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In-depth analysis of Hyperliquid: How Binance on-chain subverts contract trading, Lao Lee takes you to the wool

Why does Hyperliquid make Binance nervous? Reveal the core technology, user experience and money-making opportunities of this leading on-chain contract, and come with permanent discount codes for mainstream exchanges to help you save handling fees.

In-depth analysis of Hyperliquid: How Binance on-chain subverts contract trading, Lao Lee takes you to the wool

#Hyperliquid in-depth analysis: How Binance on-chain subverts contract trading, Lao Liek takes you to the wool

Brothers, let’s talk about something serious today - Hyperliquid. This thing is no longer the old-fashioned Perp DEX like GMX and DYDX. It is a high-performance Layer-1 public chain specially built for financial transactions. The community calls it "Binance on the chain", or more arrogantly, "AWS with the most liquidity". Today we will break it apart and crush it to see where the cow is, and teach you how to shear the wool.

1. What is Hyperliquid? Not just DEX, but also a financial public chain

To put it bluntly, Hyperliquid is a Layer-1 public chain like Ethereum and Solana, but its goal is even wilder: to be a high-performance on-chain transaction infrastructure that carries all financial activities.

It started with Perpetual Contract (Perp) DEX, and now its business has expanded to spot trading, and it is also launching its own stable currency USDH. Looking at its development proposal (HIP), you can see that its ambitions are not small: from HIP-1 to HIP-3, and recently the community has proposed HIP-4 to build an "event prediction market" similar to Polymarket, and the product boundaries are constantly expanding. This clearly aims to create a huge on-chain financial ecosystem and compete with traditional CEX for jobs.

2. Core technology: Why can it achieve “on-chain CEX speed”?

The Hyperliquid team starts from "first principles" to solve the black box operation and poor experience of CEX, as well as the performance bottleneck of DEX. Their self-developed architecture is divided into two parts:

  • HyperCore: This is the Central Limit Order Book (CLOB) matching engine on the chain. The entire process of placing orders, matching, margin, and liquidation is handled on the chain, making it transparent and open. It gave up the AMM model with poor experience and chose CLOB, which is the same as traditional exchanges. This is also the common choice of emerging Perp DEXs such as Aster and Lighter.
  • HyperEVM: This is a general smart contract layer that shares consensus with HyperCore and is compatible with Ethereum EVM to facilitate the integration of other applications.

Its consensus mechanism uses improved HyperBFT. This tightly coupled design brings terrifying speed: The median transaction delay is only 0.2 seconds, and the peak throughput can reach 200,000 transactions/second, achieving sub-second transaction final confirmation. In a word: It uses a decentralized approach to create a smooth experience for centralized exchanges (CEX).

3. User experience: as smooth as playing Binance

For users, the interface and operating experience of Hyperliquid are almost the same as those of head CEX:

  • Familiar order book + candlestick chart. -Support advanced limit orders, stop-profit and stop-loss.
  • Transaction settlement is almost real-time, and the operation is smooth without lag. Even the "da" sound for opening and closing a position is very high-quality, much better than many pheasant platforms.

Access requires the use of a Web3 wallet (no custody), and assets must be deposited into USDC through the Arbitrum bridge. Afterwards, an "Agent Wallet" will be generated that stores the private key locally. There is no need to sign repeatedly when opening and closing positions, and the experience is very smooth.

What’s even more rare is the team’s responsibility. After an API failure caused downtime in July 2025, the team quickly compensated users for about US$2 million out of their own pockets. This wave of operations has attracted countless fans in the community, and is much better than those platforms that pretend to be dead when something goes wrong.

4. Liquidity and Depth: The leading position is unshakable

The data doesn’t lie, Hyperliquid is already the absolute leader in Perp DEX:

  • In July 2025, its monthly perpetual transaction volume reached 319 billion, accounting for approximately 65% of the entire on-chain Perp market (487 billion).
  • In August 2025, its trading volume even accounted for 13.85% of Binance futures trading volume, the highest in history.
  • The platform TVL (Total Locked Value) reached approximately 2.7 billion USD in September 2025, far exceeding all competitors.

Thanks to the transparency of the on-chain order book and the HLP market-making pool, it has extremely low spreads on mainstream currencies, small slippage in large transactions, and its depth is comparable to top CEXs.

In terms of handling fees, Maker 1.5bps / Taker 4.5bps, which is slightly lower than mainstream CEX. Staking HYPE tokens can also enjoy a handling fee discount of up to 40%** (similar to Binance's BNB upgrade).

5. Economic model and treasury: a powerful flywheel of value

Hyperliquid’s treasury system is very cleverly designed and is the engine of its sustainable development:

  1. Assistance Fund (AF): The core "treasury" of the agreement, about 93% of the platform handling fees are injected into it to repurchase and destroy HYPE tokens, forming a positive cycle of "increasing transaction volume → increasing deflation".
  2. HLP Market Making Pool: Anyone can deposit USDC to become a liquidity provider and share market making profits (currently the annual rate is about 6.7%), and the rules are completely transparent.
  3. User Vaults: Similar to the follow-up system, the trading master (Leader) can manage the funds and take a 10% commission after making profits. The agreement does not require additional commissions.

6. Team and Community: The Victory of Elite Small Teams

The founder, Jeff Yan, comes from a traditional high-frequency trading company and has a Harvard background. The core team only has about 11 people, which can be called an elite team.

The most stubborn thing is that the ** project is completely self-funded, rejects all VC investment**, and does not reserve private equity shares. All decisions put the interests of users and the community first. This "non-VC" hardcore style has won the deep trust of the community. In November 2024, its token HYPE airdropped 31% of the total amount to early users. Many early participants received generous returns, and the reputation exploded.

7. The secret of success: the combination of "Tao" and "Technology"

The outbreak of Hyperliquid is no accident:

  • From a "technical" point of view: It accurately captured several stage dividends: 1) Airdrop incentives attracted early users; 2) Undertaken users who flowed out of CEX (such as Binance) due to regulation; 3) Launched the killer "Build Codes" plan, allowing developers to build front-ends based on its infrastructure with extremely low thresholds, achieving exponential distribution growth.
  • Looking from the "Tao": It truly carries the banner of the blockchain spirit - openness, transparency, decentralization, and user sovereignty. When users are fed up with CEX’s black-box operations and potential risks, a choice that is both transparent and high-performance naturally becomes popular.

Written at the end: DEX is the general trend, but choosing the entrance is very important

The rise of Hyperliquid clearly indicates a trend: In the future, more trading activities will migrate to transparent, on-chain DEX. Even Binance has launched its own "Prince" - Aster (also using CLOB's Perp DEX) to cope with this change.

For us ordinary users, whether they are exploring emerging leaders like Hyperliquid or trading on top CEXs such as Binance and OKX, security and cost are always the first.

Remember the old leek’s advice:

  1. Always choose a formal, licensed large exchange, stay away from those "pheasant platforms" whose names you have never heard of, and beware of the risk of running away.
  2. Make good use of invitation codes, you can save a little, and the little will add up. Especially for high-frequency traders, fee discounts are real money.

If you are also interested in Aster and other new generation Perp DEX, you may wish to register through our exclusive link, which is safe and convenient:

  • Register Aster: Use the referral code 91B1d1, register through this link to enjoy 10% trading rebate: Register Aster now

Of course, if your main transactions are still on mainstream platforms such as Binance, OKX, Bybit, etc., don’t forget to use our exclusive invitation code to obtain permanent fee discounts/rebates:

  • Register for Binance: Use the referral code LULALA and register through this link to enjoy a 20% fee discount: Register for Binance now
  • Register OKX: Use the referral code LULALA, and register through this link to enjoy 20% discount on handling fees: Register OKX now
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(This article only provides information sharing and does not constitute any investment advice. The market is risky, so be cautious when entering the market.)

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