Hyperliquid Launches Decentralized Exchange with Centralized Performance

Hyperliquid is recognized as the most advanced decentralized trading platform in the cryptocurrency industry. It is built on its own blockchain, designed for speed, scalability, and a seamless user experience. This allows it to combine the performance of centralized exchanges with the security and transparency inherent to decentralized financial systems. Whether new to trading or transitioning from traditional cryptocurrency exchanges, Hyperliquid offers an intuitive way to trade perpetual contracts directly from a wallet, with no middlemen, gas fees, or sign-ups.

This guide provides a complete beginner’s walkthrough on how to trade on Hyperliquid, covering everything from setting up a wallet and placing the first trade to understanding order types, risk management, and taking full advantage of the platform’s features. Hyperliquid offers a centralized exchange-like experience in a fully decentralized environment, with no sign-ups, KYC, or gas fees. Only USDC is accepted as trading collateral, and the platform supports perpetual futures with leverage and margin modes. Unlike many decentralized exchanges that rely on automated market makers, Hyperliquid has designed a completely decentralized order book.

Hyperliquid is a decentralized cryptocurrency derivatives exchange known for offering high-speed, low-latency trading without traditional intermediaries or centralized control. It presents a familiar interface similar to that of centralized exchanges but is built on its own blockchain infrastructure, enabling complete transparency, self-custody, and composability. At its core are perpetual futures contracts on a large number of cryptocurrencies, allowing traders to open both long and short positions entirely on-chain while taking advantage of tooling similar to that of centralized exchanges.

Hyperliquid is a decentralized cryptocurrency exchange with no central authority exercising control over it. It is non-custodial, meaning funds are stored on-chain and not within a centralized account or address. Users are responsible for their funds and nobody else. It also uses a first-of-a-kind decentralized order book which mimics those of centralized exchanges but with the advantages inherent to DeFi. Users do not have to register; they only need to open the Hyperliquid trading app and connect their non-custodial wallet to start trading. Thereby, users do not have to worry about lengthy KYC procedures or the potential of the exchange to freeze their funds.

Hyperliquid is built on its very own blockchain, designed from the ground up with the goal of providing all the necessary technology stacks to guarantee low latency and extremely high throughput when trading. Confirmation times are less than a second, and users receive the full-blown centralized exchange user experience on a completely decentralized system. Even though all of the transactions happen on-chain, users pay no gas fees for trading, which reduces overhead and makes the exchange a lot more effective for high-frequency traders, as well as for beginners. Hyperliquid supports both cross-margin and isolated margin modes, which is a feature typically reserved for centralized exchanges.

To trade on Hyperliquid, users will need a compatible wallet, such as MetaMask, Coinbase Wallet, WalletConnect, Rabby, and others. Once the wallet is set up, users will need to transfer some money and fund their account, a process known as “bridging.” Hyperliquid operates with USDC as trading collateral, which users will need to obtain. The Hyperliquid Bridge, powered by deBridge, facilitates this process. Users can withdraw from their account on a centralized exchange or buy crypto using MetaMask’s on-ramp credit card solutions. Once the funds are bridged, they should arrive within a couple of minutes, and users will be ready to start trading by connecting their wallet to Hyperliquid.

The supported tokens include USDC, BTC, ETH, and SOL. However, users can only use USDC as margin for trading purposes. All other assets must be swapped into USDC before deposit. Once the Hyperliquid app is open, users will need to navigate to the top right corner of the navigation menu and hit “Connect.” From there, they can select their wallet and sign the connecting transaction, which is a gasless transaction. Once connected, users can navigate to the bottom right of their interface and find the “Deposit” button. From there, they can select the chain they want to deposit from, the asset, and the desired amount. Confirm, and the funds will appear in their account within a couple of minutes.

Before placing orders, users need to be familiar with the trading interface and its layout. The interface includes a chart for monitoring the chart and switching through the different trading modes, an order book for monitoring the depth of the market, the types of orders being filled, and the trades being executed, and an order placement section for placing trades. Hyperliquid supports all of the trading orders that users would find on a centralized exchange, including market orders, limit orders, stop-limit orders, and stop-market orders. Users can also select the margin mode and adjust the leverage they want to use.

To place the first trade on Hyperliquid, users need to specify the leverage. For example, they can select 5x leverage and use 100% of their available funds to open a 5x leverage long position on HYPE/USDC. Below the “Place Order” button, users can see the liquidation price, the order value, the slippage, the fees, as well as the required margin. Once users are happy with the details, they can click “Place Order,” and the trade will be executed immediately. Users can track the position in the bottom section, and if desired, they can close it using the respective button.

Trading on Hyperliquid has been streamlined to a point where users have all the necessary tools to manage their risk effectively. The biggest risk when trading perpetual contracts with any type of leverage is getting liquidated. Liquidation is the event in which a position is forced closed because the price has reached a point in the opposite direction of the trade bias, which requires users to add collateral that they don’t have or don’t want to add. To prevent liquidation, users can use stop-limit orders and stop-market orders as effective stop-loss tools or manage their positions manually by using extra-large collateral amounts and monitoring their positions.

Trading fees are essential for those who wish to trade on Hyperliquid. The fees are based on a rolling 14-day volume and are assessed at the end of each day. Hyperliquid generates revenue through its fee model, with 97% of the fees going towards buying back HYPE tokens from the open market. Best practices for trading on Hyperliquid include starting small, especially with high leverage, using isolated margin to limit risk, understanding liquidation mechanics, and trading with a plan to avoid emotions.

Hyperliquid caters to both beginners and advanced traders. The team behind Hyperliquid has made it incredibly easy to onboard newcomers, and although there are a few hoops to jump through, the process is remarkably seamless and straightforward. Some might argue that the lack of a lengthy registration process actually makes it easier. Pros of trading on Hyperliquid include true decentralization with centralized exchange-like performance, low latency and fast execution, gasless trading, advanced trading features, a clean user interface, and strong on-chain analytics potential. Cons include a slightly steeper learning curve for absolute beginners and protocol-associated risks.