According to Arthur Hayes, co-founder of BitMEX and CIO of Maelstrom, Hyperliquid's foray into prediction markets is centered around capturing the upside, not just reducing trading costs. Hyperliquid's zero-fee-to-open model for event trading under HIP-4 is expected to disrupt the market. Hayes argues that the real differentiator is the HYPE token, which enables users to benefit from platform activity, unlike Polymarket and Kalshi. With a large user base, lower trading fees, and robust tech infrastructure, Hyperliquid's HIP-4 is likely to become a dominant prediction market.
The HYPE token has a fully-diluted valuation of around $38 billion, compared to Polymarket's implied valuation of $14 billion. Hayes' argument also highlights the geographical advantages of Hyperliquid, with a user base skewed towards Asia, where crypto-native trading is prevalent.
In contrast, Polymarket and Kalshi face regulatory constraints, with Kalshi's model built around compliance and licensing, rather than token incentives. This structural difference makes Hyperliquid's HYPE token a key driver of its prediction market success.