In today’s crypto market, one of the biggest challenges faced by crypto traders is the absence of user-friendly crypto exchanges, where centralized exchanges sometimes lack transparency and security, while decentralized exchanges (DEX) often lack liquidity and speed. To solve these problems, Hyperliquid exchange enters the scene as it combines speed, security, and zero gas fees in a fully on-chain setup.
It is a DEX platform that solves the core issues faced by traders like low-speed, transparency issues, liquidity problems and much more. It differs from other DeFi platforms by running its own purpose-built Layer-1 blockchain, developed for improved trading performance. In our series of exchange reviews, today we will review Hyperliquid exchange by discussing its features, pros, cons, and much more.
What is Hyperliquid Exchange?
Hyperliquid is a decentralized exchange platform founded by Jeff Yan and Iliensinc, alumni of Harvard University, in 2023. It is based on the Layer-1 blockchain, HyperEVM, which significantly increases the level of transparency that DeFi (Decentralized Finance) offers while still having the speed and features of centralized exchanges.
It is a unique platform in the crypto sphere due to its smooth user experience and advanced trading features like perpetual futures, cross-margin trading, etc. It was specifically developed for crypto traders who want the quality of the best crypto platform but with the security of a DeFi level.
Key Features of Hyperliquid Exchange?
1. Fully On‑Chain Order Book
The exchange’s most distinctive feature is the fully on-chain order book. It differs from many other platforms that depend on off-chain matching, while in this platform, every trade is recorded directly on the blockchain, which provides more transparency.
2. Ultra-Fast Execution with High Throughput
Thanks to its custom-built HyperBFT consensus mechanism, the exchange delivers fast execution speeds and can handle over 100,000 orders per second, which ensures sub-second confirmations even during high-volume trades.
3. Zero Gas Fees
This zero gas fee model of the exchange makes it attractive as it does not charge gas fees, instead using a low-fee model to make it accessible for all types of investors.
4. Vaults and Liquidity Incentives
To support its ecosystem, the exchange permits you to contribute to liquidity through vaults. In return, they will provide you with rewards. It is a smart way to engage users while keeping the platform’s liquidity deep and reliable.
5. Advanced Trading Tools
It provides its users with trading tools like 50x leverage on perpetual futures, cross-margin trading, isolated-margin trading, etc.
What Makes Hyperliquid Unique?
Below are some properties that make it a unique exchange platform:
1. Layer‑1 Blockchain with HyperBFT Consensus
Hyperliquid is supported by a Layer‑1 blockchain of its own, and the high-speed performance is made possible by HyperBFT. The system is designed in such a way that it can handle over 100,000 orders each second, allowing users to execute multiple trades during price fluctuations.
This customized blockchain provides the exchange with the ability to compete with centralized exchange in terms of speed while maintaining a fully decentralized and trustless environment.
2. On‑Chain Order Book and Zero Gas Fees
Hyperliquid has an on-chain order book, through which traders can access it at any given moment, thus providing transparency in real-time. Every trade is verifiable, and nothing happens behind closed systems or hidden databases. The exchange does not charge gas fees and only asks for low fees of the maker and taker, which is the best for all the users and the one that trades regularly.
3. Smart Liquidity System and Community Focus
The exchange’s most distinctive services are the auto-grounded liquidity and the HIP-based listings. It is deception-proof and keeps the market’s vaulted, ensuring deeper liquidity and helps prevent slippage. The platform is also community-oriented. It is designed with the community in mind, with vaults, rewards, and airdrops that directly benefit users who are not passive but fairly active.
Controversy Associated with Hyperliquid Exchange
Hyperliquid Exchange recently faced controversy over a $10–12 million loss linked to the JELLY token. One of the users manipulated the token’s price and caused forced liquidations. Eventually, they decided to delist JELLY and pay their clients the token’s real price only partially.
The incident was criticized by many traders who accused the platform of operating like a centralized exchange. Many people asked questions about the company and their governance, transparency, and risk control measures. Critics also highlighted its selective decision-making, claiming the exchange intervened only when it was convenient for its liquidity pool.
Furthermore, there have been a lot of users who have stated that they are having problems with fund withdrawals as their accounts got flagged suddenly, and customer support was non-responsive. Given the addition of earlier risk model failures, it now seemed that the platform was not reliable. Though it has promised refunds but trust remains fragile.
Pros and Cons of Hyperliquid Exchange
Below are some pros and cons associated with the exchange, which are as follows:
| Pros | Cons |
|---|---|
| Offers ultra-fast trade execution | There is no fiat deposit options available |
| Provides transparent on-chain data | It only supports USDC withdrawals |
| There is no KYC required to use the exchange | There is is inherent smart contract exposure |
| The exchange provides Leverage up to 50× | The network is still in its early stages |
| Includes advanced features like copytrading. | The liquidity may fluctuate in this exchange |
| It gives its users transparent on‑chain data | Due to the recent JELLY token controversy, it is marked as DEX with a centralization approach. |
Final Verdict
The Hyperliquid exchange provides a new approach to decentralized trading by combining speed, transparency, and advanced tools. Its Layer-1 blockchain and on-chain order book provide an enhanced trading experience. The platform has the potential to become a strong alternative to traditional centralized exchanges.
However, the recent JELLY token controversy and user fund restrictions have impacted its reputation because questions about governance and transparency remain unresolved. Therefore, Hyperliquid must focus on rebuilding user trust and strengthening its risk control measures to boost credibility.
Also Read: Gate.io Crypto Exchange Review: Pros, Cons, and Key Features
