The Current Status and Future Outlook of Hyperliquid and HyperEVM Ecosystems

More than two months ago, the $JELLYJELLY event sparked a divergence of opinions in the market regarding the future of Hyperliquid. Some believe that Hyperliquid will repeat the mistakes of FTX, while others remain optimistic about its prospects.

Recently, the price of $HYPE broke through 44 dollars, reaching a historical high. Since the massive operations by James Wynn, the continuous rise of Hyperliquid and its token $HYPE seems to have shaken off the previous gloom and opened a new chapter of development.

Against the backdrop of strong performance of $HYPE, the HyperEVM ecosystem is also gradually developing and growing. So, how do the builders of the HyperEVM ecosystem view this ecosystem? How does Hyperliquid + HyperEVM differ from other similar models? From a market capitalization perspective, is $HYPE overvalued or undervalued?

Hyperlend Project Introduction

Hyperlend can be seen as a lending protocol within the Hyperliquid ecosystem, being a project that is officially authorized to run the latest code on HyperEVM. It provides lending services, allowing users to use $HYPE as collateral for borrowing. Additionally, Hyperlend also supports flash loan functionality, enabling users to execute various strategies based on it.

In addition to basic features, Hyperlend is also positioned as "Hyperliquid Financial Infrastructure," providing basic liquidity channels, on-chain risk management mechanisms, and other asset collateral credit limits that dApps can access. By simplifying complexity and providing deep, composable liquidity, Hyperlend aims to become the preferred yield layer on Hyperliquid, where users can earn returns on idle assets and obtain leverage for any strategy.

Currently, Hyperlend is focused on introducing new features for the Hyperliquid ecosystem, such as tokenizing the HLP vault. Users can deposit into the HLP vault through Hyperlend and receive a tokenized "voucher" representing their deposit. This token can be used as collateral on Hyperlend to borrow stablecoins, allowing users to leverage more funds and deposit more into the HLP vault to achieve higher returns.

Additionally, Hyperlend is exploring the possibility of using perpetual contract positions as collateral, aiming to overcome the limitations of long-term holdings not being able to exert more influence on centralized exchanges. Users will be able to open positions on Hyperlend, which will be genuinely created on Hyperliquid through code, while also obtaining a tokenized certificate representing the position. This way, if one wants to establish a long position or short position in Bitcoin, they can borrow stablecoins using the position as collateral while maintaining the open position.

Impact and Handling of the $JELLYJELLY Event

Regarding the $JELLYJELLY event, Hyperlend co-founder believes that the Hyperliquid team may not have fully considered or overlooked those meme coins that were launched on the platform but had low liquidity. Nonetheless, the team's handling of this incident was very quick and responsible.

This event has instead strengthened confidence in the HLP treasury. Since its launch, the treasury has generated over 60 million dollars in total revenue, which is difficult for other market-making treasuries to achieve. Currently, the treasury has also set two different risk parameters, making it more robust than before.

Overall, the Hyperliquid team has demonstrated a high level of professionalism, and their decisions are made with user interests in mind.

Comparison of Hyperliquid with Other Platforms

On the surface, the combination of Hyperliquid + HyperEVM is similar to that of other high-performance exchanges + supporting smart contract networks, but there are fundamental architectural differences between them.

Hyperliquid has chosen a "transparency first" strategy: every transaction, fund movement, and settlement is executed directly on-chain, leaving an immutable public audit record. In contrast, certain platforms keep their order books and risk control engines closed within servers, making it impossible for outsiders to independently verify their order depth or solvency.

HyperEVM is the unique execution layer of Hyperliquid, built with precompiled contracts and interactive code interfaces. These precompiled features allow any developer to access Hyperliquid's complete order book with just one call. Liquidity is no longer a "walled garden" but has become a "public asset"; on-chain strategies no longer need to access centralized-level depth indirectly through wrapped assets or fragmented AMMs.

This architectural choice brings combination capabilities that other platforms do not possess. For example, a BTC-USDC perpetual contract can be opened directly from the smart contract of HyperEVM and tokenized into an asset similar to ERC-721. This position itself becomes a movable collateral—can be transferred over-the-counter, used in lending protocols like Hyperlend, or packed into structured products without the need to close the position. On some platforms, perpetual contracts can only be locked within the exchange, unable to be withdrawn, transferred, or re-staked on-chain.

Due to HyperEVM natively routing orders to Hyperliquid, the capital efficiency is preserved. Whether it's the treasury, bots, or ordinary users' wallets, only one contract interaction is needed to obtain the "maximum amount that the order book can provide," thereby eliminating the common basis risk and slippage associated with on-chain derivatives. In contrast, on other chains, developers must simulate liquidity through AMM or rely on off-chain market makers, leading to increased latency and a more complex system.

The Current Status and Future Prospects of HyperEVM

As the performance of HyperEVM continues to improve, enabling it to handle more transactions or increase the Gas limit, it is likely that more and more people will become interested in trading meme coins or other similar assets. The Hyperliquid community is very cohesive, and it is highly probable that popular meme coins belonging to HyperEVM will emerge in the future.

Recently, due to an increasing number of people trading meme coins on HyperEVM, a large number of transactions are being sent to small blocks. These small blocks have a gas limit of only 2 million, which means the number of transactions each block can accommodate is very limited, and once filled, higher gas fees must be paid.

To solve this problem, the Hyperliquid team quickly made adjustments, shortening the block time for small blocks from the previous 2 seconds to 1 second, which allows more transactions to pass through faster and also helps reduce Gas pressure.

As long as the community provides feedback, HyperEVM will continue to improve and grow. The Hyperliquid team is always working hard to help the community and provide support as much as possible. Although they have their own development path, when the voice of the community grows louder, the team will still step up to listen and help everyone.

Market Valuation of $HYPE

From a market capitalization perspective, $HYPE may currently be undervalued. Even when compared only with other public chain coins, $HYPE still has at least 5 times the room for growth. If the value of the exchange is added to the token, this space could be even larger.

Hyperliquid is repurchasing approximately $3 million worth of HYPE every day, which amounts to about $1 billion in buy volume annually. If this momentum continues, the market capitalization of $HYPE could reach an astonishing level by the end of this year.