Hyperliquid Revolutionizes DeFi with Composable Liquidity

The concept that liquidity generates more liquidity is a widely accepted principle. Hyperliquid, a decentralized exchange, has become the go-to platform for traders seeking to engage with perpetual futures, also known as 'perps,' which are blockchain-based derivative contracts allowing users to speculate on asset prices with leverage and no expiration date. Founded by Harvard alumni Jeff Yan and a pseudonymous developer known as iliensinc, Hyperliquid launched in 2023 and has been capitalizing on the depth and volume of its order book by offering a novel concept: composability. This concept, borrowed from decentralized finance (DeFi), enables permissionless smart contracts to interlock seamlessly, much like LEGO blocks, to create new tokenized financial products. Hyperliquid's Ethereum-compatible HyperEVM is directly connected to its high-performance, homegrown HyperCore blockchain, allowing other applications to build upon the platform's shared liquidity without fragmenting it. In essence, applications such as wallets or even other exchanges can utilize Hyperliquid as a backend to offer perps trading and other services. As more developers integrate with Hyperliquid, the platform's liquidity deepens, asset variety expands, and network effects intensify. Currently, hundreds of developers, including prominent names like MetaMask, Phantom wallet, and the South African exchange VALR, are utilizing Hyperliquid's 'builder codes,' generating approximately $90 million in revenue, according to Flowscan. The platform has garnered significant praise from its growing user base. Hyunsu Jung, CEO of Hyperion DeFi, described Hyperliquid as 'the AWS for finance,' highlighting its role as a layer-one blockchain infrastructure that provides liquidity and execution, allowing builders to focus on delivering exceptional user experiences. Similar to AWS, builders maintain control over their users and user interfaces while Hyperliquid handles the underlying liquidity and execution. The 'builder codes' enable integrators to charge fees based on the notional size of their users' trades without needing to develop or maintain the backend or liquidity. Sterling Barnett, business development lead at Hyperliquid Labs, noted that 'builder codes allow integrators to focus on what they do best – delivering a great user experience – while Hyperliquid serves as the backend for liquidity and execution.' For applications like MetaMask, integrating with Hyperliquid's EVM module is a strategic move. MetaMask, which boasts over 100 million users worldwide, has been offering its users self-custodial access to perps directly from the wallet since October 2025. Matthieu Saint Olive, Staff Product Manager at MetaMask, highlighted the benefits of this integration, including streamlined fund transfers and the ability for users to trade directly with the tokens they already hold. Saint Olive also emphasized that MetaMask leaves the matching, oracle, and margin engine to Hyperliquid, as 'matching orders is genuinely hard, and Hyperliquid is excellent at it.' By routing orders directly to the Hyperliquid order book, MetaMask Perps offers some of the best liquidity and execution quality available. MetaMask has observed growth beyond crypto, with commodities and equities becoming increasingly popular. 'Real-world-asset markets have gone from a small slice of perp volume at the start of 2026 to roughly a quarter of it today,' Saint Olive said. In terms of fees, MetaMask charges a flat 0.1% builder fee with no hidden spread, ensuring transparency for traders. The exchange is exploring innovative pricing models to make its economics a draw for users rather than a point of friction. It is notable that even large centralized exchanges, such as South Africa-based VALR, are opting to utilize Hyperliquid's perps order book for their liquidity requirements. Despite initially building their infrastructure in-house, including risk and liquidation engines, VALR found it challenging to achieve sufficient volume and liquidity for their perpetual futures. According to CEO and co-founder Farzam Ehsani, the decision to integrate with Hyperliquid was driven by the platform's ability to bring together a vast amount of volume and market participants from around the world. Looking ahead, as major players like Robinhood, Coinbase, and Intercontinental Exchange expand their perps offerings, opportunities for cross-venue arbitrage will emerge, according to Jung. This could enable users to maintain positions on multiple platforms, such as Robinhood and Hyperliquid, and capitalize on non-toxic flow to generate organic funding rate mechanisms.