Hyperliquid on-chain

The Hyperliquid Ecosystem and HyperEVM: A 2025 Overview

Introduction:

Hyperliquid is a high-performance Layer-1 blockchain purpose-built to “house all finance” on-chain. It launched in late 2023 as a decentralized exchange with centralized-exchange (CeFi) level performance—notably an on-chain perpetual futures exchange with a central limit order book (CLOB) and sub-second finality. The network’s core, called HyperCore, provides ultra-fast spot and perpetual trading with a built-in matching engine and deep liquidity, while its native token HYPE fuels the ecosystem as gas and governance token. To broaden its capabilities beyond trading, Hyperliquid introduced HyperEVM in February 2025 – an Ethereum Virtual Machine execution layer integrated into Hyperliquid’s L1. HyperEVM shares the same HyperBFT consensus and state as HyperCore, enabling smart contracts to interoperate seamlessly with Hyperliquid’s order books. In essence, Hyperliquid blends a bespoke financial blockchain (HyperCore) with a general-purpose EVM environment (HyperEVM), delivering CeFi-like speed (blocks <1s, ~0.2s latency) alongside Ethereum-compatible programmability.

This unique architecture allows developers and users to enjoy low fees (often zero gas for end-users) and high throughput while tapping into the native liquidity of Hyperliquid’s exchange. For example, a lending dApp on HyperEVM can read real-time prices from HyperCore order books and execute on-chain liquidations via built-in system calls, leveraging the same deep liquidity that powers Hyperliquid’s exchange. After an “alpha” rollout of HyperEVM with limited tooling (honoring a “no insiders” fair launch ethos), Hyperliquid’s developer community is rapidly expanding its ecosystem. Below we analyze the current state of this Hyperliquid on-chain ecosystem, covering key metrics, emerging use cases, notable protocols, community buzz, and how Hyperliquid stacks up against other Layer-2s and alternative chains.

Explosive Growth: Key Metrics and Trends

The past year has seen Hyperliquid surge from obscurity to a top blockchain environment by many metrics. After mainnet launch, user activity and capital poured in at an astounding rate. Daily active addresses have reached new all-time highs, recently topping 18,000 unique users per day on HyperEVM– an exponential rise of over 13,000% year-on-year. As the chart below illustrates, Hyperliquid’s user base grew from only a few hundred daily users in early 2024 to tens of thousands by mid-2025, reflecting the viral uptake of its platform.

Capital inflows have been equally impressive. Total Value Locked (TVL) in the Hyperliquid ecosystem has soared into the billions, making Hyperliquid the 11th-largest chain by DeFi TVL worldwide. By late May 2025, Hyperliquid recorded over $3.5 billion in USDC locked on-chain, up from just ~$350 million two months prior – a 350% surge driven by new DeFi protocols and yield opportunities. This ~$3.5B TVL is about one-fifth of Solana’s, highlighting that while Hyperliquid’s scale still trails older networks, its growth trajectory is unmatched In fact, since launch, Hyperliquid’s TVL skyrocketed over 4400%, far outpacing most Layer-1s. The HYPE token has similarly outperformed: it rose roughly 12× in value in its first year, becoming one of 2024’s best-performing crypto assets. HYPE recently hit new all-time highs around $40+, propelled by rising usage and an ongoing token buyback program funded by exchange revenues.

Trading activity on Hyperliquid’s exchange is record-breaking in the DeFi sector. The platform now handles ~70% of all on-chain perpetual futures volume, dominating the decentralized perps market. Daily derivatives volume often exceeds $10 billion, with open interest reaching $10.1 billion in May 2025 – a new high that underscores deep liquidity. In a 24-hour span, Hyperliquid has generated over $5.6 million in fees for liquidity providers and stakers. Its success has attracted crypto whales and power traders: notable figures like James Wynn and Machi Big Brother have publicly traded nine-figure positions on Hyperliquid, praising its transparency and low slippage. Their activity, including one trader’s $100M profit (and loss) in a week, has drawn widespread attention to Hyperliquid’s robustness. This “whale watch” phenomenon on X (Twitter) has further fueled retail interest in Hyperliquid as users flock to the platform where big players are active.

Developer activity on Hyperliquid is strong and growing. With HyperEVM live, dozens of projects have sprung up or migrated to build on the chain. Over 35 teams were ready to deploy as HyperEVM launched, and more have joined since – from independent DeFi startups to established cross-chain protocols. The community-run directories like Hypurr Collective and Hyperliquid.wiki list an extensive range of ecosystem projects across DeFi, NFTs, GameFi, and infrastructure On the core development side, Hyperliquid’s own team has been active with monthly code commits and rapid iteration. Recent upgrades include support for permissionless asset listings and builder-deployed perpetual markets (HIP-3), expanded validator nodes, and the introduction of on-chain governance for risk parameters These steps indicate a push toward greater decentralization and community control of the network, addressing early concerns about centralization while maintaining performance. In summary, Hyperliquid enters mid-2025 with hockey-stick growth in users and liquidity, a robust pipeline of new dApps, and a clear lead in the on-chain trading arena.

DeFi on Hyperliquid: Perpetuals and Beyond

Hyperliquid’s strongest domain is Decentralized Finance (DeFi), where it started as a cutting-edge perp DEX and is now expanding into a full-spectrum DeFi ecosystem. At its core is the Hyperliquid exchange – a fully on-chain perpetual futures and spot trading platform that delivers CEX-level speed with DeFi’s openness. Unlike AMM-based DEXs, Hyperliquid uses an order book + matching engine (HyperCore) to offer deep liquidity and tight spreads on major crypto perp contracts. Traders benefit from sub-second trade finality and median 0.2s latency per transaction, enabling even high-frequency strategies on-chain. Remarkably, end-users pay virtually no gas fees for trading; the platform’s design and tokenomics cover costs so that trading feels as seamless as on a centralized exchange. This has made Hyperliquid extremely popular among sophisticated traders and liquidity providers. The HyperLiquid Vault (HLP), an internal market-making vault, has grown to over $400M TVL, as users deposit assets to earn yield from trading fees. Despite a hiccup in March 2025 – when a manipulation of a small-cap asset (JELLY) caused the vault’s TVL to briefly plunge from $510M to $150M – Hyperliquid demonstrated resilience. The team swiftly halted the affected market and minimized losses via a forced settlement, restoring confidence. Within two months, the HLP vault rebounded to $418M (with ~13.4% APY yield) and the incident, rather than deterring users, highlighted Hyperliquid’s ability to handle crises and massive positions transparently.

With HyperEVM live, DeFi protocols are now proliferating on Hyperliquid beyond the native exchange. A flagship example is Felix – dubbed “the people’s stablecoin” of Hyperliquid. Felix is a collateralized debt protocol (CDP) where users can borrow a native stablecoin (feUSD) by depositing HYPE or other major assets as collateral. Launched in 2025, Felix quickly gained traction as Hyperliquid’s answer to MakerDAO, reaching over $100M in outstanding loans within weeks. Its growth has contributed significantly to the ecosystem TVL and provides an on-chain source of leverage for Hyperliquid users. Another major DeFi integration is Abracadabra.Money, the well-known issuer of Magic Internet Money (MIM) stablecoin. Abracadabra has extended its lending “cauldron” contracts to HyperEVM, allowing users to mint MIM on Hyperliquid and leverage interest-bearing assets. The Abracadabra community even proposed “PurrSwap” – a Hyperliquid-native stable swap AMM – to concentrate MIM and stablecoin liquidity on HyperEVM. This would ensure low-slippage swaps for stable assets and keep liquidity encapsulated within Hyperliquid’s economy. As of mid-2025, cross-chain bridges like Across Protocol and deBridge have facilitated influxes of stablecoins (USDC, USDT, MIM, etc.) to Hyperliquid, seeding its DeFi markets with ample capital.

Beyond stablecoins, lending and yield protocols are flourishing. Hyperlend (by Ambit Finance) is the first money-market on HyperEVM, offering over-collateralized loans and yield opportunities (it’s live on testnet and positioned to be a “premier DeFi hub” on Hyperliquid) Cluster is an omnichain lending project focusing on LSD (liquid staking token) collateral across Ethereum, Solana, and Hyperliquid, aiming to unlock borrowing against staked assets D2 Finance provides tokenized strategy vaults with verifiable on-chain returns over 100% APY, catering to advanced yield farmers on Hyperliquid. There’s also Hypurr Finance, a community-driven lending platform minting a synthetic USD (USDXL) against various assets The AMM and DEX scene on HyperEVM is likewise heating up: HyperSwap has launched as a general EVM DEX and liquidity hub, while community initiatives like Kittenswap promise a community-owned DEX for Hyperliquid users Notably, Rage Trade, a popular perp aggregator on Ethereum, integrated Hyperliquid to route trades to its deep liquidity pools This brings external trading flow into Hyperliquid and gives users access to multiple perp venues via one interface. All these DeFi projects, from stablecoins and lending to DEXs and yield optimizers, indicate that Hyperliquid is rapidly evolving from a single-app chain into a multi-protocol DeFi ecosystem.

NFTs, Gaming, and Novel Use Cases on Hyperliquid

While finance is Hyperliquid’s focus, the ecosystem is also branching into NFTs, gaming, and other verticals – often with a unique twist leveraging Hyperliquid’s financial DNA. For instance, NFT lending and trading have come to Hyperliquid via platforms like BAE (Borrow Against Everything), which touts itself as the “premier NFT lending protocol” on Hyperliquid BAE lets NFT holders use their assets as collateral for instant liquidity, offering high APYs to lenders and even revenue-sharing with NFT projects. There’s also Drip Trade, an NFT marketplace and launchpad built on HyperEVM. Drip Trade supports minting and trading of Hyperliquid-native NFT collections, expanding the on-chain culture into digital art and collectibles. Interestingly, many early Hyperliquid NFTs (like the “Hypurr NFT” collection tied to HYPE airdrops) were distributed to community members, reinforcing user engagement.

GameFi and on-chain gaming are in nascent stages but showing promise. A project called FarmFun exemplifies the creative possibilities: it introduces fully on-chain autonomous AI creatures on “The Farm” (token $FARM), built on Hyperliquid These AI-driven game assets live and evolve on Hyperliquid, demonstrating that the network’s speed can support interactive gaming logic. Other games like Mon and Sovrun have been mentioned as coming to HyperEVM and their development is likely to benefit from Hyperliquid’s low latency (for real-time actions) and integrated economy (in-game assets can immediately tap into DeFi liquidity). Even the social-fi space is seeing crossover: the decentralized social network Farcaster has an interface on Hyperliquid, potentially enabling Hyperliquid users to link their on-chain identity with social profiles and content. Moreover, Hyperliquid’s community seems to appreciate humor and memes – evidenced by tokens like Autist, BOZO, and Frudo listed in the ecosystem, which playfully engage traders (“Hiper-fokusd, brilant, and diffrnt!” declares Autist’s tagline). While these meme projects are niche, they contribute to a vibrant community culture distinct to Hyperliquid.

On the infrastructure and tooling side, significant development is making Hyperliquid more accessible. Cross-chain bridges are a key area: Hyperliquid joined the LayerZero interoperability network to launch “Hyperbridge”, a mechanism allowing assets from any LayerZero-connected chain (Ethereum, Solana, Aptos, etc.) to move into Hyperliquid quickly Third-party solutions like Across and deBridge also support bridging of major tokens, ensuring users can fund their Hyperliquid wallets without friction. A dedicated Hyperliquid bridge called HyBridge is live too, offering fast transfers between EVM and Solana chains in under 10 seconds For data and analytics, tools abound: Goldsky provides real-time indexing and custom subgraphs for HyperEVM data and several block explorers are available (e.g. HypurrScan and HyperScanner) to browse transactions and network stats Traders can utilize advanced dashboards like HyperTerminal and HyperDash to visualize positions and on-chain order flow. The emergence of these tools underscores growing developer activity and support infrastructure around Hyperliquid. Moreover, community-driven initiatives such as the Catalyst Builders DAO and HyperActive fund have formed to incubate projects on Hyperliquid showing that the ecosystem now enjoys early-stage investment and mentorship networks akin to larger chains.

Community Buzz and Top Protocols on X (Twitter)

Hyperliquid’s rise has been fueled in part by an enthusiastic community on X (formerly Twitter), Discord, and Telegram. On crypto Twitter, $HYPE and Hyperliquid-related hashtags trended multiple times in 2025 as the token hit new highs and usage milestones. Observers often share Hyperliquid’s “multi-metric success” posts – highlighting simultaneous ATHs in users, TVL, and volume For example, when HYPE broke above $40, a widely shared stat was that Hyperliquid reached 18k daily users, $3.5B TVL, and $10B+ open interest all at once. Prominent crypto figures have taken note: Arthur Hayes (BitMEX co-founder) publicly praised Hyperliquid and even predicted HYPE could reach $100, spurring debate and excitement in the community. Likewise, the saga of whale traders like James Wynn – who notched massive profits on Hyperliquid – became viral stories, casting Hyperliquid as the playground for high-rollers and validating its deep liquidity. These narratives on social media act as free marketing, attracting curious traders who want to “ ape” into the action where whales roam. The Hyper Foundation’s own X account (@HyperFND) has been a source of updates (despite a brief hacking incident that was swiftly resolved). Official tweets announced milestones such as “The HyperEVM is live…bringing general-purpose programmability to Hyperliquid’s performant financial system”, which garnered significant engagement and signaled to developers that it was time to deploy on Hyperliquid.

Among specific protocols, Felix has gained considerable community attention. Its positioning as a Hyperliquid-native stablecoin resonated with users eager for a decentralized USD on the platform – many on Discord and X discussed strategies to mint feUSD and arbitrage it across Hyperliquid’s order books. Abracadabra’s involvement (with MIM and PurrSwap) also generated buzz, as it linked Hyperliquid to a broader DeFi community that already trusts MIM’s utility. On the NFT side, the HypurrNFT launch (tied to an airdrop) and the growth of Hyperliquid NFT lending saw #HyperNFT hashtags and art previews circulating on X, signaling that culture and collectibles are alive on this finance-centric chain. The Hypurr Collective itself, a community group, actively posts ecosystem news, shares a weekly “top projects” list, and memes about Hyperliquid’s “hyper” growth. All this grassroots activity indicates a loyal and engaged community that is evangelizing Hyperliquid on social media. By organizing meet-ups (the “Hyperliquid World Tour” was mentioned on Bankless media and educational threads, they’re helping onboard new users. In short, Hyperliquid enjoys a level of community-driven marketing and excitement comparable to leading L2s, which bodes well for sustained growth.

Hyperliquid vs. Other L2s and Chains: What Makes It Stand Out?

Hyperliquid’s rapid ascent invites comparisons with both Ethereum Layer-2s (L2s) and other high-performance Layer-1s. In many ways, Hyperliquid combines traits of both. Like L2s (Arbitrum, Optimism, Base), it offers EVM compatibility and low transaction fees, making it easy for Solidity developers to port over appsd But unlike general-purpose L2s, Hyperliquid was conceived as an application-specific chain, tightly optimized for trading. This gives it a performance edge: Hyperliquid’s custom HyperBFT consensus and optimized execution yield sub-second block times and throughput rivaling Solana, whereas optimistic or ZK-rollup L2s often have 2–10 second block times and rely on Ethereum for final settlement. In fact, a recent Messari analysis noted Hyperliquid achieves ~200ms end-to-end latency, effectively outpacing most L2s and even other L1s for real-time transactions Another distinguishing factor is liquidity unity: on many L2s, liquidity is fragmented (each perp DEX or lending protocol has its own pools). Hyperliquid instead aggregates liquidity via its order book – any HyperEVM app can tap the same central liquidity pool without bridging or fragmentation This “single-state” design (HyperCore + HyperEVM unified) means a new app launching on Hyperliquid instantly has access to deep markets for price feeds, collateral, and swaps. It’s a 10× improvement over siloed DEX liquidity on separate chains which is a major draw for DeFi builders.

Compared to alternative high-throughput L1s like Solana, Sui, or Aptos, Hyperliquid has differentiated by vertical integration. Solana, for example, boasts huge user counts and fast transactions, but its DeFi applications (order book DEXs like Serum) are external programs on the chain. Hyperliquid instead built the exchange into the base layer, aligning the chain’s success directly with the app’s success This vertical alignment has paid off – in less than a year, Hyperliquid’s volume and TVL have put it in the top tier, even though its total user count (~286k addresses) is still modest relative to Solana or Ethereum The chaincatcher report highlights that Hyperliquid’s user base is smaller but far more active per capita, driving transaction volumes almost on par with Solana’s (Hyperliquid ranked #2 in daily transactions by end of 2024). Hyperliquid’s token economics also differ: HYPE captures both exchange fee revenue and L1 network value, whereas typically a DeFi app token (e.g. GMX, dYdX) and a layer-1 token are separate. Hyperliquid combines them, which some analysts argue creates a powerful flywheel – exchange usage feeds token buybacks and staking yields, which in turn attract more liquidity. In effect, Hyperliquid is pioneering a vertically integrated crypto economy: a killer app (perp DEX) and its hosting chain in one package This is something the industry hasn’t seen before at scale, and it’s a key reason why Hyperliquid stands out.

Finally, Hyperliquid has differentiated itself through a fair launch, community-first approach that some L2s lack. There were no VC insiders or premine allocations – its token was distributed via an airdrop to early users, and HyperEVM’s launch was done without paid partnerships or “fast grants” to liquidity providers. While this meant a slower start in tooling and integrations, it has built credibly neutral credence for Hyperliquid in the community. Users often cite Hyperliquid’s transparent, on-chain order books and self-custodial model as aligning with DeFi’s ethos, in contrast to some L2 ecosystems that rely heavily on centralized sequencers or off-chain order flow. Hyperliquid Labs has even proactively engaged regulators – submitting comment letters to the U.S. CFTC outlining how its on-chain model enhances market integrity and user protection in derivatives trading. This proactive stance could position Hyperliquid favorably as crypto markets mature under regulatory oversight.

In summary, Hyperliquid’s current state is one of remarkable growth and innovation. Its on-chain ecosystem now spans major DeFi primitives (perpetuals, spot trading, lending, stablecoins, yield vaults), nascent NFT and gaming communities, and a range of infrastructure projects making it easier to build and participate on the network. Key protocols like Felix, Abracadabra, HyperSwap, and Hyperlend are gaining significant traction, often trending in community discussions on X as users explore new opportunities. The network’s metrics – from TVL to daily users – underline its arrival as a top-tier chain by usage, despite being barely a year old. And compared to other L2s or alt-L1s, Hyperliquid distinguishes itself by its hyper-focus on finance and performance: it delivers an almost CeFi-grade trading experience without sacrificing decentralization and composability. As 2025 unfolds, many eyes are on Hyperliquid to see if it can sustain this momentum, attract even more developers, and perhaps serve as a model for the next generation of application-optimized blockchains that marry speed with open finance. If current trends are any indication, the Hyperliquid ecosystem is poised to remain at the forefront of the on-chain finance revolution, living up to its ambitious vision of housing all of finance on-chain.