Arthur Hayes, co-founder of BitMEX and CIO of Maelstrom, believes that Hyperliquid's foray into prediction markets is not just about offering cheaper trading, but about capturing the upside. The Hyperliquid Improvement Proposal (HIP)-4, which introduces event trading on the platform, is expected to be a key driver of this growth. Hayes argues that the real differentiator is HYPE, Hyperliquid's exchange token, which allows users to profit directly from their platform activity. This sets Hyperliquid apart from competitors like Polymarket and Kalshi, which do not currently offer this feature.
With its large user base, lower trading fees, and robust tech infrastructure, Hyperliquid is well-positioned to become a dominant player in the prediction market space. The fact that users can own the $HYPE token and directly benefit from their usage of HIP-4 is a major advantage. In contrast, Polymarket is expected to launch its own token, $POLY, but its valuation is significantly lower than that of HYPE. Meanwhile, Kalshi's model is built around compliance and licensing, rather than token incentives, which limits its users' ability to access the upside of the platform.
The geographical distribution of Hyperliquid's user base, which skews towards Asia, also gives it an edge over its competitors. Overall, the combination of HYPE and Hyperliquid's user base makes it an attractive proposition for those looking to participate in prediction markets.