Hyperliquid’s open interest has climbed to a record, but the trading-fee revenue the platform gets to keep has been falling at the same time.
On July 13, traders’ total leveraged positions on the venue, or open interest, rose above $11 billion, marking Hyperliquid’s highest level of 2026. Over the past 30 days, total perpetual futures volume on the platform came in near $178 billion. Including centralized exchanges, Hyperliquid now handles about 9% of global perpetual open interest, up from less than 7% at the end of May.
Revenue has moved in the opposite direction
According to DeFiLlama data cited in the report, Hyperliquid protocol revenue peaked at about $357 million in the third quarter of 2025. It then declined quarter by quarter to $295 million, $217 million and roughly $202 million in the second quarter of 2026. Even with transaction count still rising, platform revenue is down 43% from its high.
The platform’s revenue has now declined for four straight quarters.
HIP-3 changed how fees are split
The report points to Hyperliquid Improvement Proposal HIP-3 as a key reason the platform no longer keeps the full benefit of its own trading activity. Since October 2025, anyone staking 500,000 HYPE, worth about $28 million at current prices, has been able to deploy a perpetual market on Hyperliquid’s order book and keep up to half of the trading fees.
At the start of 2026, markets deployed by external developers made up just 2% of Hyperliquid perpetual volume. That share has now climbed to nearly 50%.
The revenue mix shows the effect. The share of fees paid directly back to developers, market makers and the platform’s liquidity vault accounted for only 6% of total revenue in the second quarter of 2025. A year later, that figure had reached 18%.
In the second quarter, developer fee revenue generated by front-end routing sources such as Phantom was about $16 million, and that amount was fully passed through as an external cost, according to the report.
RWA perpetuals are driving new activity
Trader inflows have been fueled by new listings on third-party markets, especially real-world asset, or RWA, perpetuals. Contracts tied to oil, gold, Nvidia, Tesla, Nasdaq 100 trackers and private companies such as SpaceX pushed open interest in the segment to a record $3.6 billion this month. That was enough to overtake bitcoin and become the platform’s largest trading market.
From July 13 to July 19, tokenized stock and commodity contracts generated $25 billion in volume, accounting for 52% of total trading for the week. That was the first time they surpassed crypto perpetuals. These contracts settle in stablecoins, have no expiry and remain tradable over weekends when the New York Stock Exchange is closed. The report noted that there are few other venues if a trader wants leveraged Nvidia exposure at 2 a.m. on a Sunday.
Trade.xyz concentration has exposed risk
The growth has been highly concentrated. Trade.xyz accounts for more than 90% of open interest under the HIP-3 framework. That means many of Hyperliquid’s headline metrics depend heavily on one deployer’s choice of oracle, margin settings and risk controls.
That risk surfaced last Monday. A large trade on a thinly traded venue before the Korean session led Trade.xyz’s SK Hynix contract to drop 19%, triggering a wave of liquidations. The firm later agreed to compensate affected users.
Buybacks have shrunk as revenue falls
Hyperliquid directs about 97% of trading fees into its assistance fund, which buys back and burns HYPE on the open market. So far, about 44.5 million HYPE have been burned from total supply.
Because buybacks are tied directly to platform earnings, the amount has fallen along with revenue. In the third quarter of 2025, the fund bought back nearly $290 million worth of HYPE. By the second quarter of 2026, that figure had dropped to about $149 million, almost half.
CoinDesk data showed HYPE trading near $55 last Friday, down 5% on the week and about 28% below its record high of roughly $77 on June 16. Based on annualized revenue of about $785 million, the token was trading at around 16 times circulating market cap earnings and about 70 times fully diluted earnings.
Over the past month, institutional holders including Multicoin Capital and Bitwise have moved large amounts of HYPE onto trading platforms.
Thin native ecosystem, plus supply and regulatory pressure
Hyperliquid’s broader ecosystem remains narrow. Of the 48 Hyperliquid ecosystem tokens tracked by CoinGecko, the report says nearly all market value is concentrated in HYPE. The second- and third-largest assets are Ethena’s USDe, at about $4.5 billion, and USDT0, at about $4 billion. Both are externally issued stablecoins bridged into the network. The biggest natively issued token is PURR, with a market capitalization of just $53 million, less than 0.5% of HYPE’s value. That leaves HYPE’s valuation tied mainly to Hyperliquid’s exchange business model rather than to a broad native application base.
Supply and regulation are adding pressure at the same time. On Aug. 6, nearly 10 million HYPE were unlocked to core contributors, worth about $550 million at current prices. Monthly unlocks are set to continue through 2027, while circulating supply stands at only 222 million HYPE.
For the week ended July 17, the HYPE spot ETF posted its first weekly net outflow since launch, at about $7 million, ending a nine-week run of inflows. The Monetary Authority of Singapore, or MAS, placed the platform on its investor alert list in late June, while the U.K. had already issued a risk warning. Executives at CME Group and Intercontinental Exchange, or ICE, have also urged the U.S. Commodity Futures Trading Commission, or CFTC, to review its commodity perpetuals business.
Competition is rising from elsewhere
Competition has also emerged from less expected corners. Just one month after brokerage Robinhood launched Robinhood Chain, decentralized trading venues in the meme-coin segment had already pushed daily liquidation volume above $600 million. By some measures, daily speculative trading activity there has overtaken Hyperliquid.
That does not mean the platform has already failed. ARK research said that, as of July 31, Hyperliquid and Pump.fun together accounted for 67% of total crypto application revenue. Grayscale has also compared Hyperliquid to Amazon Web Services, or AWS, arguing that outside developers build on top of the platform while Hyperliquid takes a cut of the trading activity.
Still, the same comparison also highlights the current issue. In the first four weeks of the third quarter of 2026, Hyperliquid generated about $45 million in total revenue. If that pace holds, quarterly revenue would come in near $150 million, extending the decline and weakening the buy-side support behind HYPE.