Hyperliquid Revolutionizes DeFi with Composable Liquidity

The concept of liquidity begetting liquidity is a well-known phenomenon. Hyperliquid, a decentralized exchange, has become a top choice for traders, particularly those interested in perpetual futures. Founded by Harvard classmates Jeff Yan and iliensinc, Hyperliquid has capitalized on its order book volume and depth by introducing composability, allowing permissionless smart contracts to interlock like building blocks. Its Ethereum-compatible HyperEVM connects to the HyperCore blockchain, enabling applications to utilize shared liquidity. Hundreds of developers, including MetaMask and VALR, have integrated Hyperliquid's system, generating $90 million in revenue. The platform's growing user base praises its capabilities, with Hyunsu Jung, CEO of Hyperion DeFi, comparing it to AWS for finance. Hyperliquid provides underlying liquidity and execution, while builders own their users and control the interface. The 'builder codes' feature allows integrators to charge fees without developing the backend or maintaining liquidity. For apps like MetaMask, integrating with Hyperliquid makes sense, as it provides self-custodial access to perps and streamlined fund transfers. The partnership enables MetaMask to focus on user experience, while Hyperliquid handles matching, oracles, and margin engines. According to Matthieu Saint Olive, Staff Product Manager at MetaMask, Hyperliquid excels at matching orders, providing some of the best liquidity and execution quality available. As the platform grows, it's seeing expansion beyond crypto into commodities and equities. When it comes to fees, MetaMask charges a flat 0.1% builder fee, with no hidden spread. The exchange VALR has also partnered with Hyperliquid, handing over liquidity requirements to its perps order book. Despite initial difficulties in gaining volume and liquidity, VALR's CEO, Farzam Ehsani, found that integrating with Hyperliquid brought significant benefits. Looking ahead, opportunities for cross-venue arbitrage are expected to arise as major exchanges enter the perps market.