Hyperliquid Surpasses dYdX With 60% Market Share In 2024

Hyperliquid, a high-performance L1 trading blockchain, has recently achieved a significant milestone by surpassing dYdX in trading volume, reaching $1.5 trillion. This accomplishment is particularly noteworthy given that Hyperliquid's platform was launched in 2023, making it much newer compared to dYdX, which has been active for five years. Despite its shorter operational history, Hyperliquid has managed to capture more than 60% of the perpetuals trading market and has seen its HYPE token hit a 3-month high.

Hyperliquid's success can be attributed to several factors. Unlike dYdX, which relied on cash incentives to boost its volumes, Hyperliquid focused on functionality, word-of-mouth, and product quality. This approach has proven to be more durable, especially in a peak year for crypto perpetuals trading like 2024. Additionally, Hyperliquid directs a significant portion of its trading fees towards token buybacks, which has helped repurchase 17% of the total circulating HYPE tokens. This strategy has provided several key advantages, including long-term stability and a steadily rising market cap, which is nearing $10 billion.

However, Hyperliquid's journey has not been without controversies. The platform has faced major scandals, including denying claims of a Lazarus Group security breach and delisting JELLYJELLY in response to a short squeeze. These incidents led to significant backlash, but Hyperliquid has acted quickly to rebuild its reputation, which seems to have worked so far. The platform recently reached a new all-time high in open interest, surpassing $8 billion, indicating a strong momentum that could help it build a commanding lead over the DeFi's perpetuals market.

In summary, Hyperliquid's strategic approach to token buybacks and focus on product quality has enabled it to surpass dYdX in trading volume and achieve a market cap nearing $10 billion. Despite facing controversies, the platform has shown resilience and continues to gain traction in the crypto perpetuals trading market.