Hyperliquid DEX Sparks Wall Street Frenzy - The New Coinbase & Binance Challenger Emerges
Decentralized exchanges are rewriting the rulebook - and Hyperliquid just became the industry's newest heavyweight contender.
The Institutional Shift
Wall Street veterans can't stop drawing parallels between Hyperliquid's explosive growth and the early days of Coinbase and Binance. Trading volumes surged 300% last quarter while traditional exchanges watched from the sidelines. The platform processed over $50 billion in derivatives trades - numbers that make legacy finance executives sweat through their custom suits.
DEX Revolution Accelerates
No middlemen. No permission slips. Just pure market efficiency cutting through regulatory red tape like a hot knife through butter. Users flock to the platform's zero-slippage swaps and institutional-grade liquidity pools. The hype isn't just growing - it's multiplying faster than a hedge fund's management fees.
Traditional finance never saw this coming - but then again, they're still trying to figure out how to charge 2% for underperforming the market.
Governance, token control, and the controversial JELLY incident
If the HLP is the engine, the validators are the control tower. Hyperliquid has only 24 validators, compared to Ethereum’s one million. Nearly two-thirds of staked HYPE, its native token, is controlled by the Hyper Foundation, giving it serious governance power.
That influence was tested during the JELLY incident, when a massive bet on an illiquid token threatened the HLP’s solvency. Validators voted to liquidate the position, and the Foundation reimbursed users with its own funds.
Hyperliquid’s Jeff called it an “exceptional situation” that needed fast action. To some, that looked like a centralized intervention, the opposite of decentralization.
Hyperliquid’s financial model is just as complex. It uses trading fees to buy back HYPE, fueling a loop where higher volumes push token prices. The Assistance Fund, which handles the buybacks, has already built a $1.4 billion war chest.
Supporters call it efficient, but skeptics like Santiago Roel Santos warn it’s “highly reflexive,” especially since it only works if trading activity keeps rising.
Wall Street money, massive upgrade, and looming regulatory attention
Traditional finance is taking notice. Paradigm backed an $888 million Nasdaq-listed fund to hold HYPE, giving institutions exposure without touching the exchange. Its board includes Eric Rosengren, the former Boston Fed president.
David Schamis of Atlas Merchant Capital, now CEO of that fund, said Hyperliquid is “like Coinbase and ethereum combined,” claiming the company is already making over $1 billion in yearly free cash flow, with fewer than 15 employees.
Over 100 projects are now building on the platform, according to DefiLlama, putting it in the same league as BNB Chain and Solana. A new upgrade rolled out this week lets wealthy users launch their own perpetual futures markets in minutes, no listing committee required.
They must stake millions in HYPE as collateral, and validators can slash funds if abuse is detected. It’s a high-risk, high-bar system that opens the door for any custom market, even one tracking volatility.
Hyperliquid Labs recently told the U.S. Commodity Futures Trading Commission (CFTC) that its perpetuals already meet, and sometimes exceed, U.S. market safeguards. Olsen from Jump Trading, seated beside CFTC acting chair Caroline Pham, said the project “is exposing gaps in the current regulatory framework.”
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