rewrite this title What Is Hyperliquid? The Decentralized Exchange With Its Own Blockchain – Decrypt

Decentralized perpetual futures exchange Hyperliquid has gone from being a market maker to one of the biggest crypto projects in the world.

Hyperliquid has processed trillions of dollars in volume in its lifespan and is now the third-largest decentralized exchange in crypto—trailing only industry veterans PancakeSwap and Uniswap.

It has been the talk of the town in 2025, but what exactly is Hyperliquid? Why do people care so much about it? And how did it grow to be one of the biggest projects in crypto?

What is Hyperliquid?

Hyperliquid is a decentralized exchange specializing in perpetual futures trading, built atop its own dedicated layer-1 network.

Its native token HYPE has been a roaring success, rising to become a top 20 cryptocurrency by market capitalization less than a year after launching.

Why do people care about Hyperliquid?

Put simply, Hyperliquid makes it easier for traders to speculate on the price fluctuations of cryptocurrencies, thanks to low fees, a large amount of available assets—and, of course, degenerate levels of leverage.

Fees on Hyperliquid range from 0.07% for low-volume taker spot trades, all the way down to 0% for high-volume perp maker fees, per the Hyperliquid docs. Taker traders are when liquidity is removed from the market, while makers add liquidity to the market. For comparison, Uniswap applies a 0.3% fee on trades.



Much like a centralized exchange, users can place trades on most of the major coins regardless of what chain they are on. Bitcoin, Ethereum, Dogecoin, TRUMP—all tradable in one place. Hyperliquid allows traders to use leverage of up to 40x. For comparison, the maximum leverage that Binance offers is 20x, and you have to meet certain requirements to access this tier.

As a result, it has become a battleground for degenerate wars between whales and the crypto community.

Notably, in March 2025, a whale opened a 40x leveraged short position worth $521 million against Bitcoin, which led to everyday traders teaming up in an attempt to liquidate the whale. Spectators were able to watch every movement on the Hyperliquid block explorer, which openly shows a wallet’s held positions, whether it’s in profit, and its liquidation price. The whale won in this instance, dumping the position for a $3.9 million profit.

All of these factors combined have led to Hyperliquid attracting over 700,000 total users since its 2023 launch and amassing a total volume of $2.7 trillion, according to its statistics dashboard.

Hyperliquid’s origin story

Hyperliquid was entirely self-funded and was built by a team of just 11 people, founder Jeff Yan told WuBlockchain in August 2025. He said the project rejected venture capital funding because it gives a fake sense of progression; instead, the team wanted to focus on “real progress” by giving value to users—not investors.

In 2020, Yan started to trade crypto and founded a market-making company, the earliest form of Hyperliquid. Two years later, he told the When Shift Happens podcast, its high-frequency market-making offering had effectively “capped out,” as he looked to grow the project.

That’s when Sam Bankman-Fried’s centralized exchange FTX imploded by using customer funds to cover losses at his trading firm Alameda Research. When a critical mass of users sought to withdraw their funds, their money wasn’t there, and the exchange was caught with its pants down. Bankman-Fried was found guilty on seven counts of fraud, money laundering, and conspiracy, resulting in a 25-year prison sentence.

“All of a sudden, people had a real reason not to trust centralized exchanges—and it wasn’t just mumbo jumbo intellectual stuff, they literally lost all this money, and it was because of centralized exchanges,” Yan told the podcast, calling it a “light bulb moment” indicating that the world was ready for decentralized finance.

The collapse of FTX, Yan said, was the catalyst that made Hyperliquid “go all in” on building a decentralized exchange.

In February 2023, Hyperliquid’s mainnet closed alpha went live. In its first five months, it claimed to have attracted 4,000 users, with 28 different assets available to trade. It hit full mainnet in August of that same year.

Hyperliquid experienced explosive growth following its $1.6 billion airdrop in November 2024—one of the biggest crypto airdrops of all time. Armed with goodwill among traders, Hyperliquid became the talk of the town going into 2025.

It hasn’t all been smooth sailing for the platform. In December 2024, Hyperliquid attracted unwanted attention from North Korean hackers snooping for vulnerabilities. A few months later, it faced a liquidation crisis and was forced to delist a Solana meme coin when a trader made a bet so bad that the Hyperliquid Foundation would’ve been forced to cover some losses.

The incident raised concerns around how the exchange handled heavily leveraged positions—with Gracy Chen, CEO of centralized exchange Bitget, claiming it could become “FTX 2.0.”

The future of Hyperliquid

Hyperliquid has proven to be relatively drama-free since these early growing pains, and has quickly established itself as a player in the crypto space.

As of this writing, according to DefiLlama, it has the eighth largest DeFi total value locked of any layer-1 network—ahead of chains like Aptos, Avalanche, and Linea. It also processes the third-highest monthly trading volume of any decentralized exchange, per DefiLlama.

With stablecoins becoming one of the dominant narratives in 2025, the question of whether Hyperliquid would issue its own stablecoin has inevitably been the subject of intense speculation.

Hyperliquid founder Yan said in the WuBlockchain interview that the Hyperliquid Foundation, the entity that supports the development of the Hyperliquid blockchain and its ecosystem, wouldn’t issue its own stablecoin.

However, in September 2025, the foundation opened submissions for teams to issue a “Hyperliquid-aligned” stablecoin, USDH. It attracted proposals from big-name players like Ethena, Paxos, and Sky, but ultimately went to a newly formed company in Native Markets. With USDH now live and trading, Hyperliquid now has a stablecoin that has dedicated half of its revenues to a protocol-driven buy back scheme.

Now, Hyperliquid faces direct competition from the emerging Aster decentralized exchange, which is offering higher levels of leverage and has the backing of Binance co-founder Changpeng “CZ” Zhao.

At the time of publication, Hyperliquid is ahead in terms of token valuation and trading volume—but how long will that last?