce you to Hyperliquid, an application project launched in 2022 during the peak of Arbitrum’s popularity.

Hyperliquid

Hyperliquid is a high-performance L1 blockchain primarily created to support Hyper’s native Dex. Unlike traditional DEXs that rely on off-chain order books, Hyperliquid stores all key data states—including order books, margin, and trading matching engine states—directly on the blockchain. The design principle is completely decentralized. Theoretically, Hyperliquid supports up to 100,000 orders per second, with less than one-second block latency. It utilizes and improves upon the HyperBFT consensus algorithm, inspired by Hotstuff. The team optimized Hotstuff from the ground up, reducing the median end-to-end latency to 0.2 seconds.

Hyperliquid Dex

Hyperliquid Dex, the native application built on the Hyperliquid L1, is a decentralized exchange known for its exceptional speed, liquidity, and low fees. Currently focused on contract trading, it aims to offer users a seamless trading experience. The platform provides advanced trading features such as TWAP (Time-Weighted Average Price), scaled orders, and TP/SL (Take Profit/Stop Loss) orders, allowing traders to modify and cancel orders directly from TradingView charts.

Key Features:

Speed and Finality: Hyperliquid Dex promises instant trade execution in less than a second, eliminating the need for transaction confirmation and minimizing the risk of Miner Extractable Value (MEV).

On-Chain Transparency: With a fully on-chain order book, Hyperliquid Dex ensures that all transactions, funds, and liquidations are transparent and verifiable.

Cost-Effectiveness: Zero gas fees, maker rebates, and low trading fees lower the barrier to entry and offer favorable options for high-frequency trading.

Leverage: Users can trade with leverage up to 50x, enhancing capital efficiency.

User-Friendly: One-click trading without wallet authorization greatly simplifies the trading process.

HIP & Spot

HIP-1 is the native token standard Hyper developed for Spot trading, representing a significant innovation towards a high-performance native component infrastructure. Tokens adhering to this standard can easily establish on-chain spot order books on Hyperliquid Dex. HIP-2 is the spot liquidity for HIP-1 tokens, functioning similarly to liquidity pools in Uniswap’s AMM. It interacts with the native on-chain order book, offering users more complex and diverse order book liquidity. Compared to traditional AMMs, HLP’s existence allows for rapid liquidity provision during increased demand. HIP-2 also enables users to provide liquidity for a single trading pair on Hyper and earn spreads. The mechanism ensures a 0.3 spread every three seconds, incentivizing users to provide liquidity for trading pairs.

Gas Costs

Issuing HIP tokens on Hyper incurs gas costs. Since Hyper tokens are not yet listed, HIP token deployment and gas costs are paid in USDC. This cost is determined by a 31-hour Dutch auction, during which the cost linearly decreases to 100 USDC. Currently, gas fees are shared between HLP and stakers, but after the Hyper protocol token is launched, these fees will be paid to L1 validators as per the norm. To date, revenue from issuing fewer than 100 HIP tokens has exceeded one million dollars. This revenue is expected to become a significant portion of the Hyper team’s income, and the team will actively market this token standard to increase this revenue.

Market

Currently, there are four officially marked assets: $PURR, $HFUN, $POINTS, and $JEFF, with $PURR’s market cap peaking at nearly $150 million.

Vaults

Hyperliquid introduces Vaults as a form of copy trading. By depositing funds into a Vault, users can automatically replicate the Vault’s trades and share in the profits. Users can create their own Vaults, trade with others’ funds, and earn commission fees. This feature offers a straightforward trading strategy for those without extensive market knowledge, enabling them to participate in trading.

HLP

HLP is the official Vault endorsed by the Hyper protocol, currently responsible for providing liquidity and settlement for the Dex, democratizing Dex’s profit distribution. HLP allows community members to provide collateral for Hyper Vaults and share in the protocol’s profits. This feature aims to create a trading system that allows more ordinary users, beyond traditional market makers, to participate. Hyper previously separated liquidity provision and settlement into two Vaults. However, to improve the ROI performance of this Vault, the settlement has been merged into the market-making Vaults. As the official Vault of the Hyper protocol, it has performed exceptionally well, with a total PNL exceeding $30M to date. In the past month, the average APR has been as high as 31% (note that this APR represents the annual average return calculated in July, not the single-month return rate).

Points

Hyper’s first-phase points program ended on May 1, 2024. This program lasted six months, with 1,000,000 points distributed to users each week to reward users contributing to the Hyper protocol. Points were mainly earned by completing trades and holding positions in the Dex. The ongoing L1 phase points program began on May 29, 2024, and is scheduled to last four months.

Author’s Opinion

Overall, Hyperliquid aims to combine the strengths of centralized exchanges (CEX) with decentralized finance (DeFi) to provide a robust, transparent, and user-friendly trading platform. Since its launch on Arbitrum Goerli Testnet in 2022, Hyper has continuously developed, enriching its trading pairs and providing significant liquidity for many new assets. Technologically, Hyperliquid has accumulated considerable expertise, creating an L1 specifically for applications to balance the trade-off between speed and security, aligning with the trend of one application per chain for the future. In terms of user experience, trading is nearly imperceptible, with little difference from placing orders on traditional exchanges. The real-time accuracy of Oracle prices is also exceptionally high. In the current blockchain application space, calling it “highly available and low latency” is not an exaggeration. The recently tested spot trading is also a major highlight, combining the advantages of order book and AMM trading models, potentially exploring a promising new niche with the potential to replicate the meme rally pumped by Solana.

Disclaimer：

1. This article is reprinted from [PANews]. Forward the Original Title‘Hyperliquid：结合CEX与DeFi优势，打造高可用低延迟的交易平台’. All copyrights belong to the original author [DODOResearch]. If there are objections to this reprint, please contact the Gate Learn team, and they will handle it promptly.
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