Hyperliquid's Recent Surge in Public Interest and Trading Activity: A Long-Term DeFi Investment Assessment

The decentralized finance (DeFi) landscape in 2025 has witnessed a seismic shift, with Hyperliquid emerging as a dominant force in the perpetual derivatives market. Amid rising speculation and surging trading activity, investors are scrutinizing whether Hyperliquid's rapid growth translates into sustainable long-term value. This analysis evaluates Hyperliquid's market performance, technological innovations, and competitive positioning while addressing critical risks that could shape its trajectory.

Hyperliquid's Explosive Growth: Metrics and Market Share

Hyperliquid's trading volume and user base have grown at an unprecedented pace. In July 2025 alone, the platform processed $330 billion in trading volume, briefly surpassing centralized platforms like Robinhood. By year-end, its cumulative perpetual futures volume reached $2.74 trillion, matching Coinbase's activity. Daily trading volumes averaged $15.6 billion, with open interest peaking at $133.5 billion.

User adoption has also accelerated, with 825,000 daily active addresses and 3.65 million monthly active users according to data. This growth is underpinned by a robust ecosystem, including staking protocols like Kinetiq and Pendle, which contributed $372 million in TVL to Hyperliquid's HLP vault by mid-2025. However, Hyperliquid's market share on decentralized perpetual platforms has faced headwinds. While it dominated with 73% of volume in early 2025, this dropped to 38% by late 2025 due to the rise of competitors like Aster.

Competitive Landscape: Hyperliquid vs. Emerging Rivals

Hyperliquid's dominance is challenged by platforms such as Aster, Lighter, and EdgeX. Aster, for instance, saw explosive growth in early 2025, peaking at $70 billion in daily volume and 50% market share. However, its volume metrics were later questioned for artificial inflation, as they closely mirrored Binance's activity. Lighter and EdgeX, meanwhile, leveraged low fees and institutional-grade infrastructure to attract users, though their open interest remains significantly lower than Hyperliquid's according to analysis.

Hyperliquid's competitive edge lies in its infrastructure. Its custom Layer 1 blockchain, HyperBFT, enables sub-second finality and 200,000 transactions per second. The HyperEVM layer, launched in February 2025, further expands its ecosystem by supporting smart contracts. Analysts note that Hyperliquid's open interest-accounting for 62–63% of the Perp DEX ecosystem in Q4 2025-reflects its superior liquidity and institutional credibility.

Governance and Innovation: Drivers of Long-Term Viability

Hyperliquid's governance model is a key differentiator. Proposals like HIP-1 and HIP-3 allow permissionless market creation and token listings, fostering adaptability. HIP-1 introduced a governance-based token listing mechanism, while HIP-3 enables perpetual markets for diverse assets, from cryptocurrencies to equities according to research. These innovations position Hyperliquid to compete with both traditional and decentralized platforms.

The platform's deflationary mechanisms also bolster token value. A buyback and burn fund allocates 93% of protocol fees to HYPE token holders. By mid-2025, TVL had surpassed $5 billion, with open interest reaching $15 billion according to reports. This financial resilience is further supported by institutional partnerships, including collaborations with BlackRock and Stripe, and SEC-approved ETF applications according to market analysis.

Risks and Regulatory Challenges

Despite its strengths, Hyperliquid faces significant risks. Regulatory scrutiny remains a critical concern, particularly as U.S. authorities intensify oversight of DeFi platforms. A $4.9 million loss from manipulative bidding in late 2025 highlighted vulnerabilities in its security framework. Additionally, the decline in market share to 38% underscores the need for continuous innovation to retain liquidity providers and traders.

Conclusion: A Promising but Volatile Proposition

Hyperliquid's technological infrastructure, governance flexibility, and institutional partnerships position it as a formidable player in the DeFi ecosystem. Its ability to maintain high open interest and adapt to competitive pressures suggests long-term potential. However, regulatory risks, security challenges, and the volatile nature of DeFi markets necessitate caution. For investors, Hyperliquid represents a high-growth opportunity but requires careful monitoring of both macroeconomic trends and platform-specific developments.