# The Watch List: Hyperliquid _How are revenues holding up in a "risk-off" environment?_ January 23, 2026 • Michael Nadeau --- # The Watch List: Hyperliquid ## How are revenues holding up in a "risk-off" environment? Michael Nadeau January 23, 2026 Hello readers, We believe perpetual futures represent an important innovation that will ultimately lead to an evolution in derivatives market structure — shifting from fragmented, expiry-based contracts to continuous, funding-driven markets. This model is particularly well-suited for trading macro assets such as FX and interest rates (some of the largest markets globally) — where traders primarily seek *exposure* rather than ownership. We also expect RWAs to come onchain first through perpetual futures, as this structure avoids many of the frictions associated with tokenization, custody, transfer agents, and corporate actions. Hyperliquid, a perpetual futures DEX and emerging L1 ecosystem, is purposely built from first principles to bring these advantages onchain. In this week’s report, we share an update on Hyperliquid’s recent performance, including progress on the build-out of the HyperEVM Layer 1 blockchain. [As a reminder, you can click the link under each chart to access the data dashboard supporting this week’s report.] Topics covered: - [Perps DEX financials](#perps-dex-financials) - [Perps DEX fundamentals](#perps-dex-fundamentals) - [HyperEVM fundamentals](#hyper-evm-fundamentals) - [Token Economics](#token-economics) - [Valuation](#valuation) - [Relative Performance](#relative-performance) - [Closing Thoughts](#closing-thoughts) ***Disclaimer:**** Views expressed are the author’s personal views and should not be relied upon as investment advice. * Let’s go. # Perps DEX Financials ##### Fees [Data: The DeFi Report](https://dune.com/the_defi_report/hyperliquid?utm_source=thedefireport.beehiiv.com&utm_medium=referral&utm_campaign=the-watch-list-hyperliquid) - 365-day fees = $915m - 90-day fees = $230m - 30-day fees = $57m Perps trading accounts for about 97% of fees, while spot trading accounts for just 3%. ##### Takeaway Fees on the Hyperliquid perps DEX have come down, but not nearly as fast as we’ve seen on Solana, and its leading applications. For example, in Q4, Hyperliquid did $270m in fees (down 16% from Q3). Solana’s REV was down 60% over the same period. As for the top apps on Solana over the same period? - Raydium: down 79% - Jito: down 76% - Axiom: down 61% - Jupiter: down 37% - Pump Fun: down 19% In a risk-off environment where interest in crypto has fallen off a cliff, Hyperliquid is holding up quite well relative to other top networks and apps. This is unique, especially for a “high-flyer” app experiencing its first bear market. ##### Buybacks [Data: The DeFi Report](https://dune.com/the_defi_report/hyperliquid?utm_source=thedefireport.beehiiv.com&utm_medium=referral&utm_campaign=the-watch-list-hyperliquid) Over the last year, Hyperliquid has used 93.3% of its fees on HYPE buybacks, totaling $854m ($2.3m/day). ##### Takeaway If Hyperliquid can maintain its user base during a bear market, the steady bid on the token could help offset any elevated selling pressure, pointing to a shallower “cycle low” than we would typically see from a new project in its first bear market. More on token economics and team unlocks later in the report. # Perps DEX Fundamentals ##### Open Interest [Data: The DeFi Report](https://dune.com/the_defi_report/hyperliquid?utm_source=thedefireport.beehiiv.com&utm_medium=referral&utm_campaign=the-watch-list-hyperliquid) Open Interest on Hyperliquid is currently just under $10 billion, down from a peak of $15.8 billion in August of last year. Binance, the largest centralized perps exchange, currently has $29b of open interest, after peaking at $44.5 billion in early October of last year. In terms of its decentralized counterparts: - Aster Open Interest = $2.5b - Lighter Open Interest = $1.2b - Drift Open Interest = $247m - Jupiter Open Interest = $181m ##### Takeaway In just over a year, Hyperliquid has captured a significant portion of the centralized perps exchange market (34% of Binance’s open interest and 54% of CME crypto futures open interest). Meanwhile, it has more than double the open interest of its top four decentralized competitors. ##### Active Addresses [Data: The DeFi Report](https://dune.com/the_defi_report/hyperliquid?utm_source=thedefireport.beehiiv.com&utm_medium=referral&utm_campaign=the-watch-list-hyperliquid) At its peak, the Hyperliquid perps DEX was adding roughly 2,600 new users/day. Over the last 30 days, that figure has dropped to roughy 1,600 new users/day (down 38%). The number of new addresses may seem low, but it aligns with our understanding of unit economics in crypto trading markets. A small subset of highly active traders tend to pay the bills. The key thing to watch for is how this holds up in a bear market. ##### Perps Volumes Data: The DeFi Report, Blockworks Research Over the last 30 days, Hyperliquid has averaged $5.2b in futures volume/day — down from roughly $9.8b/day at its peak (down 47%). Interestingly, RWAs are currently driving the third-highest volume, behind BTC and layer 1s. More on this later in the report. ##### Takeaway The larger decline in futures volume (relative to fees) indicates that liquidation fees may be filling the gap. For reference, the DEX processed over $90b in liquidations on October 10th of last year, generating over $10m in fees (nearly 2x the second-most profitable day for Hyperliquid). ##### Spot Volumes Data: The DeFi Report, Blockworks Research At its peak, Hyperliquid was doing roughly $820m/day in spot volumes. Over the last 30 days, it’s averaging $127m/day (84% decline). Spot volumes accounted for roughly 3% of Hyperliquids total fees over the last 365 days. ##### Bridged Value [Data: The DeFi Report](https://dune.com/the_defi_report/hyperliquid?utm_source=thedefireport.beehiiv.com&utm_medium=referral&utm_campaign=the-watch-list-hyperliquid) Hyperliquid currently has over $4.1b of value on the DEX. This is down from a peak of $6b in September of last year. For reference, Solana’s TVL is currently $8.7b. Since inception, over $318b of value has been deposited for trading, with $314b withdrawn. # HyperEVM Fundamentals Hyperliquid is unique in that it started as a Perps DEX. But it’s also a layer 1 blockchain. In this section, we provide an update on the nascent but emerging HyperEVM. ##### REV [Data: The DeFi Report](https://dune.com/the_defi_report/hyperliquid?utm_source=thedefireport.beehiiv.com&utm_medium=referral&utm_campaign=the-watch-list-hyperliquid) Since its inception (Feb. of last year), the HyperEVM has generated $8.9m in REV. Over the last 30 days, it’s averaging just $11.7k/day, which is down from a peak of $66k/day. On 10/10 of last year, the protocol generated $450k in fees. In terms of TVL, the Hyperliquid L1 currently has just under $1.2b of value secured. Kinetiq, a liquid staking protocol, has over $500m. Morpho (lending) has over $300m. And HyperLend (lending) has over $240m. ##### Active Addresses [Data: The DeFi Report](https://dune.com/the_defi_report/hyperliquid?utm_source=thedefireport.beehiiv.com&utm_medium=referral&utm_campaign=the-watch-list-hyperliquid) Over the last 30 days, the L1 is averaging roughly 12k unique active addresses/day. That’s down from a peak of roughly 20k/day in September/October of last year. ##### DEX Volumes [Data: The DeFi Report](https://dune.com/the_defi_report/hyperliquid?utm_source=thedefireport.beehiiv.com&utm_medium=referral&utm_campaign=the-watch-list-hyperliquid) In terms of DEX volumes, the L1 is averaging $62m/day over the last 30 days — a drop in the bucket compared to Ethereum and Solana. ##### Stablecoin Supply [Data: The DeFi Report](https://dune.com/the_defi_report/hyperliquid?utm_source=thedefireport.beehiiv.com&utm_medium=referral&utm_campaign=the-watch-list-hyperliquid) As of 1/21/26, there are now over $674m stablecoins on the Hyperliquid L1. The recent growth can be attributed to Circle (USDC) deploying on Hyperliquid and establishing a 50% market share. Tether has 21% of the stablecoins on Hyperliquid, Paxos has 12%, and Ethena has 11%. # Token Economics This section covers the HYPE token — which represents interest in the Hyperliquid perps DEX + the L1. Max Supply: 1,000,000,000 Released Supply: 395,494,480 - Core Contributors: 22.3m - Hyper Foundation: 60m - Genesis Air Drop Distribution: 310m - HIP-2: 120k - Community: 3m ##### Token Allocation - Genesis Airdrop: 31% - Future Emissions & Community Rewards: 38.88% - Core Contributors: 23.8% (unlocks began in November 2025 and end in November 2027) - Hyper Foundation Budget: 6% - Community Grants: 0.3% - HIP-2 (Hyperliquidity): 0.012% ##### Unlocks Team unlocks started in November of last year. The protocol is currently releasing 9,916,666 HYPE tokens per month to the team ($213m/month at current HYPE prices) through November of 2027. Hyperliquid does not have venture support, so there are no investor unlocks. ##### Buybacks Buybacks have averaged $1.7m/day over the last 30 days (79k HYPE/day). At this rate, roughly 2.3 million HYPE are removed from the supply/month, or 28 million HYPE per year. ##### Takeaway Hyperliquid’s buyback program puts a solid bid on the token, but team unlocks are currently over 4x the amount of buybacks/month. Of course, if user activity declines, buybacks will follow suit. More on the “buyback yield” below. # Relative Performance [Data: The DeFi Report](https://dune.com/the_defi_report/hyperliquid?utm_source=thedefireport.beehiiv.com&utm_medium=referral&utm_campaign=the-watch-list-hyperliquid) Since inception, HYPE is up 71% vs BTC. From April through September of last year, it outperformed BTC by 278%. That said, from its peak in September, HYPE has *underperformed *BTC by 52%. For reference, ETH is down 21% vs BTC over that period, and SOL is down 47% vs BTC. # Valuation HYPE is currently trading at a fully diluted value of $20.5b. With 365-day fees at $915m, that’s a fully diluted price/sales ratio of 22.4x (down from 66x in August). In terms of circulating price/sales, it comes in at 7.1x (down from 21.9 in August). This is now below what we would typically see for high-growth tech/fintech (8-16x). ##### Buyback Yield The analysis differs from traditional tech/fintech due to Hyperliquid’s buybacks — because the revenue they earn isn’t being hoarded by the company (with a fiduciary duty to investors). Instead, it’s buying back the HYPE token. 365-day buybacks = $854 million. With a circulating market cap of $6.5 billion, the current implied “buyback yield” is 13.1%. This means that Hyperliquid repurchased the equivalent of 13% of its market cap over the last 365 days. However, this doesn’t account for new token issuance/unlocks — which are currently exceeding buybacks by over 4x. # Closing Thoughts We think perpetual futures are likely to become the dominant *user-facing abstraction* for trading macro financial assets — especially FX and rates. Furthermore, it’s much easier to onboard and trade RWA derivatives than tokenized stocks/bonds themselves (tokenized assets require custody, transfer agents, corporate actions, dividends, etc. — perps avoid all of this). The key risk today is regulation, and whether Hyperliquid/decentralized solutions will make it into the U.S. crypto market structure bill. It’s our view that Hyperliquid itself may not be regulated, but the consumer interfaces to it will be. With that said, Hyperliquid is *winning*. We think there are five primary reasons why: - A great product with UX on par with centralized exchanges, yet allows for self-custody. - The best inception story since BTC and ETH: 31% of the token supply was airdropped to early users, creating billions in wealth and a loyal, loud online community. - Fantastic token economics and alignment with users & token holders. - A talented, mission-driven founding team. - Early integrations with popular wallets (Phantom) and trading apps (Axiom). Hyperliquid is becoming the default “perps trading” infrastructure across the crypto landscape today — allowing users to trade from friendly interfaces while leveraging Hyperliquid under the hood. HYPE is currently on *The Watch List.* If you’d like to access our price targets and be notified when we add it back to our portfolio, you can sign up for TDR Pro [here](https://thedefireport.io/upgrade?utm_source=thedefireport.beehiiv.com&utm_medium=referral&utm_campaign=the-watch-list-hyperliquid). Take a Report. And Stay Curious. ***Disclaimer****: Individuals have unique circumstances, goals, and risk tolerances, so you should consult a certified investment professional and/or do your own diligence before making investment decisions. The author is not an investment advisor and may hold positions in the assets covered. Certified professionals can provide individualized investment advice tailored to your unique situation. This research report is for general educational purposes only, is not individualized, and as such should not be construed as investment advice. The content contained in the report is derived from both publicly available information as well as proprietary data sources. All information presented and sources are believed to be reliable as of the date first published. Any opinions expressed in the report are based on the information cited herein as of the date of the publication. Although The DeFi Report and the author believe the information presented is substantially accurate in all material respects and does not omit to state material facts necessary to make the statements herein not misleading, all information and materials in the report are provided on an “as is” and “as available” basis, without warranty or condition of any kind either expressed or implied.*