Arthur Hayes, co-founder of BitMEX and CIO of Maelstrom fund, believes that Hyperliquid's foray into prediction markets is not just about offering cheaper trading, but also about capturing the upside. Hyperliquid's push into prediction markets is driven by its zero-fee-to-open model for event trading under HIP-4, which introduces event trading on the platform. Hayes argues that the real differentiator is Hyperliquid's exchange token, HYPE, which enables users to profit directly from platform activity, unlike Polymarket and Kalshi.
With a large user base, lower trading fees, and robust tech infrastructure, Hyperliquid's HIP-4 is poised 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.
While Polymarket and Kalshi face geographical constraints and regulatory hurdles, Hyperliquid's user base is skewed towards Asia, where crypto-native trading is already prevalent. In contrast to Kalshi, which is built around compliance and licensing, Hyperliquid's model ties usage to the HYPE token, allowing users to access the upside of the platform. This structural difference could give Hyperliquid a significant advantage in the prediction market space.