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. The Hyperliquid Improvement Proposal (HIP)-4 introduces event trading with a zero-fee-to-open model, but Hayes argues that the true differentiator is the HYPE token, which enables users to benefit from platform activity. This sets Hyperliquid apart from competitors like Polymarket and Kalshi, which do not offer similar token-based incentives. With a large user base, lower fees, and robust technology infrastructure, Hyperliquid is poised to become a leading prediction market platform.
The HYPE token has a fully diluted valuation of around $38 billion, compared to the implied valuation of a potential Polymarket token, which is around $14 billion. The geographic distribution of users also favors Hyperliquid, with a strong presence in Asia and no regulatory constraints. In contrast, Polymarket and Kalshi face regulatory hurdles and do not offer token-based incentives, making Hyperliquid's model more attractive to users.