High lipids currently control about 80% of the decentralized permanent futures market, highlighting a rapid control over its competitors. However, this concentration raises concerns about sustainability and potential risks if trading volumes decrease.
summary
- High lipids quickly became the main decentralized and permanent futures platform, processing daily trades of up to $30 billion.
- The lean, self-funded team has built a fast, run-centered blockchain with fee sharing incentives that attract traders and developers.
- Despite rapid growth, risks such as validator focus, transparency gaps and reliance on high trading volumes remain uncertain about the future.
In just a year, high lipids have grown into the dominant player of a dispersed, permanent future, with Redstone estimating new concerns about how long such intensive activity will last, with IT managing around 80% of the market, trading volumes comparable to large-scale centralized exchanges.
At its peak, the platform handled $30 billion in daily transactions. That milestone is only a few that have reached a small dispersed exchange despite being run by a lean team of just 11 people.
The platform co-founded by former Hudson River trading volume and Harvard alumni Jeff Yang was chosen from the start to avoid venture capital.
Trading volume across decentralized exchanges | Source: Coingecko
At the beginning of 2024, decentralized exchange Dydx accounted for around 30% of the volume of trading across decentralized exchanges. By the end of the year, its share had fallen to about 7%, but Hyperliquid’s share was stable at over 65% per Coingecko data.
Much of Hyperliquid’s growth appears to be linked to execution. One-click trading, zero gas fees and sub-second order finalization helped attract both retail and professional traders as they approached a central exchange than most DEXs.
“Builded by a lean, self-funded team that refused to accept the money of VC investors, they have proven that technical excellence and community-first economics can compete with funded competitors.”
Red Stone
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The platform runs on its own blockchain using HyperBft. This is a consensus system designed to process orders of hundreds of thousands of seconds with payment finality in less than a second. By focusing first on speed and reliability before expanding the infrastructure, high lipids appear to have gained reliability among traders faster than most peers.
Incentives and revenue
The platform splits the community and transaction fees. Those listing new spot markets can maintain half the fees those trades generate. Developers who build user interfaces will gain a share beyond the protocol’s own cut. And those who launch a permanent market share the rates with the investors behind them.
This setup has encouraged external developers to build on the platform without the need for grants or grants. They already create tools to bridge the gaps, such as traders using one balance in different positions or borrowing against assets. As a result, there is an increasing number of ecosystems where competing distributed exchanges were unable to replicate.
Distributed exchange by trading volumes | Source: Defilama
Defillama’s data ranks third in decentralized exchanges by weekly volume, after only Pancakeswap and Uniswap, generating over $12 billion. That surge helped generate more than $1 billion in annual revenue, converted to an estimated $102.4 million per employee.
As previously reported by Crypto.News, that figure is only $93 million, $37.6 million, Nvidia exceeds $3.6 million, and Cursor exceeds $3.3 million.
Future risks
The joint report of Oak Research and GL Capital notes that despite the rapid growth of Hyperliquid, “we still have to meet some important milestones to validate the (assessment) paper.”
“Nutrification remains a concern, with only 16 validators and the lack of codebase transparency could potentially thwart third-party developers. Full control of the infrastructure is a powerful model, but it exposes the platform to vulnerability, as shown in the HLP incident.”
Orc Research and GL Capital
The platform’s reliance on sustained trading volumes further amplifies risk. The long-term bear market could challenge a token repurchase system that temporarily suppresses returns and supports many of the hype ecosystem.
From an valuation perspective, analysts describe the opportunity as “asymmetric risk/reward”, with the fair value of the hype estimated between $32 and $49 under conservative assumptions. That’s the top 86% of that range, with the hype being traded for $42.
High lipids have demonstrated rapid adoption, but still face multiple structural and market risks. Validator concentration, transparency gaps, high trading volume dependence, and execution dependency growth all means that the outcome remains sensitive to both internal decisions and external market conditions.
read more: Circle chooses high lipids as its next USDC base amid the $5.5 billion AUM boom
