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 introduces event trading on the platform with a zero-fee-to-open model. Hayes believes that the real differentiator is the HYPE token, which enables users to profit from platform activity, unlike Polymarket and Kalshi.
With a large user base, lower trading fees, and robust tech infrastructure, Hayes predicts that HIP-4 will quickly become a dominant prediction market. The HYPE token has a fully-diluted valuation of around $38 billion, compared to Polymarket's implied valuation of $14 billion. While Polymarket and Kalshi face regulatory constraints, Hyperliquid's user base is skewed towards Asia, where crypto-native trading is prevalent.
The contrast is most notable with Kalshi, a CFTC-regulated exchange that focuses on compliance and licensing, rather than token incentives. This makes it a direct test of Hayes' thesis, as users can trade event outcomes on Kalshi but have no access to the platform's upside.