Question 1

How does Hyperliquid work?

Accepted Answer

Hyperliquid operates as a decentralized perpetual exchange on its custom Layer 1 blockchain (HyperEVM), combining an on-chain order book with cross-margining to enable high-speed derivatives trading. It processes up to 100,000 orders per second using HyperBFT consensus, achieving sub-second finality for real-time execution. The platform supports leveraged trading (up to 50x) and decentralized price feeds via oracles updating every three seconds.

Question 2

Is Hyperliquid a secure platform?

Accepted Answer

Hyperliquid employs a proof-of-stake consensus with a two-thirds validator quorum, though past incidents revealed vulnerabilities in concentrated validator pools. The platform has since enhanced security with stricter liquidation protocols, open interest caps, and anomaly detection systems. Users retain full asset custody, reducing custodial risks associated with centralized exchanges.

Question 3

How to use Hyperliquid?

Accepted Answer

Users connect to Hyperliquid via EVM-compatible wallets (e.g., MetaMask, Trust Wallet) or email, then deposit USDC on Arbitrum or BTC to fund accounts. Trading involves selecting perpetual contracts (e.g., BTC-PERP), setting leverage, and executing order types like market/limit orders. Cross-margin functionality allows collateral reuse across positions, while isolated margins protect individual trades.

Question 4

What services does Hyperliquid offer?

Accepted Answer

Hyperliquid specializes in perpetual futures trading with 100+ pairs, offering spot, pre-launch contracts, and margin trading with up to 50x leverage. The platform features community-owned liquidity vaults (HLP) for market-making and staking rewards. Additional services include API integration for algorithmic trading and a decentralized clearinghouse for transparent position management.