Original title: Hyperliquid's RWA perps boom is eating into the revenue that backs HYPE
Original author: Shaurya Malwa, CoinDesk
Original compilation: Chopper, Foresight News

Hyperliquid platform contract open interest has hit a record high, but the trading fee revenue the platform is able to retain continues to shrink.

On July 13, the total size of traders’ leveraged positions on the platform—open interest—rose above $11 billion, setting a new highest record for Hyperliquid in 2026. Over the past 30 days, the total trading volume of Hyperliquid perpetual contracts has been close to $178 billion. Now, when you include all centralized exchanges, Hyperliquid has taken on about 9% of the world’s perpetual contract open positions, whereas that figure was still below 7% at the end of May.

But platform revenue moved in the opposite direction. DeFiLlama data shows that Hyperliquid’s protocol total revenue hit a peak of about $357 million in the third quarter of 2025, then fell quarter after quarter thereafter, dropping to $295 million and $217 million in succession. In the second quarter of 2026, revenue was about $202 million. Despite a steady rise in the number of trades, platform revenue fell 43% from its high point.

Hyperliquid’s platform revenue has declined for four consecutive quarters

Hyperliquid’s improvement proposal HIP‑3 can explain why the platform is unable to retain all the profits generated by its own business. Starting in October 2025, anyone can stake 500,000 HYPE tokens (worth about $28 million at current prices) to deploy their own perpetual contract market on Hyperliquid’s order book, and they can take up to half of the trading fees.

At the beginning of 2026, markets deployed by external developers accounted for only 2% of Hyperliquid perpetual contract trading volume; now that share has approached 50%.

Income data clearly shows the impact brought by revenue sharing. Hyperliquid directly returns to developers, market makers, and the platform’s liquidity treasury the portion of trading fees they receive—in the second quarter of 2025, this accounted for only 6% of total revenue. A year later, that figure had already risen to 18%.

In the second quarter, developer fee revenue generated by front-end routers such as Phantom was about $16 million. And this amount was entirely spent as cost outflows, with nothing left behind—just passed-through transaction flow.

Trading fee flow

Traders keep pouring in, driven by new product varieties launched by these third-party markets: real-asset (RWA) perpetual contracts. Products tracking crude oil, gold, Nvidia, Tesla, and the Nasdaq 100, as well as contracts tied to companies not yet listed such as SpaceX. This month, the open-interest scale hit a new high of $3.6 billion, already surpassing Bitcoin to become the platform’s largest trading market by volume.

From July 13 to July 19, trading volume of tokenized stocks and large commodity contracts reached $25 billion, accounting for 52% of total trading volume for the week—first time surpassing crypto perpetual futures contracts. These contracts are settled in stablecoins with no expiration date, so they can be traded even on weekends when the Nasdaq is closed. If you want to trade Nvidia leveraged contracts at 2 a.m. on Sunday, there are virtually no other similar options on the market.

However, this round of growth depends heavily on a single player. Trade.xyz accounts for more than 90% of the open interest under the HIP‑3 mechanism. This means Hyperliquid’s impressive records are highly dependent on this deploying party’s oracle configuration, margin parameter settings, and risk-control capabilities.

Last Monday, the hidden risks of this model became visible: before the Korean market opened, a low-liquidity trading platform saw a large trade, which directly caused a 19% plunge in Trade.xyz’s SK Hynix contract, triggering a large number of liquidations. Afterward, the institution agreed to compensate the affected users.

Hyperliquid injects about 97% of trading fees into a support fund. The fund repurchases and burns HYPE tokens in the open market. To date, it has burned roughly 44.5 million HYPE tokens out of the total supply. The repurchase amount is directly linked to platform revenue: when revenue declines, the repurchase scale shrinks as well. In the third quarter of 2025, the fund repurchased HYPE worth nearly $290 million; in the second quarter of 2026, the repurchase size was about $149 million—nearly cut in half.

CoinDesk data shows that last Friday, the HYPE quote was close to $55, down 5% over the week. Compared with the historical high of about $77 on June 16, the drop was about 28%. Based on annualized returns of about $785 million, the token corresponds to a circulating market-cap P/E ratio of roughly 16x; after full dilution, the P/E ratio is about 70x.

Over the past month, institutional holders such as Multicoin Capital and Bitwise have already transferred large amounts of HYPE tokens to trading platforms.

Hyperliquid’s ecosystem is actually very thin. Of the 48 Hyperliquid ecosystem tokens tracked by CoinGecko, almost all market value is concentrated in HYPE. The second- and third-largest tokens are Ethena’s USDe (about $4.5 billion) and USDT0 (about $4.0 billion), both stablecoins issued externally and bridged in. The largest token issued natively by the platform is PURR, with a market cap of only $53 million—less than 0.5% of HYPE’s market cap. The market’s valuation of HYPE mainly comes from Hyperliquid’s trading platform business model itself, rather than a rich native application ecosystem.

The value of the Hyperliquid ecosystem is concentrated in HYPE

Token supply faces pressure from regulators at the same time. On August 6, nearly 10 million HYPE tokens were unlocked to core contributors—worth about $550 million at current prices. Future unlocks will continue monthly until 2027, while the total circulating supply of HYPE is only 222 million tokens.

As of the week of July 17, the HYPE spot ETF saw net outflows for the first time since its launch, with a scale of about $7 million, ending nine straight weeks of inflows. The Monetary Authority of Singapore (MAS) added the platform to its investors’ risk-warning list at the end of June. The UK had also issued risk warnings earlier. Executives from CME and ICE have also urged the U.S. CFTC to review its commodity perpetual contract business.

Competition also emerged from an unexpected direction. Broker Robinhood launched Robinhood Chain just one month ago. In the meme coin sector, the decentralized exchange platform’s daily clearing volume has already surpassed $600 million. Under some reporting definitions, its daily speculative trading activity is already higher than Hyperliquid’s.

Of course, all of the above does not mean the platform has already failed. ARK Research shows that as of July 31, Hyperliquid and Pump.fun together accounted for 67% of total revenue from crypto applications. Grayscale once compared Hyperliquid to Amazon AWS: external developers build products on the platform, while the platform takes a cut from all trading activity.

But this analogy actually points to the existing problem. In the first four weeks of Q3 2026, Hyperliquid’s total revenue was about $45 million. If that pace continues, this quarter’s total revenue would approach $150 million, realizing a fourth consecutive quarter of revenue declines. At the same time, the buying power supporting the HYPE token would weaken further.

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