Most tech giants in the 2000s built their infrastructure and product as one entangled unit. Amazon had the foresight to separate out AWS as an API layer, of which Amazon retail was the first of many users. Today, AWS generates more profit than all of Amazon's other business lines combined.
Hyperliquid is built with the same philosophy. Housing all of finance requires thoughtfully designed, open financial primitives. Each primitive should obey the Unix principle of "Do one thing and do it well." Talented builders then have the foundation to chain these together to create magical applications.
HyperCore borrowing is an example to highlight this philosophy in action.
Most other platforms implement portfolio margin by marking an account's collateral to market value with an LTV haircut, creating borrowed assets without an explicit lender. This system is simpler to implement, but misses a golden opportunity for composability.
Hyperliquid instead begins with a borrow/lend protocol on HyperCore. Every borrowed asset is sourced from a supplier, so risk is isolated within the borrow/lend primitive instead of platform-wide. HyperCore's portfolio margin system is implemented as an orchestration layer that composes borrow/lend, with other primitives such as perps, spot, and outcome trading.
This decomposition has several nice corollaries:
1. Today's announcement of manual borrowing is not a new feature, but simply an extension of the underlying primitive. Borrowers on day one have access to 400M and growing of supplied liquidity.
2. Portfolio margin users earn interest on their idle stablecoin collateral. This is not a new feature, but a natural byproduct of composing trading with lending.
3. System safety is easier to reason about when perp and borrow/lend margining are independent.
In the same way that math theorems almost prove themselves when the right abstractions are defined, composable designs just feel right.
On July 27 at 23:01 UTC, SKHYNIX mark price dropped from $1,127.9 to $917.25. This print was based on an executed trade which was relayed by multiple independent data providers. The XYZ oracle was live in external pricing and tracking that venue, which serves as the primary Korean pre-market venue. The oracle system worked as intended according to its specification.
While the system performed as designed, users are understandably upset about liquidations that were triggered. Market integrity is among Trade[XYZ]'s core values, and we understand the trust of our users has been, and will continue to be, earned.
With these values in mind, we have decided to cover liquidation losses attributable to this anomaly. Eligibility requirements will be conveyed soon, and distributions are anticipated to be completed in the coming days. This is a one-time discretionary decision and is not a guarantee of similar future action.
Going forward, our pricing systems will be further improved to handle tail events. We are accelerating our review of how prices are formed, including revisiting assumptions on external venues, and taking into consideration the price formation which occurs on our own orderbooks, which carry increasingly meaningful depth and signal in relation to external sources.
We will share further information soon.
Africa's largest crypto exchange will power their core perps offering directly using Hyperliquid's onchain liquidity. This is a major milestone that will redefine how the next generation of financial applications are built.
The breakthrough of cloud computing was that any startup could quickly test their idea, with the comfort that the infrastructure would scale with their business. As the most liquid global venue for assets such as BTC, Hyperliquid will play the same role in the global economy. By tapping into the deepest onchain liquidity, builders can instead focus on their product and users.
Huge congratulations to the VALR team. We are honored that they chose to build on Hyperliquid. Excited to scale together!
Excited to see everyone come together for this historic moment. AQAv2 brings the protocol-aligned stablecoin model that @Nativemarkets trail-blazed to USDC with @Coinbase and @Circle's commitment to Hyperliquid. The community no longer has to choose between liquidity and alignment.
Our industry will face adversity as we continue to grow. It gives me hope seeing titans of the industry come together to build for users and bring all of finance onchain.
The only takeaway from the Star vs CZ drama is we will never know who's correct. CEXs are a black box, who are reluctant to publish their balance sheet, profitability, and best practices in the event that there are drawdowns in reserves due crashes.
With Hyperliquid you don't have to guess. You don't have to hope they're telling the truth.
You can indepedently verify yourself.
This is why it's so important that you move your volume to a platform pushing for more transparency in an industry that desperately needs it.
Hyperliquid has quietly achieved an important milestone of becoming the most liquid venue for crypto price discovery in the world. See below for side by side comparison of BTC perps on Binance (left) and Hyperliquid (right).
With HIP-3 teams leading the way, Hyperliquid has also grown to become the most liquid venue for perps on tradfi assets. Thank you to everyone's hard work as we upgrade the financial system and house all of finance.