Hyperliquid: what it is, how it works and who runs it

What Hyperliquid is

Hyperliquid is a layer-one blockchain built around a trading venue. Its documentation splits the chain into two parts that share one consensus process, HyperBFT, a design derived from the HotStuff family of algorithms:

• HyperCore holds the margin system and the order books for perpetual futures and spot trading. Every order, cancel, trade and liquidation is processed onchain with one-block finality, and the docs give current capacity as about 200,000 orders per second.
• HyperEVM is an Ethereum-compatible smart contract environment on the same chain. Contracts on it can read HyperCore prices and, through system contracts, place orders on its books. The docs still describe the HyperEVM as being in an alpha stage.

So when people search for the "Hyperliquid exchange" or "Hyperliquid DEX", they usually mean HyperCore's order books reached through a front end such as app.hyperliquid.xyz. It is an order-book exchange, with resting limit orders matched by price and time, not a pool that quotes prices from a formula.

Who runs Hyperliquid

Several parties are involved, and they have different roles.

• Hyperliquid Labs leads core development. Its docs say the team is led by Jeff and iliensinc, Harvard classmates, with other members from Caltech and MIT and earlier jobs at Airtable, Citadel, Hudson River Trading and Nuro. They describe proprietary crypto market making in 2020, a move into DeFi in summer 2022, and no external capital: Labs is self-funded.
• Hyperliquid Corp. makes the web interface at app.hyperliquid.xyz available. Its terms of use (last updated 15 June 2026) say the company does not own, control or operate the blockchain, which is run by a decentralized set of validators.
• The Hyper Foundation runs the bug bounty program, which pays up to 1 million USDC for critical bugs, and a delegation program that stakes HYPE with outside validators it accepts after KYC/KYB checks.
• Validators produce blocks in proportion to the HYPE staked with them, publish the oracle prices used for funding and liquidations, and vote on listing matters such as delisting validator-operated perps.

How trading on Hyperliquid works

1. Connect. Use an EVM wallet such as Rabby or MetaMask, or sign in to app.hyperliquid.xyz with an email address, which creates a wallet whose private key can be exported. Apps from other teams, including Phantom, MetaMask and Dexari, also connect to the same order books.
2. Deposit. USDC can come in from Arbitrum, Ethereum, Base or Polygon. BTC, SOL, ETH and several other assets can be sent too; the support guide says deposits on those networks are handled by Unit Protocol, a separate team, and that a fiat on-ramp is run by Swapped.com. The first transfer into a new HyperCore account costs a one-time activation fee of 1 USDC (or 1 unit of another quote token).
3. Trade. Perpetuals use USDC as collateral. You pick an asset, a direction, a size and a leverage level up to that asset's maximum. The highest maximum in the market list on 1 November 2026 was 40x, and the API listed 179 active validator-operated perps. Orders are gas-free once funds are on HyperCore.
4. Withdraw. Withdrawals go back to the source chain from the same app. Small gas fees may apply depending on the route.

Beyond the main markets, HIP-3 lets anyone who stakes 500,000 HYPE deploy their own perp exchange on HyperCore and set its oracle and contract terms. On 1 November 2026 the API listed ten such deployer exchanges. The Interface terms say markets created this way are not reviewed or approved by the company. HIP-4 adds fully collateralized outcome markets, which do not use leverage or liquidations; the first is a daily binary market settled to the BTC mark price.

Hyperliquid fees

The fee schedule sets one tier for each account across perps and spot, based on rolling 14-day volume, with spot volume counted twice. Selected perp tiers:

Spot starts higher, at 0.070% taker and 0.040% maker. Staking HYPE lowers fees by 5% (more than 10 HYPE) up to 40% (more than 500,000 HYPE), and a referral code takes 4% off a user's first $25 million of volume. Third-party front ends can add a builder fee of up to 0.1% on perps and 1% on spot, which the user approves in advance. A cheaper-looking app can therefore cost more than the base schedule.

A worked example at the base tier: opening and later closing a $10,000 BTC position with market orders costs 0.045% each way, or $4.50 per side and $9 in total. The same trader with more than 10,000 HYPE staked (Gold, 20% off) pays 0.036%, or $3.60 per side. For the general mechanics, see our guide to maker, taker and gas fees.

Funding is separate from trading fees and passes directly between longs and shorts. It is paid every hour at one-eighth of an eight-hour rate made of a premium term and an interest term fixed at 0.01% per eight hours, and it is capped at 4% per hour. The docs say no fee is taken on funding payments. Trading fees go to HLP, the assistance fund and market deployers. The assistance fund converts its share to HYPE automatically and burns it.

Liquidations, HLP and auto-deleveraging

Maintenance margin is half the initial margin at maximum leverage, so it ranges from 1.25% on 40x assets to 16.7% on 3x assets. When an account falls below it, Hyperliquid first sends market orders to the book to close the position, and any collateral left over stays with the trader. Positions above 100,000 USDC are closed 20% at a time. The docs say there is no clearance fee on these liquidations.

If equity falls below two-thirds of maintenance margin, the position goes to a backstop liquidator vault, part of HLP (Hyperliquidity Provider). In that case the trader loses the remaining maintenance margin, and a backstop of a cross-margin account takes all cross positions and cross collateral. HLP is a protocol vault open to deposits. It makes markets, performs liquidations, and takes a share of fees. Depositors share its profits and losses.

The last safeguard is auto-deleveraging. If an account goes below zero, profitable traders on the other side, ranked by profit and leverage, have their positions closed at the previous mark price. That keeps the system free of bad debt, but it means a winning position can be closed without the trader choosing it. Our risk management guide covers position sizing and stop losses.

HYPE token and staking

HYPE is the chain's native token. Hyperliquid describes it as securing the network through delegated proof of stake, paying network costs and giving trading-fee discounts. On 1 November 2026 the HyperCore token endpoint reported a maximum supply of 1 billion HYPE, a total supply of about 998.8 million (the difference reflects burns) and a circulating supply of about 301.9 million.

Stakers delegate to validators, each of which must self-stake 10,000 HYPE, locked for a year. Rewards come from an emissions reserve at a rate that falls as more HYPE is staked; the docs give about 2.37% a year at 400 million staked, before validator commission.

Who can use it: access restrictions

The Interface terms list "Restricted Persons" who may not use app.hyperliquid.xyz: anyone who lives or is located in, or is incorporated or registered in, the United States or Ontario, Canada; anyone in a sanctioned jurisdiction; and citizens of those sanctioned territories wherever they live. The terms forbid using VPNs or proxies to get around this, and outcome markets carry a further, unnamed list of excluded jurisdictions.

The same terms say neither the Interface nor the Hyperliquid chain is licensed, approved or registered by any regulator. Disputes go to individual arbitration under the London Court of International Arbitration, with the terms governed by the law of England and Wales.

Custody and operational risks

Hyperliquid has no account sign-up and does not hold your keys. You trade from your own wallet, and the terms say the company cannot retrieve or move what is in it. Self-custody here does not mean there is nothing else to trust, though:

• Bridges and deposit routes. USDC is minted natively on Hyperliquid by Circle, and the docs say the older Arbitrum bridge, audited by Zellic, holds less than 10% of HyperCore's USDC. BTC, SOL and other deposits rely on Unit Protocol. Funds sent on the wrong network, or BTC deposits below 0.0003 BTC, can be lost.
• Closed core code. Hyperliquid publishes its node software under Apache-2.0 and its Python SDK under MIT. The matching engine that runs HyperCore is not published as open source, so its behavior cannot be checked from code.
• Validator decisions. Oracle prices are a stake-weighted median of validator submissions built from exchange prices. Validators can vote to delist a perp, which settles open positions at a one-hour average oracle price.
• Impersonation. The support guide warns about lookalike domains such as "hyperliguid.xyz" and about direct messages from fake support staff. Tickets are opened only through the Discord ticket channel or the Zendesk form.

Alternatives by function

Other on-chain perpetuals venues make different design choices. These are not ranked here.

• Order book on its own chain: dYdX also runs perpetuals on a dedicated chain, a Cosmos SDK network whose code is open source.
• Pool-based perpetuals: GMX quotes prices from oracles against shared liquidity pools rather than matching traders on a book.
• Comparing venues: our perpetual DEX ratings set fees and disclosures side by side, and Hyperliquid's own entry is assessed in our Hyperliquid review.