Exploring Hyperliquid Comprehensively: Unraveling the HYPE and HLP Framework

In the ever-evolving world of cryptocurrency, one platform stands out for its rapid growth and innovative approach – Hyperliquid. This next-generation decentralized exchange (DEX) has captured the attention of investors and traders alike, thanks to its unique features and impressive performance.

Hyperliquid operates on its own custom Layer-1 blockchain, named Hyperliquid L1, designed for speed and scalability. Its technical architecture delivers up to 100,000-200,000 transactions/orders per second throughput, setting a new benchmark in the industry.

The heart of Hyperliquid's operations is its flagship product, the on-chain central limit order book (CLOB) for trading. This innovative system offers low slippage, precise pricing, advanced trading features, and transparency, rivaling centralized exchanges in execution quality. Slippage on big trades for top assets on Hyperliquid is often near 0%-0.01%.

The platform's native token, HYPE, was introduced via a historic airdrop on November 29, 2024, distributing 310 million tokens (31% of the total supply) directly to over approximately 90,000 early users. Since its debut at around $3.90 in November 2024, HYPE has climbed steadily, trading at approximately $36.12 by June 28, 2025, an increase of over 1,000% in just seven months.

Hyperliquid's unique hybrid architecture sets it apart from other DEXs. It employs a Layer-1.5 or L3 model, with the L1 running its own validator set (currently ~16 validators) and posting state proofs to Arbitrum. This structure allows for increased efficiency and scalability without compromising on security.

Users who deposit USDC into the HLP vault earn a share of the platform's revenue and PnL, with reported yields up to ~17% APY. The HLP vault, a protocol-managed liquidity pool, actively makes markets and backstops trades, ensuring liquidity and stability.

Hyperliquid's support for perpetual futures trading with leverage up to 50× on certain pairs, settled in USDC, and its real-time on-chain funding rates and swift liquidations, further enhance its appeal to traders.

As of early 2025, Hyperliquid commanded roughly 70% of the entire decentralized perps market volume. It processed over $18 billion in trading volume on peak days, more than 10 times its closest on-chain competitors. The spot exchange on Hyperliquid handled ~$200-300M in daily spot volume by early 2025, ranking among the top 10 DEXes by volume at one point.

The foundation of Hyperliquid Labs, the company that developed this groundbreaking platform, is Nihkil Gupta. Hyperliquid's technical architecture also includes HyperCore, which handles the order-book, trade matching, perpetual futures logic, and spot exchange at the protocol level for maximum efficiency, and HyperEVM, an EVM-compatible smart contract layer integrated into Layer 1 blockchain, allowing developers to deploy general-purpose dApps and smart contracts.

Hyperliquid's proprietary HyperBFT consensus mechanism, a proof-of-stake mechanism optimized for high throughput and low latency, enables sub-second block times and one-block finality, further enhancing its appeal to users seeking fast and reliable transactions.

In conclusion, Hyperliquid's unique features, impressive growth, and innovative approach have positioned it as a leader in the decentralized trading space. With its robust infrastructure, attractive yields, and high liquidity, it is no wonder that investors and traders alike are flocking to this platform.