Hyperliquid launched its USDH stablecoin as rival StandX hit $200 million in TVL, fueling competition in the $6 trillion monthly derivatives market.
Hyperliquid’s founder, Jeff Yan, took to X to dismiss rumors that the platform is focused on protocol revenue, labeling them pure FUD. He said that recent ADL events have proven profitable for users, producing hundreds of millions of dollars in total gains. A backstop liquidation mechanism, he stated, might have raised more HLP revenue, but it would have also amplified risk.
He remarked, “On 10/10, Hyperliquid ADLs net made users hundreds of millions of dollars by closing profitable short positions at favorable prices. If more positions had been backstop liquidated, HLP could have made hundreds of millions of dollars more in pnl, while being exposed to an irresponsible amount of risk. ”
He added that the ADL mechanism is structured to allow users to capture profits that might otherwise go to the system, all while reducing risk.
Meanwhile, ARK Invest CEO Cathie Wood praised Hyperliquid’s potential, comparing it to Solana’s early-stage promise, calling it “the new kid on the block.” She described the project as exciting and reminiscent of Solana’s formative years, noting that “Solana has proven its worth and is, you know, there with the big boys,” during a recent interview on the Master Investor podcast.
Wood did not reveal any position in Hyperliquid but described the protocol as one to watch. Her comments come as competition among perpetual futures DEXs has intensified since Aster launched a token this month, driving its trading volume and open interest to surpass Hyperliquid’s.
Jeff said the ADL queue on Hyperliquid works much like those used by CEXs
Jeff noted that Hyperliquid’s ADL queue follows the same logic as many centralized exchanges (CEXs), combining leverage and unrealized pnl to determine the order of deleveraging.
He thanked users for their feedback on ADL, adding that while valuable, many suggestions, such as offsetting correlated positions, would add extra complexity to the system. He highlighted that other major venues don’t typically employ a more complex ADL queue design, and simple systems are generally more resilient and easier for users to grasp.
In late September, the exchange debuted its native stablecoin USDH, which traded nearly $2 million during the opening period. The stablecoin, backed by cash and U.S. government securities, leverages Stripe’s Bridge platform to manage reserves. Previously, the exchange had already slashed its spot trading fees by 80% as it sought to increase liquidity ahead of the stablecoin’s debut.
The USDH ticker race began on Sept. 5, after Hyperliquid opened a governance process to decide the issuer. Native Markets arrived early, promising to issue a stablecoin on HyperEVM and allocate the reserve’s income between HYPE buybacks and ecosystem development.
Soon after, bids rolled in from Paxos, Sky, Frax Finance, Agora, Curve, OpenEden, BitGo, and Ethena — the latter eventually withdrawing and backing Native Markets’ proposal.
StandX’s TVL has crossed $200 million mark
Meanwhile, Hyperliquid’s rival StandX smashes through the $200 million total value locked (TVL) within one month – now a world record for the platform. In addition to the milestone, StandX announced the kickstart of StandX Alpha, where early users are rewarded simply for signing up. The project was created by former members of Binance’s derivatives team and is designed to merge synthetic stablecoins with a decentralized perpetual exchange model.
In a Saturday X post, Stand X announced, “New ATH achieved: $200,000,000 TVL in one month. StandX Alpha just went live. Stand in early for potential rewards.”
Despite rising competition, Hyperliquid has become the newest fixation of both crypto traders and Wall Street. Designed for perpetual futures, it has already outperformed Coinbase in certain areas, despite being far smaller than it and Binance, while handling volumes within an industry that now exceeds $6 trillion a month.
Tarun Chitra, founder of Gauntlet, recently noted that the highest growth rates are occurring in the newest and least established markets, largely because most existing participants have yet to understand their purpose.
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