What Is Hyperliquid? A Guide to the High-Performance Layer 1

Hyperliquid is a high-performance L1 blockchain that aims to push the limits of speed and throughput in the crypto world by a wide margin. You can already experience it in its flagship product, the namesake decentralized exchange Hyperliquid. 

Read on to learn more about what Hyperliquid is, how this new Layer 1 blockchain works, and what it brings to the digital asset trading ecosystem.

What is Hyperliquid?

Hyperliquid is a high-performance Layer 1 blockchain designed for seamless, low-cost trading with fast transactions and robust security.

The flagship application on Hyperliquid you can already use is its decentralized exchange, which carries the same name as the blockchain. 

The Hyperliquid DEX lets you trade with zero gas fees, low trading fees, up to 50x leverage, and all of that’s taking place on-chain for a secure and transparent trading experience. 

There’s also the HYPE token, the network’s native cryptoasset that you can use in the governance of the network, pay gas fees with it, and stake to accumulate yield.

How Does The Hyperliquid Blockchain Work?  

The Hyperliquid blockchain works according to the rules defined in its proof-of-stake (PoS) consensus algorithm, HyperBFT. It helps nodes of this network to agree on the state of the world, which comprises all applications in this ecosystem.

In HyperBFT, blocks are also produced by validators, depending on how much of the native token they staked.

The blockchain also comprises native financial components, such as margin and matching engine state, as well as a general-purpose EVM called HyperEVM.

Meanwhile, HyperEVM is not a separate chain, as it's also secured by the same HyperBFT consensus. The team behind the chain says that this way, the EVM can interact directly with the native components of the L1, such as spot and perp order books.

These order books are two flagship applications built on this blockchain. Meanwhile, the team claims that user-built applications and native components on this chain also interact seamlessly and allow anyone to use apps, launch tokens, and trade, all in one place.

Also, Hyperliquid's developers say that HyperBFT is optimized for end-to-end latency, which measures the time between sending a request and receiving a response on this network. The team claims that thanks to the consensus algorithm, the median block time of this blockchain is now 0.2 seconds.

Developers of this blockchain claim that this network currently supports around 200,000 transactions per second.

The chain is also using its HYPE tokens in the governance process.

Hype Tokenomics

There are 1 billion native $HYPE tokens.

31% of $HYPE tokens were already distributed to the community in the Genesis Airdrop, 38.888% should be burned or distributed to the community, core contributors will take home 23.8% of the total supply, and 6% will be allocated to the Hyper Foundation budget. 

Finally, 0.3% should be distributed across community grants, and 0.012% will be distributed to the HIP-2 automated market-making (AMM) system.

How to Trade Bitcoin on Hyperliquid Using Xverse

Thanks to the addition of Bitcoin with Hyperliquid, you can now seamlessly trade Bitcoin assets on Hyperliquid by depositing Bitcoin with your Xverse wallet.

Step 1: Visit app.hyperunit.xyz and connect your existing EVM wallet. Once connected, you will receive a unique address where you can deposit Bitcoin BTC directly. This can also be done from app.hyperliquid.xyz.

Step 2: Launch any of the DeFi apps. Your choice here will depend on whether you want to just deposit or withdraw bitcoin funds from your wallets or trade BTC across spot markets.

Step 3: Finalize the transaction by either tapping on the ‘buy/sell’ button when trading spot markets; or by clicking on the ‘Review Transaction’ button when depositing/withdrawing funds on Unit, a decentralized asset tokenization layer designed for nextGen financial application.

Use your Xverse wallet to start trading Bitcoin assets on Hyperliquid.

Frequently Asked Questions

What makes Hyperliquid’s features unique?

Hyperliquid sets itself apart from other blockchains thanks to its speed and high throughput of 200,000 transactions per second. It also has its own consensus mechanism, HyperBFT, which makes the chain fast while also supporting decentralization. Additionally, it also uses its own EVM and bridge.

Can I trade bitcoin using Hyperliquid?

Yes. You can trade bitcoin using Hyperliquid by visiting app.hyperunit.xyz to deposit/withdraw BTC or purchase directly from the spot market by clicking on app.hyperliquid.xyz and searching for a bitcoin pair.

What are the use cases of Hyperliquid?

The use cases of Hyperliquid include offering the ability to trade cryptoassets across different chains on a decentralized platform, handling one-click transactions when quickly depositing or withdrawing bitcoin, staking $HYPE to generate yield, or using the token to participate in network governance.