Author: Thor Hartvigsen, On Chain Times encryption researcher; Translation: Golden Finance xiaozou

1. Foreword

From Since the launch of HYPE, Hyperliquid has achieved tremendous growth in both transaction volume and revenue. HYPE was launched on November 29 at $2 and rose more than 1,400% in less than a month. This article will delve into the fundamentals of Hyperliquid and HYPE, exploring the bullish case for HYPE and its potential valuation given volume and revenue growth in 2025.

2. Transaction volume

Before the release of HYPE, skeptical people expected that the transaction volume after the airdrop would be low because the sustainable decentralized exchange has been The various behaviors of ’s show exactly this... Greedy capital will move from the highest reward agreement to the next highest reward agreement. It is worth noting that since the release of HYPE, Hyperliquid’s trading volume has increased dramatically, hitting a new daily high of more than $10 billion in just one day. In addition to the massive incentives previously given to traders, Hyperliquid is a quality on-chain product that most traders using the platform will recognize.

It is also worth noting that while the first wave of airdrops accounted for 31% of the HYPE supply, an estimated 42.81% of the total supply will be used for Future token distribution and community rewards. While it can be expected that a portion of these rewards are specifically for staking incentives and potential rewards centered around the HyperEVM L1 ecosystem, the current transaction volume and/or the possibility of HYPE holders receiving some kind of reward without their knowledge Sex is not absent.

42.81% of HYPE supply is approximately equivalent to US$11 billion (based on 25 HYPE per price in USD), this is a substantial return, which makes Hyperliquid trading even more attractive for perpetual contract traders. However, it is important to note that this is purely speculation.

(1) Hyperliquid vs CEXs (Centralized Exchanges)

We have been doing this for a long time Track Hyperliquid’s trading volume relative to centralized exchanges like Binance. As time goes byAs more users and transaction volumes move to the chain, Hyperliquid's market share will continue to grow. Comparing Hyperliquid to Binance, it is clear that Hyperliquid still has a long way to go. However, Hyperliquid’s market share showed a clear upward trend in December, as shown in the chart below. In the past two weeks, Hyperliquid's relative market share has remained around 5-8%. According to data from Coingecko, Binance’s recent derivatives daily trading volume ranged from $60 billion to $150 billion. But since there is no way to actually verify these volume figures from centralized exchanges, they may need to be taken with a grain of salt.

(2) Spot trading volume

You may already know that Hyperliquid also has spot tokens market. Hyperliquid also has a spot token market. Since the launch of HYPE, spot trading volume has increased significantly, and the tokens with the largest trading volume are HYPE, PURR, HFUN and PIP.

Tokens are added to the Hyperliquid spot market via auction, and the highest bidder in the auction can Post their ticker. This happens every 31 hours and is currently selling for around $300,000, as shown below. The highest auction price was for GOD on December 16, with bidders paying nearly $1 million.

3. Fees and benefits (1) Perps (perpetual trading)

Hyperliquid fees Paid by traders on the platform. Fees are kept low compared to other exchanges like Binance to incentivize trading activity. For perpetual futures trading, for most people, the fee for a market order (taker) is 0.035% and the fee for a limit order (maker) is 0.01%. The more you do, the lower your fees will be.

In order to calculate the fees charged by a protocol, the average fees paid by traders must be calculated ( Taker and maker transaction volume and average fee level). ASXN did a good job analyzing this in its September report, as shown below. From this, the average fee paid is estimated to be 0.01276%, which is a conservative/mostBad case, since market maker kickbacks are assumed.

Considering this average fee value, if Hyperliquid’s perpetual futures daily trading volume averages of $5 billion to $10 billion, equivalent to annual expenses of $232,870,000 to $465,740,000 (actual expenses may be higher due to conservative assumptions about average expenses).

These fees are charged by the HLP Market Making Vault, Insurance Fund, Assistance Fund, and a number of other various addresses on Hyperliquid. The team has not disclosed information about the exact allocation of revenue generated from trading activity fees on the platform, making it difficult to accurately estimate HYPE buybacks.

(2) Spot (spot trading)

The fees traders pay in the spot market are used to purchase and burn the traded tokens. Not surprisingly, HYPE accounts for the majority of spot trading volume on Hyperliquid. So far, over 100,000 HYPE has been burned from HYPE’s spot fees ($2.5 million at current prices). From a macro perspective, this has no material impact on the supply of HYPE compared to the bailout fund's buybacks (at least not yet).

(3) Spot Auction

Hyperliquid can also collect funds from the winning bidder of the spot auction. Earn considerable income from your funds. At $300,000 per auction, Hyperliquid's annual revenue will increase by $84,774,000. Flo published an excellent analysis article on X, covering Hyperliquid’s revenue under different spot auction prices and daily trading volumes. Based on a spot auction of US$1 million per spot auction and a daily trading volume of US$6 billion, Hyperliquid’s annual revenue is estimated to be US$829.5 million. At a 30x P/E ratio, this would bring HYPE to $74.52 per token.

4. Assistance fund and HYPE buyback

Although it is still uncertain whether the spot auction and the permanent How the income from continued transactions is distributed between the Assistance Fund (AF), Insurance Fund, HLP and other addresses, but we can measure HYPE’s daily repurchase through the Assistance Fund. A few days ago, I published an analysis article onGold 48-hour HYPE repurchase situation. The situation at that time was that 151,000 HYPE were repurchased within 48 hours, equivalent to an annualized buying pressure of US$686 million. In the past two days, Hyperliquid’s average daily trading volume has reached $8 billion.

In contrast to many other crypto protocols, HYPE derives directly from the revenue generated by Hyperliquid value.

5. Future Outlook

Going into 2025, bullish HYPE is a bet on the growing trading volume of Hyperliquid Exchange and the growing demand for spot auctions. This will lead to increased revenue, which will lead to larger HYPE buybacks. One reason Hyperliquid will be used by more and more people is that it also reserves billions of dollars in future bounties, making Hyperliquid a very profitable trading venue. Hyperliquid has a very strong user-centered community, with a lot of thought sharing and strong narrative developed around the protocol and HYPE.

With the emergence of new features such as staking, perpetual trading token margins, and the application ecosystem brought by HyperEVM, there will be many potential positive factors and many Something to look forward to.