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Hyperliquid TGE: A look at Key Metrics and Potential of the Ecosystem
Jake Kennis
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Introduction

Hyperliquid continues to show exponential growth across many metrics, surpassing $6b in daily volume and an open interest of $2b+ on November 12th. It has recently entered the top 10 chains by TVL, commanding over $1.1b in TVL. This makes up over 54% of all USDC on Arbitrum, which is tied up in the Hyperliquid bridge and also includes spot markets of Hyperliquid-native tokens such as PURR, with these spot assets continuing to grow.

Hyperliquid is having its long-awaited airdrop in November, and Aevo is currently pricing at around $4/point. We expect this number to range because Hyperliquid is not just a perp dex but it is a fully-fledged layer 1 chain with many apps planning to launch, so many participants are speculating on where it will land but nobody really knows what to expect.

In this short note, we aim to cover its parabolic growth and potential strategies for its upcoming airdrop. Hyperliquid’s growth continues to grow relative to other perp DEXs, taking up nearly 30% of all volumes.

The core DEX they have built will serve as the core liquidity engine that can power any of the apps that launch on Hyperliquid. Through the HyperEVM, Hyperliquid will transition from being a perp/spot DEX to being a general purpose L1, where many core DeFi apps can also launch - creating a similar experience to that of a CEX, but with the advantages of tapping into onchain liquidity. Leading up to the launch dozens of teams have already announced that they plan to participate and launch across many verticals including but not limited to:

Along with the above apps, many other tools built for trading, gamblefi and many others also plan to launch.

Growth and Trajectory into TGE

Not only have Hyperliquid volumes continue to increase, but we have also seen TVL increase as shown by the nearly $853b in USDC bridged below.

Nansen Query
Source: Nansen Query

Even since the points program ended and the snapshot was announced, USDC deposits have continued to climb, showing the stickiness of the product despite concerns related to points farming.

Another interesting view is to analyze bridge activity, particularly looking at the withdrawal ratio of certain traders. In other words, we want to see traders who withdrew more than they deposited into Hyperliquid through the official bridge; hence, we can consider them profitable traders. A withdrawal ratio of 2 means a 2x, and so on - we are unsure of the activity they did to make the money but we simply want to highlight them as they are also the ones who successfully took profits and “cashed out”. Below are the top addresses, sorted by the withdrawal ratio over the last 3 months.

Source: Nansen Query

Potential Positions

The main way of betting on Hyperliquid at the moment is via PURR, the native memecoin launched by the team itself. They launched other spot markets, mainly comprising of an assortment of memes:

Hyperliquid
Source: Hyperliquid

PURR is above $138m at the time of writing and seems to be the leader, with decent liquidity/volumes compared to some of the lower-cap tokens.

Conclusion
We see Hyperliquid continuing to gain marketshare relative to other perp DEXs while continuing to rival CEXs. Thanks to its smooth UX, easy onboarding via its Arbitrum bridge, and wide range of popular tokens listed, it has become home for many onchain traders. In addition, non-traders alike can earn by depositing USDC into vaults where they can benefit from market making and liquidation strategies on the platform. With the launch of its L1, we can see many improvements in scalability and permissionless market listings for any onchain asset - this would unlock many strategic advantages vs CEXs today. Today, DEXs facilitate just under 5% of the volumes of their CEX counterparts, showing much room to grow even just in the context of the current market of crypto traders. Given the growth of the user base, volumes and new markets being launched across perps, spot, and pre-launch tokens, we see Hyperliquid positioned well for an onchain future.
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Disclosure: The authors of this content and members of Nansen may be participating or invested in some of the protocols or tokens mentioned herein. The foregoing statement acts as a disclosure of potential conflicts of interest and is not a recommendation to purchase or invest in any token or participate in any protocol. Nansen does not recommend any particular course of action in relation to any token or protocol. The content herein is meant purely for educational and informational purposes only and should not be relied upon as financial, investment, legal, tax or any other professional or other advice. None of the content and information herein is presented to induce or to attempt to induce any reader or other person to buy, sell or hold any token or participate in any protocol or enter into, or offer to enter into, any agreement for or with a view to buying or selling any token or participating in any protocol. Statements made herein (including statements of opinion, if any) are wholly generic and not tailored to take into account the personal needs and unique circumstances of any reader or any other person. Readers are strongly urged to exercise caution and have regard to their own personal needs and circumstances before making any decision to buy or sell any token or participate in any protocol. Observations and views expressed herein may be changed by Nansen at any time without notice. Nansen accepts no liability whatsoever for any losses or liabilities arising from the use of or reliance on any of this content.