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- Hyperliquid's RWA Flywheel
Hi all, happy Tuesday! Today we break down the risk-off move in global markets, including the unusual move lower across both oil and risk assets. In addition to this, we discuss HYPE’s underperformance despite positive developments surrounding the CXMT IPO in China.
Let’s get into it.
BTC closed Monday down -2.4% amid a broader contraction following increased geopolitical and macro uncertainty. Equities, gold, and oil all ended the day in the red, an unusual alignment across these asset classes.
This underperformance comes against the backdrop of tomorrow’s FOMC meeting. After falling sharply following a cooler-than-expected CPI print two weeks ago, rate-hike odds on CME FedWatch have climbed back to just under 40%. Selling accelerated after Monday's close, when Bloomberg reported that Citadel Securities sees a surprise hike as a live possibility.
In terms of sectors, the only indices to outperform on Monday were the 2025 Crypto Equities cohort (+1.6%), the Solana Ecosystem index (+1.5%), and the Launchpad index (+0.4%).
The Perps index (-6.1%) was among the worst-performing indices on Monday, driven by a sharp decline in HYPE. While exchange metrics, covered below by Carlos, remain positive, HYPE has been pressured by a series of large unstaking requests and concerns around regulation.
A cumulative 7.4M HYPE (~$400M) is expected to be unstaked by the end of next week, including requests from funds such as Multicoin Capital. While Multicoin has clarified that this supply will not be sold and can be attributed to routine wallet management, it has nonetheless resulted in a selloff on HYPE.
— Toma
Hyperliquid’s RWA Flywheel Is Working
TradeXYZ completed another successful transition from pre-IPO price discovery to a live public market this week.
On July 14, TradeXYZ launched a pre-IPO market for CXMT ahead of the Chinese chipmaker’s debut on Shanghai’s STAR Market. For nearly two weeks before the stock began trading publicly, Hyperliquid users could gain exposure and continuously price its expected market value.
By the opening bell, the contract implied a price of roughly RMB48.20, just 2.6% below CXMT’s RMB49.50 opening print. Public pre-listing forecasts had pointed to a far wider range of approximately RMB45 to RMB75 per share, making the result a strong demonstration of pre-IPO perpetuals as a live price-discovery venue.
More importantly, CXMT is another sign that RWAs are becoming central to Hyperliquid. For the second consecutive week, RWAs were the leading category by futures volume, accounting for more than 50% of weekly volume.
TradeXYZ also ended Sunday with a record $3.76 billion in open interest, bringing total Hyperliquid open interest to $11.42 billion.
It is worth noting that TradeXYZ markets remain in growth mode, which reduces protocol fees by 90%. Base taker fees are approximately 0.9 basis points, compared with the standard 9 basis points. I doubt that changes soon. TradFi perpetuals remain early, liquidity begets liquidity, and preserving the platform’s lead is likely more valuable than maximizing near-term take rates. Even once growth mode ends, the full standard fee may not make sense for highly competitive equity and index markets.
That said, discounted trading fees do not mean this activity is lightly monetized. HIP-3 markets also contribute to priority-fee revenue as traders and market makers compete for latency and inclusion. Priority-fee revenue already exceeds 80% of direct HIP-3 trading-fee revenue on some days. Hyperliquid can therefore monetize growing RWA activity through the transaction-ordering stack while keeping headline trading fees low.
The broader takeaway is that Hyperliquid is diversifying both what users trade and how the protocol can earn revenue. Native crypto perpetuals remain the core business, but HIP-3 has expanded volume into RWA assets, priority fees monetize competition for execution and ordering, and the roughly $5.7 billion of USDC held across the ecosystem creates another significant revenue stream through yield sharing.
CXMT is the latest proof that the strategy is working: Hyperliquid is evolving from a crypto perpetuals exchange into infrastructure for a much broader set of financial markets. Shaunda will publish a deeper report on the growing importance of priority fees in the coming days, so be on the lookout.
— Carlos
The Hyperliquid Policy Center and Multicoin Capital submitted a comment letter supporting the CFTC’s proposed prediction-market framework, arguing that event contracts fall under the Commission’s exclusive federal jurisdiction and should not be fragmented across state gambling regimes. The letter highlights Hyperliquid’s HIP-4 outcome contracts as fully collateralized onchain instruments that can support prediction markets without leverage or liquidations. It recommends two changes to the final rule. First, the CFTC should formally adopt a settlement based definition of when a contract “involves” gaming or another restricted activity and provide more examples. Second, the agency should publish its reasoning after every contract review, including when it allows a market to proceed, so builders can rely on a consistent body of regulatory precedent.
Noah Goldberg of Theia explains how large investors trade MetaDAO decision markets, where pass and fail conditional tokens let participants express both governance views and relative-value trades. He outlines opportunities such as “band arbitrage” between spot and conditional prices and liquidation trades when ownership coins fall below treasury value, but says Theia’s main objective is usually to improve the underlying business rather than profiting from each market. The talk also highlights the current advantages of scale, onchain wallet analysis, negotiations between traders, and the exploitation of low-liquidity hours to influence TWAP outcomes, illustrated through Theia’s participation in Mountain Capital, Ranger, and Solomon proposals.
