Hyperliquid Surpasses Ethereum in 7-Day Revenues

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Hyperliquid has officially outperformed Ethereum in seven-day revenue.

According to DeFiLIama data, Hyperliquid generated roughly $12.8 million in protocol income for the week ending Feb. 3. This is more than the $11.5 million revenues that Ethereum generated during the same period.

This revenue sheds some light on the spectacular rise of Hyperliquid and Ethreum’s struggle to sustain its dominance in the face of newer and more agile platforms.

Key Drivers for the Rapid Hyperliquid Growth

Launched in 2024, Hyperliquid’s meteoric rise is driven by its flagship product, a perpetual futures (perps) exchange, which is becoming the preferred venue for derivatives trading. Perpetual futures are a sort of derivative contract that allows traders to bet on the future price of an asset, without an expiration date. It subsequently provides ongoing trading opportunities.

As of Feb. 3, Hyperliquid was processing an astonishing $470 million in daily transaction volume, doubling its figures from the beginning of the year. The platform’s popularity is the result of its combination of ultra-low fees, a trading experience comparable to centralized exchanges, and the high levels of transparency achieved through its implementation of blockchain technology.

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These features have helped Hyperliquid grab a remarkable 70% market share in the perps trading arena, surpassing established competitors like GMX and dYdX, according to a January research report from asset management giant VanEck.

Ethereum Faces Challenges Due to Declined Revenues and Rivals

As Hyperliquid thrives, Ethereum faces a growing number of obstacles. Despite maintaining a daily transaction volume of approximately $4.7 billion, Ethereum earnings have decreased after the Dencun upgrade in March 2024, which reduced transaction fees by an estimated 95%.

Though lower costs tend to attract more users, Ethereum has failed to create sufficient transaction volume to offset the decline in income. Matthew Sigel, Head of Digital Asset Research at VanEck, noted this and said in the research report, “There wasn’t enough volume to make up for the fee decline”.

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Adding to Ethereum challenges in the growing threat from other layer-1 blockchains such as Solana, which has risen to prominence in the decentralized exchange (DEX) field. In January, Solana’s daily DEX trade volume was more than double the activity on the Ethereum network. Solana’s volumes reached $8.9 billion while Ethereum only posted volumes of $4 billion.

HYPE Token Gains Traction

The native token of Hyperliquid, HYPE, was launched via an airdrop in November 2024 and has been a main catalyst for the platform’s accelerated adoption. Since its launch on Nov. 29, HYPE has surged by over 500%, with a fully diluted valuation of over $25 billion as of Feb. 3, according to CoinGecko.

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Despite its market success, VanEck cautions that Hyperliquid’s smart contract ecosystem is still in its early stages, with limited developer participation. This could pose long-term difficulties if the platform fails to expand its operations beyond derivatives trading.

Author

Steven Walgenbach

Steven's passion for cryptocurrency and blockchain technology began in 2014, inspiring him to immerse himself in the field. He notably secured a top 5 world ranking in robotics. While he initially pursued a computer science degree at the University of Texas at Arlington, he chose to pause his studies after two semesters to take a more hands-on approach in advancing cryptocurrency technology. During this period, he actively worked on multiple patents related to cryptocurrency and blockchain. Additionally, Steven has explored various areas of the financial sector, including banking and financial markets, developing prototypes such as fully autonomous trading bots and intuitive interfaces that streamline blockchain integration, among other innovations.

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