According to Arthur Hayes, co-founder of BitMEX and CIO of the Maelstrom fund, Hyperliquid's foray into prediction markets is not just about reducing trading costs, but also about capturing the upside. The decentralized exchange is set to introduce a zero-fee-to-open model for event trading under its HIP-4 proposal, which Hayes believes will quickly become a dominant force in the prediction market due to its large user base, lower fees, and robust tech infrastructure.
The key differentiator, however, is the HYPE token, which allows users to directly profit from their usage of the platform. This sets Hyperliquid apart from competitors like Polymarket and Kalshi, which do not currently offer a similar token-based incentive structure.
While Polymarket is expected to launch its own token, and pre-market contracts are trading at a implied valuation of $14 billion, HYPE's fully diluted valuation is around $38 billion, according to CoinGecko data. The geographic landscape also plays a role, with Polymarket facing regulatory hurdles in Asia, while Hyperliquid's user base is skewed towards the region. In contrast, Kalshi's model is built around compliance and licensing, and does not offer a token-based incentive structure, making it the most direct test of Hayes' thesis that token incentives can drive platform adoption and usage.