In the past several months, Hyperliquid has established itself as the premier orderbook-based DEX. Its success is largely powered by its revolutionary HyperLiquidity Provider (HLP) Vault and the rising demand for its native HYPE token. At the core of the platform’s success lay its innovative approach to liquidity provision which has drawn millions of users to the platform. Apart from its airdrop-fueled popularity, its TVL and trading volume growth has been impressive.

This article delves into the economic conditions fueling Hyperliquid’s meteoric rise. It highlights the HLP Vault, reviews historical performance of the HYPE token, and explores the token’s impact on the greater decentralized finance (DeFi) ecosystem.

Disrupting the AMM Model with HLP Vault

Notably, Hyperliquid differs from most existing DEXs due to its lack of a standard Automated Market Maker (AMM) model. It accomplishes this through its trailblazing HyperLiquidity Provider (HLP) Vault. This cutting-edge practice maximizes efficiency and ecological sustainability in liquidity provision. It opens up deeper pools of liquidity to more users, all while improving net capital efficiency.

The HLP Vault, the home for HPL Depositors, lets users deposit assets and accumulate yields based on how well the platform does as a whole. Tied to the above point, in Q2 of ’25, Hyperliquid released its HLP Vault and promoted high APYs up to 17%. This audacious plan resulted in mammoth capital inflows. This attractiveness high yield + platform’s strong security measures = A green wave of TVL flooding the gates.

As of Q2 2025, Hyperliquid had exceeded $800 million in total value locked (TVL). This milestone is a testament to healthy investor market confidence and extremely fast paced platform adoption. The popularity of the HLP Vault has demonstrated an incredibly successful alternative to the typical AMM model. It provides greater returns than traditional AMMs and increases capital efficiency for liquidity providers.

HYPE Tokenomics and Market Performance

As the native liquidity provisioning token, the HYPE token is central to Hyperliquid’s economic flywheel. Yet it determines the platform’s incentive structure and dictates how its mechanisms work. In June 2025, Hyperliquid airdropped tokens to almost 94,000 wallets. That 31% of the total HYPE supply that they sent to their early users and supporters was DISTRIBUTED DIRECTLY to them! This or similar airdrop strategies encouraged adoption of the platform while creating a strong sense of community ownership.

In fact, price for the HYPE token has gone up 22.5 times since issuance. HYPE’s all-time high was $45.59, signaling an incredible market demand and investor excitement. Today, it is trading at $36.12, showing continued enthusiasm and momentum for broader trading.

As of July 2025, there were around 334 million HYPE tokens circulating. This led to an inflated circulating market cap of $12 billion for Hyperliquid. The circulating HYPE tokens are currently only one third of the max supply. The platform's fully diluted valuation hit $36 billion, underscoring the market's long-term growth expectations for Hyperliquid.

Trading Volumes and Fee Generation

Hyperliquid has shown impressive trading volumes and fee generation for several months, proving its place as a top DEX. The platform regularly recorded over $5.6 million in daily fees, highlighting its ability to attract active traders and generate revenue.

On a daily basis, HYPE trading volumes exceeded an average of USD $300 million, showcasing robust liquidity and vibrant market engagement. The platform’s efficiency is evident in its $200k+ per day of generated fees and unprecedented volumes. This makes it appealing to retail and institutional traders, as well.

As the DeFi landscape continues to rapidly evolve, Hyperliquid’s innovation gives them a strong competitive advantage. Its cutting-edge HLP Vault, robust HYPE token growth and elevated trading volumes have earned it a noteworthy presence. The platform’s success is a testament to how creative liquidity provision strategies and tokenomics can drive explosive growth. It further demonstrates the promise for wider uptake across the decentralized finance industry.