Hyperliquid Revolutionizes DeFi with Composable Liquidity

The concept of liquidity breeding liquidity has become a reality with Hyperliquid, a decentralized exchange that has become the go-to platform for traders of perpetual futures or 'perps'. Founded by Harvard classmates Jeff Yan and iliensinc, Hyperliquid has been live since early 2023 and has capitalized on its substantial order book volume and depth by introducing a concept similar to composability. This concept, originating from decentralized finance (DeFi), allows permissionless smart contracts to interlock like building blocks, forming the foundation of novel tokenized financial products. The Ethereum-compatible HyperEVM, connected directly to Hyperliquid's high-speed HyperCore blockchain, allows other applications to build on top of the platform's shared liquidity. This means that applications such as wallets or even other exchanges can utilize Hyperliquid as a backend, providing perps trading and other services without fragmenting the liquidity. 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 VALR, are utilizing Hyperliquid's 'builder codes', generating approximately $90 million in revenue. The platform has garnered significant praise from its growing user base. 'Hyperliquid is more than just a perpetuals exchange; it's akin to AWS for finance,' said Hyunsu Jung, CEO of Hyperion DeFi. 'The perps aspect is notable, but this is essentially a layer-one blockchain infrastructure, providing liquidity and allowing anyone to build on top of it.' Similar to AWS, builders using Hyperliquid own their users and have full control over the user interface, while Hyperliquid provides the underlying liquidity and execution. Integrators of builder codes can charge fees based on the notional size of their users' trades without needing to develop the backend or maintain liquidity. 'Builder codes enable integrators to focus on delivering a great user experience, while Hyperliquid serves as the backend for liquidity and execution,' said Sterling Barnett, business development lead at Hyperliquid Labs. 'Integrators can offer their users best-in-class on-chain liquidity and institutional-grade infrastructure, earning fees on every trade.' For an application like MetaMask, which has over 100 million users worldwide, integrating with Hyperliquid's EVM module makes perfect sense. Since October 2025, MetaMask has provided its users with self-custodial access to perps directly from the wallet. As a wallet, MetaMask has the advantage of not requiring a decentralized app (dApp) connection, and fund transfers are streamlined, allowing users to trade directly with the tokens they already hold. Hyperliquid handles matching, the oracle, and the margin engine, while MetaMask focuses on the user interface. 'Matching orders is genuinely challenging, and Hyperliquid excels at it, so we don't attempt to rebuild it,' said Matthieu Saint Olive, Staff Product Manager at MetaMask. 'By routing orders directly to the Hyperliquid order book, MetaMask Perps offers some of the best liquidity and execution quality available.' MetaMask has seen growth beyond crypto, with commodities and equities becoming increasingly popular. 'Real-world-asset markets have grown from a small fraction of perp volume at the start of 2026 to roughly a quarter of it today,' Saint Olive added. In terms of fees, MetaMask charges a flat 0.1% builder fee, with no hidden spread or execution costs, allowing traders to verify exactly what they paid. 'We believe transparency is a significant advantage and are actively exploring innovative pricing models to make our economics a reason people choose MetaMask, not a source of friction,' Saint Olive said. It's surprising to see a large centralized exchange, such as VALR, relying on Hyperliquid's perps order book for liquidity. However, this move has proven beneficial for the South Africa-based exchange, which is among the largest in Africa with nearly two million retail customers and about 2,000 corporate institutional customers. After building their infrastructure in-house, including risk and liquidation engines, the VALR team found it challenging to achieve sufficient volume and liquidity for their perpetual futures. 'We saw Hyperliquid bringing a huge amount of volume and market participants from all over the world together and thought, 'Why not plug into that?'' said Farzam Ehsani, CEO and co-founder of VALR. Looking ahead, as major players like Robinhood, Coinbase, and Intercontinental Exchange enter the perps market, there will be opportunities for cross-venue arbitrage, according to Jung of Hyperion. 'You can maintain one position on Robinhood, for example, and the other side of the position on Hyperliquid, allowing you to see more organic mechanisms for funding rates,' Jung said.