According to Arthur Hayes, co-founder of BitMEX and CIO of Maelstrom fund, Hyperliquid's foray into prediction markets is not just about offering cheaper trades, but about capturing the upside. Hyperliquid's zero-fee-to-open model for event trading under HIP-4 is expected to introduce a new era of prediction markets. Hayes argues that the true differentiator is the HYPE token, which enables users to profit directly from platform activity. This sets Hyperliquid apart from competitors like Polymarket and Kalshi, which do not offer similar benefits to their users.
With a large user base, lower trading fees, and robust tech infrastructure, Hayes predicts that HIP-4 will become a dominant force in prediction markets. The valuation of HYPE, with a fully diluted value of around $38 billion, far exceeds that of potential competitors. Meanwhile, Polymarket is expected to launch its own token, and Kalshi's model, built around compliance and licensing, is unlikely to offer token incentives.
The geographical landscape also plays a role, with Hyperliquid facing fewer regulatory constraints and a user base skewed towards Asia, where crypto-native trading is prevalent. In contrast, Polymarket and Kalshi face various regulatory hurdles, limiting their ability to offer token-based incentives. The structural split between the three platforms is clear: Hyperliquid ties usage to a token, Polymarket appears to be moving in that direction, and Kalshi's model likely prevents it altogether.