Author: David Christopher
Original Title: Hyperliquid & The Year Perps Caught Fire
Compiled and Edited: BitpushNews
The frenzy around perpetual contract exchanges swept through 2025, and Hyperliquid led the charge. As competition intensifies, can it maintain its lead?
Looking back at the crypto industry's growth in 2025, Hyperliquid is an unavoidable focal point.
The exchange ended 2024 with an epic airdrop and price performance, drawing massive attention from Crypto Twitter back to the product.
By the end of 2025, it had completely transformed—becoming a paradigm-breaking platform, ranking fourth in revenue across the entire crypto ecosystem with total revenue exceeding $650 million, and at one point capturing 70% of the perpetual contract trading volume.
(Data Source: Token Terminal)
If you haven't been tracking Hyperliquid's every move, this breakthrough success might seem to have come out of nowhere. But its path to conquest was the product of meticulous design, unconventional growth strategies, and well-deserved external recognition.
Here is a complete review of Hyperliquid's journey through 2025 (and why it will be truly tested in 2026):
Q1 2025: The Crypto-Native Edge
Hyperliquid's year of rapid growth began with a stark reminder of what it means to be truly in tune with the industry.
When the TRUMP token launched in January, Hyperliquid listed perpetual contracts almost immediately, beating other exchanges to the punch and kickstarting its winning streak as the "go-to venue for pre-launch token trading."
Of course, its ability to move fast was because it wasn't hindered by the "corporate guardrails" that large exchanges use to protect users and the company.
But a key factor was its firm "inside knowledge"—its team is deeply intertwined with on-chain dynamics, able to spot opportunities and recognize the advantage of being first to list these tokens. This solidified Hyperliquid's reputation as the preferred place to trade new assets before the established giants could react.
In February, HyperEVM was released—a general-purpose smart contract layer built on top of HyperCore (Hyperliquid's exchange engine). Although it took some time to find its footing, its success came without any top-down incentive programs. This meant that when it gained traction in Q2, it had already built a core user base who stayed not for "farming" rewards, but because they believed in the chain's vision and wanted to leverage its unique features (like interoperability with HyperCore), rather than just extracting incentives.
Q2 2025: The Breakout
Market attention came faster than most expected. Besides the HYPE token rising nearly 4x from its April lows, by May Hyperliquid captured 70% of all on-chain perpetual trading volume—a staggering figure for a platform with zero VC backing and zero token incentives.
The HYPE token's highs, the explosive growth of HyperCore activity, and the development of the HyperEVM ecosystem all spread the Hyperliquid story.
As the market came back to life, Hyperliquid's smooth user experience (UX) and deep liquidity captured a massive order flow, with total trading volume climbing to $1.5 trillion.
As mentioned, HyperEVM also hit its stride simultaneously, with its Total Value Locked (TVL) growing from $350 million in April to $1.8 billion by mid-June, fueled by the launch of projects (like Kinetiq, Felix, and Liminal) and users exploring new earning opportunities—all while continuously burning HYPE tokens in the background.
Amid this rapid growth, Hyperliquid seemed to be everywhere.
It appeared on national TV, was covered by Bloomberg, and became a focal point in CFTC policy discussions. This exchange became impossible to ignore.
Q3 2025: Peak Momentum and the Beginning of Fragmentation
Q3 began with a signal that Hyperliquid's infrastructure was becoming indispensable even outside its own ecosystem.
Phantom wallet bypassed Solana-based perpetual platforms, choosing to integrate Hyperliquid via builder codes. Builder codes are a Hyperliquid mechanism that allows external platforms to earn fees by routing trades to HyperCore.
Rabby followed suit. Then MetaMask.
A wave of mobile trading apps went live via builder codes.
In total, through these integrations, "partners" have earned nearly $50 million in fees, routing $158 billion in trading volume.
(Data Source: Hyperscreener)
Then, in September, the USDH bidding war erupted—revealing just how valuable and prominent Hyperliquid had become.
The issue was simple: Hyperliquid held about 8% of Circle's USDC supply in its bridge, leaking roughly $100 million in annual yield to a direct competitor (Coinbase), while Hyperliquid's own ecosystem couldn't recapture these earnings. Launching a native stablecoin could solve this, potentially redirecting $200 million in annual revenue back to Hyperliquid.
A proposal for issuing a stablecoin was invited, and heavyweights joined the bidding.
Ethena offered a $75 million growth commitment and institutional partnerships. Paxos dangled PayPal and Venmo integrations, even getting PayPal to tweet about Hyperliquid.
But ultimately, Native Markets won the bid—a team led by respected HYPE contributor Max Fiege, former Uniswap Labs COO MC Lader, and Paradigm researcher Anish Agnihotri.
Why did a smaller, less capitalized team beat these giants? Because they were more favored, more aligned with Hyperliquid's ethos: bootstrapped, aligned in goals, and ready to build something truly genuine—just like Hyperliquid itself was built.
The ripple effects extended beyond Hyperliquid itself. MegaETH soon announced its own native stablecoin plans. Sui followed suit in November.
However, USDH also marked the peak of the HYPE token in mid-September—and the moment competition began to show. Aster (a Binance-backed exchange supported by CZ) and Lighter (an Ethereum L2 perpetual platform) both launched with aggressive airdrop campaigns. Trading volume continued to fragment, Hyperliquid's market share split, standing at just 17.1% at the time of writing.
(Data Source: @uwusanauwu | Dune)
Q4 2025: Maturation and Growing Pains
In October, the long-awaited HIP-3 went live, enabling permissionless listings on HyperCore, driving the exchange's expansion and decentralization.
Anyone staking 500,000 HYPE can now deploy custom markets, such as:
-
Equity perpetuals from Unit's Trade.xyz and Felix Protocol
-
Perpetual markets using yield-bearing collateral like sUSDE from protocols like Ethena
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Markets offering synthetic exposure to private companies like SpaceX or Anthropic via platforms like Ventuals
However, despite the HIP-3 launch, the HYPE token price fell nearly 50% from its September peak.
Why? Besides market conditions and competition, two things stood out.
First, this quarter Hyperliquid experienced its first ADL (Auto-Deleveraging) event in over two years. During the market crash on October 10th, over-leveraged positions drained margin faster than the liquidation engine and HLP (Hyperliquid Liquidity Provider) could absorb. The protocol triggered over 40 auto-deleveragings in 12 minutes, forcibly reducing the most profitable positions to rebalance the books. While some argued the affected positions were still "closed in profit," others contended the mechanism liquidated more than necessary to cover the bad debt. Yes, the system remained solvent without external capital injection, but Hyperliquid, like the broader market, might need time to recover from this event.
Second, in November, team token unlocks began. Although the total unlocked was lower than expected, this vesting schedule likely also contributed to HYPE's underperformance. The sell-off volume was small—only 23% went to OTC desks, while 40% was re-staked—but the pace of future unlocks remains unclear. My interpretation is the core team might still be finalizing the schedule to balance contributor fairness with ecosystem health. But for a protocol known for transparency and "honesty," this ambiguity might cause market unease.
Hyperliquid's first unlock released 1.75 million HYPE after the lock-up period ended, but the pace of future team unlocks hasn't been fully disclosed.
The Perpetual Proving Ground
Despite the cooling market and trading activity, we shouldn't overlook the profound evolution the perpetual ecosystem has undergone alongside Hyperliquid's own development when trying to understand Hype's underperformance.
Lighter and Aster are just two examples of on-chain competition. Although their volumes might be inflated by airdrop hunting, they do offer real alternatives.
In the off-chain realm, Coinbase's perpetual product will soon compete with Robinhood's moves in this space. As perpetuals continue going mainstream, more competitors will emerge.
In other words, Hyperliquid is in its proving phase, and it will continue into 2026.
The question isn't whether it truly had a remarkable 2025—it did. The question is, as the space gets crowded, can this exchange prove that its path to growth through integrations like builder codes and decentralized models like HIP-3 still holds an advantage.
What got them here was building a better product and a better ecosystem, without taking shortcuts. What keeps them ahead will be doing it all over again.
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