Hyperliquid presents itself as an order book-based perpetual futures-trading decentralized application (dApp). It was founded by Harvard grads Jeff and Iliensinc, who previously gained experience in high-frequency trading companies HRT and Citadel. The project launched its mainnet in June 2023. Within six months, it had achieved a total trading volume of $54 billion, with over $870 million in daily trading volume. The word of the platform’s capability to perform as well as a CEX, but to function as a fully decentralized, on-chain DEX spread quickly, and it started gaining over 1,000 new users per day. Hyperliquid is known for offering advanced orders, up to 50x leverage, access to 20+ underlying assets, copy trading, and more.
What are you risking?
TL;DR
The key risks associated with Hyperliquid include the potential for operational downtime due to its untested L1 blockchain, the possibility of price slippage due to low liquidity given its status as a new protocol, and vulnerabilities to market data integrity due to the reliance on potentially manipulable oracles
- Hyperliquid lists several risks in its documentation, the first of which is L1 risk. The project runs its own L1 which has not undergone extensive testing nd scrutiny, which may lead to occasional downtime.
- Market liquidity is also a risk, given that this is a relatively new protocol, which could encounter low liquidity, leading to potential price slippage.
- The project also mentions that it relies on price oracles maintained by validators to supply market data, which also leads to oracle manipulation risks, if the oracle is compromised or manipulated for an extended period.
What are the Benefits?
Of course there are advantages. For example, Hyper Liquid was custom-built to support 100% decentralized trading, and keep it fully transparent by conducting everything on-chain. Moreover, it displays high throughput and low latency. So, it was developed from scratch, with its code written in Rust for efficiency and robustness. It ensures security by using a similar governance model to other crypto platforms.
Hyperliquid is a decentralized perpetual exchange with best-in-class speed, liquidity, and price. Instant finality in <1 second. No more waiting for confirmations. No more MEV.
What do the social networks say?
jeff.hl on X explained how Hyperliquid’s liquidation flows:
A user called xulian praised platforms who decided to move into DeFi through Hyperliquid:
Content creator Parcifap explained why Hyperliquid is a gem:
So, social media and community feedback highlight Hyperliquid’s innovative approach to liquidation flows and its appeal as a bridge for traditional centralized exchange platforms moving into decentralized finance (DeFi). Given these insights, what are your thoughts on the potential impact of platforms like Hyperliquid on the future of decentralized trading?
