According to Arthur Hayes, co-founder of BitMEX and CIO of Maelstrom fund, Hyperliquid's foray into prediction markets is not just about reducing trading costs, but also about capturing the upside. The Hyperliquid Improvement Proposal (HIP)-4, which introduces event trading, is expected to become a dominant prediction market venue.
Hayes argues that the real differentiator is Hyperliquid's exchange token, HYPE, which enables users to benefit from platform activity. This is in contrast to Polymarket and Kalshi, which do not currently offer this feature. Hayes believes that HIP-4 will quickly become a leading prediction market due to Hyperliquid's large user base, low trading fees, and robust technology infrastructure. Additionally, users who own the HYPE token can directly profit from their usage of HIP-4.
In comparison, Polymarket is expected to launch a token, and premarket perpetual contracts tied to the potential token are trading around $14, implying a fully-diluted valuation of roughly $14 billion. HYPE, on the other hand, has an FDV of about $38 billion.
The geographical landscape also plays a role, with Polymarket facing regulatory challenges in Asia and Hyperliquid having a user base that skews towards the region. The contrast is most notable with Kalshi, a CFTC-regulated exchange that is built around compliance and licensing, not token incentives, which likely rules out the kind of value-accrual layer Hayes is pointing to.