According to Arthur Hayes, co-founder of BitMEX and CIO of Maelstrom fund, Hyperliquid's foray into prediction markets is focused on capturing the upside, not just reducing trading costs. Hyperliquid is introducing a zero-fee model for event trading under its HIP-4 proposal, which Hayes believes is only the first step.
He argues that the real differentiator is the HYPE token, which enables users to profit directly from platform activity, a feature that Polymarket and Kalshi do not currently offer. Hayes predicts that HIP-4 will quickly become a dominant prediction market due to Hyperliquid's large user base, low trading fees, and robust technology infrastructure.
Users who own the HYPE token can benefit from their usage of HIP-4, giving Hyperliquid a competitive edge. In contrast, Polymarket is expected to launch its own token, and Kalshi's model is built around compliance and licensing, without token incentives.
The geographic distribution of users also plays a role, with Hyperliquid facing no regulatory constraints in Asia, where its user base is concentrated. The contrast between Hyperliquid, Polymarket, and Kalshi highlights the different approaches to prediction markets, with Hyperliquid's token-based model potentially offering a unique value proposition.