Hyperliquid must draw developers or risk dissolution: VanEck
Layer-1 blockchain network HyperLiquid will need to leverage its strong developer community to sustain its native token with a market capitalization of nearly $25 billion, asset manager VanEck said in a Jan. 6 research note.
HyperLiquid has become one of the most valuable blockchains since launching the HYPE token in a November airdrop. However, HyperLiquid's new modern contract platform has yet to attract a large developer community, VanEyck said.
If HyperLiquid fails to meet the growth expectations of the community, the prisoner's dilemma faced by many newly wealthy $HYPE holders could quickly unravel, VanEck said.
“Once again, we can see another Icarian tale of crypto hubris.”
Hyperliquid's market share has increased over the past year. Source: VanEck
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Fast growth, high expectations
In the year Since its launch in 2024, Hyperliquid's flagship continuous futures exchange has held approximately 70% of the market share, surpassing rivals such as GMX and Dydx. It now handles about $260 million in transactions every day, VanEyck said.
Hyperliquid's growth reflects broader gains for decentralized exchanges (DEXs), which saw monthly trading volume surge to $433 billion in December, VanEck reported.
Fixed futures, or “perps,” are derivatives that allow traders to buy or sell an asset in the future with no expiration date.
Meanwhile, Hyperliquid's airdrop has been widely hailed as the most successful token generation event of 2024.
The HYPE token It has gained over 500% since its launch on November 29. After reaching a peak of nearly $34 per token in December, HYPE has returned to $25 as of January 7, according to CoinGecko.
“HyperLiquid is the 13th most valuable project in crypto in a month of trading,” VanEck said.
That's partly because “HyperLiquid has built a solid history of development as a general-purpose blockchain,” VanEyck said.
Monthly DEX volumes increased by the end of 2024. Source: Van Eek
According to VanEyck, DEXs such as HyperLiquid “lack long-term competitive lethality.” […] Because most DEXs are based on open source code and offer features that are easy to copy.
In the year By 2025, HyperLiquid aims to launch the Ethereum Virtual Machine (EVM) smart contract platform, which VanEck says is critical to diversifying L1's revenue base and ensuring HYPE's high valuation.
At least half a dozen Hyperliquid-native decentralized applications (DApps) are live on EVM's testnet, in some cases visited by thousands of users, according to ASXN, a Web3 researcher.
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