According to Arthur Hayes, co-founder of BitMEX and CIO of Maelstrom fund, Hyperliquid's foray into prediction markets is not just about offering cheaper trading, but also about capturing the upside. The Hyperliquid Improvement Proposal (HIP)-4, which introduces event trading, is expected to play a significant role in this endeavor. Hayes believes that the real differentiator is the HYPE token, which enables users to benefit from platform activity, unlike users of Polymarket or Kalshi. With a large user base, lower trading fees, and a robust tech infrastructure, Hyperliquid is poised to become a dominant player in the prediction market.
The HYPE token, with a fully-diluted valuation of around $38 billion, allows users to directly profit from their usage of the platform. In contrast, Polymarket and Kalshi do not offer similar token incentives, with Polymarket's expected token launch and Kalshi's compliance-focused model limiting their ability to provide users with a path to the upside of the platform. The geographic landscape also favors Hyperliquid, with its user base skewed towards Asia, where crypto-native trading is already established, and no equivalent regulatory constraints. 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.