Boccaccio

This is a segment from the 0xResearch newsletter. To read full editions, <a href="https://blockworks.co/newsletter/0xresearch" target="_blank" rel="noreferrer noopener">subscribe</a>.



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BTC sits at $110K as of this morning, with the vast majority of tokens down – except for Hyperliquid (up 14% from yesterday’s $43 lows) and Solana (up 4% today).&nbsp;



We’ve already covered Hyperliquid twice this week, so I’ll spare the details. Here’s a quick recap:



<ul class="wp-block-list">
<li>Perpetuals volumes are up and to the right.</li>



<li>Spot volumes are up and to the right.</li>
</ul>



More interestingly, we saw (potentially) His Excellency, Justin Sun, make an appearance in the pre-launch order books on the platform. A <a href="https://t.co/3GwjI3FdHb">wallet</a> associated with Justin Sun longed millions of XPL on Hyperliquid, clearing the entire order book and liquidating many who thought they were safe to hedge their pre-deposit allocations at a 10x. A good warning for future “safe 1x shorts” who want to lock their profits in.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXfsf8N00E3NbsM_SVy-o1ShzsUvTnRo3IgwApT6LnqGrBhEjWcqmhsYd-irsjBsBivzL7ALFuG8_88j_YCEwvDQ2BvzISKD-Zvs81n6MAn1sVOeBCnLoTL8mB3Po1R69lFFADNcNw?key=24jEXQBKGptAXbEYHVO1JQ" alt=""/></figure>



We’re also finally seeing some relief on Solana after months of underperformance against ETH. Recent DAT announcements seem to have not been particularly private and were sold into pretty heavily (likely also due to the market downturn). Since then, the wunderkind of 2023-2024 has rebounded. We’ll have to see if the treasury companies will lead to any open market buys, or if they’re mostly in-kind. Even if they are mostly in-kind, given that SOL’s market cap is much smaller than that of ETH, we might see some positive price action if:



<ul class="wp-block-list">
<li>The SOL DATs can put forward a figure who can compete with Mr. Thomas Lee.</li>



<li>They are putting in at least a little bit of cash into the vehicles.</li>
</ul>



Unfortunately, despite being bullish on SOL throughout most of 2023 and 2024, it is difficult to not feel like the tide has moved against it, especially with memecoin activity increasingly taking the attributes of a <a href="https://en.wikipedia.org/wiki/Euthanasia_Coaster">euthanasia roller coaster</a> (Trump into Melania into Milei into <a href="https://blockworks.co/news/yzy-memecoin-last-thing-crypto-needs">Kanye West</a>). We’ll have to see who wins:



<ul class="wp-block-list">
<li>Ethereum, Thomas Lee and DATs</li>



<li>Solana, memecoins and gambling</li>



<li>Hyperliquid and infinite buybacks</li>
</ul>



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<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Crypto news and analysis to start your day.</li>



<li><a href="https://blockworks.co/newsletter/forward-guidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/supply-shock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
</ul>

Hyperliquid

Memecoins’ ‘euthanasia coaster’ and a new Telegram bot entrant

David Canellis

This is a segment from the Empire newsletter. To read full editions, <a href="https://blockworks.co/newsletter/empire" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Like all good things, it turns out that killer apps come in threes.



Polymarket, Hyperliquid, pump.fun. These are the voyages of modern-day crypto enterprise.



And before you tell me that stablecoins are crypto’s fourth killer app, thereby ruining this airtight metaphor: No.&nbsp;



Stablecoins are a tool. Wallets are apps (but only barely). I will die on this hill.



For the sake of being pedantic, let’s separate Circle, with its <a href="https://blockworks.co/news/circle-ipo-price-execution-stablecoins">wildly successful IPO</a>, into a separate category: “fintech on the blockchain.”



There’s suddenly no question that Polymarket, Hyperliquid and pump.fun are the sole victors of this cycle.&nbsp;



Hyperliquid won perps, pump.fun won memecoins (although Bonk.fun <a href="https://app.blockworksresearch.com/analytics/launchpads">made it close</a>), and Polymarket won the concept of betting on random stuff. Polymarket had its <a href="https://blockworks.co/news/polymarket-performs-smoothly-on-election-day">breakthrough moment</a> during the US election, so it tracks that Donald Trump Jr’s 1789 Capital recent investment has cemented its status.&nbsp;



CNBC <a href="https://www.cnbc.com/2025/08/26/polymarket-secures-investment-from-trump-jr-backed-1789-capital.html">reports</a> the deal ranged in the double-digit millions, with Don Jr. also joining the firm’s advisory board.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Pleased to announce that my fund <a href="https://twitter.com/1789Capital?ref_src=twsrc%5Etfw">@1789capital</a> has invested in <a href="https://twitter.com/Polymarket?ref_src=twsrc%5Etfw">@Polymarket</a> and that I will be joining the team as a Strategic Advisor. Prediction markets have completely changed the way people follow the news. I&#39;m proud to support the industry and look forward to helping… <a href="https://t.co/C3QlMEKQFe">https://t.co/C3QlMEKQFe</a>&mdash; Donald Trump Jr. (@DonaldJTrumpJr) <a href="https://twitter.com/DonaldJTrumpJr/status/1960367380724351416?ref_src=twsrc%5Etfw">August 26, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



A longstanding criticism of the crypto space is that it’s too insular. That it’s all decentralized infrastructure for degenerate gambling apps, in one form or another. Crypto’s endless servicing of speculation largely overshadows the utility of peer-to-peer payments and freely accessible tokenized dollars.



Now, I don’t agree with that summation, but it exists, persistently so. And the fact that the current breakthrough apps express different degrees of degeneracy won’t do much to change that perception — Hyperliquid with its leverage of up to 40x; pump.fun with its gamified memecoin launches; Polymarket with its pop-culture wagering.



I have a theory that crypto is, for the most part, years ahead of the mainstream. Crypto knew that blockchain-powered prediction markets were interesting seven years ago, when Augur launched on Ethereum in 2018, causing <a href="https://www.newsweek.com/welcome-augur-cryptocurrency-death-market-where-you-can-bet-donald-trump-1043571">moral panic</a> over the potential for assassination markets and so on.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Not a very consequential thing, but kinda funny: a Polymarket user named &quot;romanticpaul&quot; (yes, his real username) started aggressively buying Taylor Swift to be engaged starting yesterday afternoon around 3pm. He nearly doubled the price from a 25% chance (this year) to 45%. You… <a href="https://t.co/IXVRqj0eB6">pic.twitter.com/IXVRqj0eB6</a>&mdash; Domer❤️‍🔥 (@Domahhhh) <a href="https://twitter.com/Domahhhh/status/1960394729176105077?ref_src=twsrc%5Etfw">August 26, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Do we need to bet on celebrity romance? No. Is it fun? Yes.



Bookies have obviously been taking bets on obscure stuff like the next James Bond or celebrity deaths long before crypto. But Augur, Polymarket and all the others have added immediacy to the mix — letting the public open the markets rather than the bookies themselves.&nbsp;



Anyone paying attention to sports betting would know that gambling on anything and everything would be the next evolution. And perhaps Bored Apes re-primed the normie-sphere for its next big arbitrary collectible in <a href="https://blockworks.co/news/labubus-succeeded-nfts-failed">Labubus</a>, some three decades after Tomagotchis and Beanie Babies ran wild.



With this in mind, 1789 Capital’s bet is clearly a solid one, even if Polymarket is what Russ Hanneman would call “<a href="https://www.youtube.com/watch?v=BzAdXyPYKQo">pre-revenue</a>,” in that it doesn’t collect any fees (yet), apparently subsisting only on venture capital money like the cash just raised from Don Jr, now amounting to hundreds of millions of dollars.



And for all of its pesky <a href="https://www.dlnews.com/articles/people-culture/bettors-say-some-polymarket-prediction-outcomes-are-gamed/">problems</a> with market resolutions, it’s certainly fitting that a crypto-native outfit in Polymarket could be a primary venue for mainstream degeneracy moving forward.&nbsp;



It all begs the question: Is there more money to be made by looking outward from crypto rather than inward, like Hyperliquid and pump.fun?&nbsp;



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXexJwFpr4mDV_hj8_jhEL05r_khSbMNJg33Ox-udU4moa1kZo3dmECJs1wqMy0m11gEwlc8fLQRmd0mcbCDTzN1va-qmcrjoLUq5b6WFeBX2hoqmFUFstbVjOxe4C1s5bzw3O7Szw?key=cfCdTcmo1Yyyag1GX4K42Q" alt=""/></figure>



Hyperliquid has averaged more than $55 million onchain monthly revenue over the past six months and pump.fun nearly $33 million, per <a href="https://app.blockworksresearch.com/analytics/application-comparison">Blockworks Research</a> data.&nbsp;



That’s far below a mainstream app like <a href="https://ir.roblox.com/news/news-details/2025/Roblox-Reports-Second-Quarter-2025-Financial-Results/default.aspx">Roblox</a> (currently about $360 million per month), but about in line with <a href="https://www.businessofapps.com/data/discord-statistics/">Discord</a> (around $50 million per month in 2023). Polymarket has otherwise seen over $1 billion in monthly trading volume for three months running, and is on track for a fourth in August. A hypothetical 5% fee would give it $50 million in monthly revenue right away, although perhaps a withdrawal fee might be easier to stomach.



In any case, it’s easy to make the argument that crypto and blockchain are worthwhile regardless of whether they only ever amount to reconstructing the traditional financial system to be more transparent and trustless, outside of the penchant for gambling.&nbsp;



But Polymarket is getting close to crossing the culture chasm in a way that Bitcoin, Ethereum and Solana never have. Those may be household names, but they’re still “crypto.”&nbsp;



Polymarket might just be “Polymarket.”



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<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/supply-shock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
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dApps

Polymarket is close to crossing the culture chasm

Carlos

This is a segment from the 0xResearch newsletter. To read full editions, <a href="https://blockworks.co/newsletter/0xresearch">subscribe</a>.



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Hyperliquid&#8217;s spot volumes have seen a significant rise, particularly when compared to CEXs. Over the weekend, an unknown entity deposited and sold ~22.1k BTC to rotate into ~555k ETH, valued at over $2.4 billion. This surge in spot volumes positioned Hyperliquid as the second-highest exchange by BTC spot trading volume on Aug. 24, with a 12% market share, behind only Binance (38%). This is a substantial increase from Hyperliquid’s 30-day average daily market share of ~1%.&nbsp;



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXdsk-ZAc7HsJHIz0pRska_YD8_kAqICQPFfzrt6uCcVUx0ITaim5198QmbwzN7R6yux7Jcw4L7_QwrDHMMg4sOBdJ8mHDcGEVPnFPSXd2Go8ZKIJbwVMGKwUSXPnWkaAQElQj18NQ?key=jez8q95NO0rdPaI3OWQE3w" alt=""/></figure>



Stepping back, we can compare Hyperliquid&#8217;s monthly spot trading volumes against various CEXs (including all assets, not just BTC). We observe a consistent rise in Hyperliquid&#8217;s share of spot volumes year to date. This month, Hyperliquid accounted for 38% of Kraken&#8217;s spot volumes, 16% of Coinbase, 15% of OKX, 14% of Bybit, and 2.4% of Binance. Although all figures represent a significant rise from the beginning of the year, they also show that Hyperliquid still has a long way to go to flip some of the largest CEXs.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXd7r0MBZfnxDz2VWXbc-c_nu1VPzA70bS92X2gho4a6CUsBPU_cJJ682VNOhqoQGQWOLXECy3IZtgcsASZDPcre0N4aRgox-WLJGC0xHrMrXHXlG4q0MwZZzmqIJNFn4p1mrG2WJw?key=jez8q95NO0rdPaI3OWQE3w" alt=""/></figure>



Regarding perpetual futures volumes, Hyperliquid has been growing significantly faster than its centralized counterparts. The chart below shows that the ratio between Hyperliquid&#8217;s perp volumes and that of the three largest CEXs has increased by more than 6x over the past year. Hyperliquid&#8217;s monthly perps volumes now represent almost 14% of Binance&#8217;s futures volumes, up from just 2.2% a year ago.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXeZiT1Nv8S8UYoU8_qrbrTazNkavr7Swv46wKiHM97KurI3sFHvmc9zeeqbvESHTU4Q3fj7PeX5RL3wVjTq-S9NUMk6cg7TekS6IOOpCwDphZkCHNU1GaahPXjz9UqfEwX1CWddtA?key=jez8q95NO0rdPaI3OWQE3w" alt=""/></figure>



Growth in volumes is impressive. But what about revenue, especially as it compares to other chains? Hyperliquid (HyperCore + HyperEVM) has registered about $28 million in weekly revenue for two consecutive weeks, and $98 million in the past 30 days. These figures translate to an annualized revenue run rate of $1.2-$1.4 billion. Below, we see that Hyperliquid has been the top chain by weekly revenue in the last two weeks, achieving a new all-time high market share of 36%.&nbsp;



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXfS0M5yEQO62_WT60qckG5hoBoM1n9bJxYyz3zFaI3V8ZncYIyk_kAIDsE1epjilv6gPJ9SmnylYwqbhvAs_hSUstcFql-DOset2WGVmLD1LMMjNlBc-A9qsstPgsgPy-Xe2Ax5Ag?key=jez8q95NO0rdPaI3OWQE3w" alt=""/></figure>



The chart below shows that HYPE is the cheapest asset among the leading chains on a price-to-sales basis, with its P/S of 12 representing a 90% discount to the cohort. Even on an FDV/sales basis, HYPE is also the cheapest L1. While we can do mental gymnastics all day long about whether L1s merit a premium or not, or if they should be valued based on revenue or not, the fact remains that HYPE today looks more attractively priced than all other L1s, based purely on this metric.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXcgHvLcDocsd9-sYVCCgDyEODO98Dbfv_t_QZUntUXTNBBbT476HFz7rxLXOTr7yJ12xSWKuJT0KWLB4NjUKnE3QPL0z5oFcYKgjHVc2-rjKxzGze4zaFMtMf6HCb2-mbf9ax7E4g?key=jez8q95NO0rdPaI3OWQE3w" alt=""/></figure>



Ask yourself, what happens if the so-called &#8220;L1 premiums&#8221; wear off? What happens when buying pressure from DATCOs subsides? Is it the case that HYPE is undervalued, or simply that other L1s have incredibly elevated valuations that are becoming increasingly harder to justify? We can&#8217;t know for sure, but these are certainly questions worth thinking about.



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<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/supply-shock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
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0xResearch Newsletter

Either HYPE is still cheap or most L1s are overvalued

Donovan Choy

This is a segment from the Lightspeed newsletter. To read full editions, <a href="https://blockworks.co/newsletter/lightspeed">subscribe</a>.



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We learned this week that Stripe and Circle are planning to launch their <a href="https://blockworks.co/news/stripe-circle-l1s-solana">own L1 chains</a>.



Ethereum community members were quick to <a href="https://x.com/ryanberckmans/status/1955289483345113471">question</a> why corporations shouldn&#8217;t launch L2s instead.



Ethan Buchman has a simple <a href="https://blockworks.co/news/circle-l1-impact-ethereum">explanation</a>: Vertical integration is profitable.



Christian Catalini of Lightspark <a href="https://www.forbes.com/sites/christiancatalini/2025/08/11/stripe-is-building-a-blockchain-can-openness-survive-branded-rails/">echoes</a> this view in Forbes:



“&#8230; stablecoin issuers have strong incentives either to commoditize the rails — by issuing on multiple networks and positioning themselves at the center of interoperability across them — or to nudge most activity to a network they control. Either strategy gives them a shot at becoming massive global fintech leaders and capturing most of the value the technology creates.”



Circle/Stripe is doing simply what’s best for them. But that means these new chains aren’t contributing to Ethereum data availability fees, which does not elevate the bags of ETH token holders.



The team behind Phantom wallet faced similar “chain alignment” questions upon announcing its integration of Hyperliquid perps.



This as opposed to a perps DEX built on Solana like Drift or Jupiter.



Reasoning from a viewpoint of chain tribalism is pretty standard fare in this industry. But from an outsider’s perspective, it’s probably a very weird mental model to make decisions from. Builders should simply do whatever’s best for business.



Brandon Millman, CEO of Phantom, puts it plainly on this week’s Lightspeed <a href="https://youtu.be/ogdTMLHMRy8">podcast</a>:&nbsp;



“In the world of trading and perps, how do we get the best prices for users? If you just look at the objective numbers, price, execution, liquidity…all of that is an order of magnitude greater on Hyperliquid. And so by completely ignoring that, I think we would&#8217;ve been doing a pretty big disservice to users.”



To put it another way, Hyperliquid processed $371 billion in volumes over the last 30 days. Solana&#8217;s two largest perp DEXs, Jupiter and Drift, processed a collective $52 billion over the same time.



That’s roughly 7.1x more addressable volume, which should lead to a pretty straightforward business decision.



From my time speaking to application developers in the industry, most pursue a multichain strategy simply because it’s best for business.



Aave for instance, is deployed on something like 15 chains. This multichain strategy is proving unprofitable on several L2s like Soneium, Celo, Linea, ZKsync and Scroll. So they won’t do it <a href="https://x.com/DefiIgnas/status/1951238740526993611/photo/1">anymore</a>. Another simple straightforward decision!



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">We reached an L2 saturation point: Aave deployed on 16 chains, but the new deployments are operating at a loss (Soneium, Celo, Linea, zkSync, Scroll). As a result, Aave is unlikely to deploy on Bob BTC L2, even though it passed the temp check vote. Now, a proposal on the Curve… <a href="https://t.co/jl6FKICbOk">pic.twitter.com/jl6FKICbOk</a>&mdash; Ignas | DeFi (@DefiIgnas) <a href="https://twitter.com/DefiIgnas/status/1951238740526993611?ref_src=twsrc%5Etfw">August 1, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



It would be nice for businesses to show cultural loyalty or be altruistic.



But as the economist-philosopher Adam Smith taught us, it’s not from the benevolence of the butcher, baker or brewer that we expect our dinner from, but from a regard to their own self-interest.



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<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Crypto news and analysis to start your day.</li>



<li><a href="https://blockworks.co/newsletter/forward-guidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/supply-shock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
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Circle

Corporations don’t care about your blockchain

This is a segment from the 0xResearch newsletter. To read full editions, <a href="https://blockworks.co/newsletter/0xresearch" target="_blank" rel="noreferrer noopener">subscribe</a>.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



The 13-year-old design software company Figma IPO’d on the NYSE yesterday.



As I write this edition, Figma’s stock is trading at $115. That’s a ~250% pop from its $33 opening price — above Circle’s June <a href="https://blockworks.co/news/circle-shares-nyse-day-one">IPO pop of 168%</a>, and far above the average 17% day-one IPO pop of past decades.



Great success! But according to the Crypto Twitter commentariat, that’s “<a href="https://x.com/j0hnwang/status/1950957474359488614">legalized theft</a>.”



Specifically, theft by the investment bankers from the retail public.



The general idea underlying this criticism is that:



Investment banks deliberately underprice IPOs below fair value, then allocate shares to their preferred hedge funds and clients. These guys flip them for an easy profit at the expense of unsophisticated retail investors that naively buy into the IPO hype once the stock is already trading higher.



Retail investors lose because IPO offer prices are determined by private markets (as opposed to, say, Hyperliquid pre-launch perps that allowed price discovery pre-PUMP ICO).



Plus they <a href="https://x.com/nearcyan/status/1951012496380404021">don’t</a> get to buy in early — Wall Street does.



This status quo isn’t all that different to memecoins.



Recall the Javier Millei-affiliated <a href="https://blockworks.co/news/libra-latest-solana-memecoin-episode">LIBRA memecoin launch</a> in February. As my colleague David Canellis <a href="https://blockworks.co/news/libra-memecoin-sausage-gross">wrote</a>:&nbsp;



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">
&#8230; anyone launching a memecoin in 2025 must fight against unseen forces that nobody has figured out how to beat: onchain snipers who will bid up fresh memecoins at the drop of a hat, only to dump them soon after on anyone buying into the pump they created, usually killing the project in the process.
</blockquote>



It was kind of an open secret in crypto anyway.



But in TradFi, it’s all perfectly legal as per capital market rules. Namely, the Securities Act of 1933, which forces companies to lock in a fixed public offer price before trading.&nbsp;



Like the genesis of most government regulations, the Securities Act wasn’t intended to enrich Wall Street at retail’s expense: It started out as well-meaning and targeted real abuses by bucket shop salesmen in the 1930s.



But today’s capital market laws hard-wire pricing power and share-allocation discretion into the traditional IPO.



<h2 class="wp-block-heading">Project Crypto</h2>



SEC Chair Paul Atkins unveiled yesterday <a href="https://www.sec.gov/newsroom/speeches-statements/atkins-digital-finance-revolution-073125">Project Crypto</a>, an initiative <a href="https://blockworks.co/news/sec-chair-atkins-project-crypto">meant to achieve</a> “President Trump’s vision of making America the crypto capital of the world.”



It reads almost like a Christmas wishlist for the industry: most crypto assets will not be securities, create exceptions and safe harbors for ICOs and airdrops, protect software engineers, protect self-custody, make onchain software part of securities markets, etc.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">The SEC&#39;s new &quot;Project Crypto&quot; is the most bullish thing I&#39;ve seen in a long time from a regulator. Read the speech, it&#39;s incredible: * Almost all tokens are not securities * Want to discourage decentralization kabuki theater * Americans should not get excluded by IP/VPN blocks…&mdash; Haseeb ＞|＜ (@hosseeb) <a href="https://twitter.com/hosseeb/status/1950966199116009656?ref_src=twsrc%5Etfw">July 31, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



But the devil’s always in the details.



And no one scrutinizes the details, except for the lobbyists and lawyers at the policymaking table.



How will this wishlist interact with existing laws? What will they morph into 10 or 50 years from now?



No one knows — just like how no one could’ve expected the Securities Act of 1933 to enable “legalized theft” today.



Government regulations are bad not because they were badly designed or that policymakers are evil per se, but because they are created and exist in a set of institutions that are static.



We like to think of the “government” as a precise machinery that voters can modulate to create laws that thwart specific problems. We like to think the government would remove laws that are deemed bad.&nbsp;



But democracy is more messy in practice. In reality, policymakers are saddled up with special interests, and uninformed voters dominate elections.



It’s what economist Mike Munger calls a “<a href="https://fee.org/articles/unicorn-governance/">unicorn problem</a>.”



Atkins’ words today are a breath of fresh air in the post-Gensler era. But don’t be surprised when today’s rules eventually harden around whoever learns to game them best. It’s just politics.



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Imagine if Figma’s IPO had Hyperliquid’s pre-launch perps

This is a segment from the 0xResearch newsletter. To read full editions, <a href="https://blockworks.co/newsletter/0xresearch" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Phantom wallet announced yesterday that it was integrating Hyperliquid perps right into its wallet interface.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Introducing: Phantom Perps 👻 ♾️ Go long or short in just a few taps. 100+ markets. Up to 40x leverage. All in your pocket. Powered by <a href="https://twitter.com/HyperliquidX?ref_src=twsrc%5Etfw">@HyperliquidX</a> <a href="https://t.co/YDKjUGBdEn">pic.twitter.com/YDKjUGBdEn</a>&mdash; Phantom (@phantom) <a href="https://twitter.com/phantom/status/1942628993636917311?ref_src=twsrc%5Etfw">July 8, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



This is <a href="https://x.com/hyperliquidbull/status/1942630523408351446">surprising</a>, mainly because Phantom is Solana’s marquee wallet and far ahead of competing wallets like Solflare or Backpack, with 15 million monthly active users (MAUs).



If Phantom wanted a cut of the perps market, I suppose one would’ve naively expected it to partner up first with a native Solana perps DEX like Drift or <a href="https://x.com/DefiSolar/status/1942657673994068081">Jupiter</a>.



But though Drift or Jupiter might be hometown favorites, Hyperliquid is where the money already is.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXcFE4l4Km4H4mpQpTG8JLhnqumZMyAFqEgNLpMaiAKAF0towGfMZANz_aUCNsS6FI74YF77MmZLj-O3C7wY6vq8uxf-plujUo1HLgHr7uG85vviI-iyDQgiyYoxiFVFNDBrA03dvg?key=D8S8VRimuiNq_D7bNzCT1w" alt=""/></figure>



Source: <a href="https://dune.com/uwusanauwu/perps">Dune</a>



So the wallet that onboarded millions to Solana is now shepherding flow to a rival venue, which doesn’t boost Solana fees or TVL at all.



Just this morning, Kraken and Backed announced that xStocks would also be launching on BNB Chain.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Welcome Kraken, Backed and xStocks to the <a href="https://twitter.com/BNBCHAIN?ref_src=twsrc%5Etfw">@BNBChain</a> ecosystem. 🤝<a href="https://t.co/gg2k8SEsgE">https://t.co/gg2k8SEsgE</a>&mdash; CZ 🔶 BNB (@cz_binance) <a href="https://twitter.com/cz_binance/status/1942933592541110398?ref_src=twsrc%5Etfw">July 9, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Soon, eligible Kraken customers will be able to deposit and withdraw those BEP-20 stock tokens straight from the exchange.



xStocks is Kraken and Backed’s tokenized stock product that debuted on Solana less than two weeks ago (I wrote about it <a href="https://blockworks.co/news/tokenized-stocks-good-bad">last week</a>).



Tokenized stocks may have been Solana-first, but they will be fiercely multichain. <a href="https://x.com/Bybit_Official/status/1939626244728840498">Bybit</a> is also integrating xStocks.



xStocks’ move to BNB Chain is no surprise, given Backed co-founder Adam Levi’s <a href="https://www.businesswire.com/news/home/20250522493630/en/Kraken-Partners-with-Backed-to-Launch-xStocks-on-Solana-Bringing-Tokenized-Equities-to-the-Masses">stated goal</a> for the product to “be a neutral, public good asset class” and eventually “expanding xStocks to other exchanges and chains.”



What investor mental model do these pieces of news affirm?



The Phantom x Hyperliquid news seems to simultaneously affirm both the <a href="https://blockworks.co/news/battle-for-wallet-supremacy">Fat Wallet</a> thesis and <a href="https://blockworks.co/news/crypto-infrastructure-bloat">Fat App</a> thesis.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">This Phantom x Hyperliquid integration is: • Bullish for Phantom (validation of fat wallet/super app thesis) • Bullish for Hyperliquid (validation of fat protocol thesis) • Bearish for Solana (they have no good perp dex, distribution moat is much smaller than perceived)&mdash; Uma Roy (@pumatheuma) <a href="https://twitter.com/pumatheuma/status/1942669033771536640?ref_src=twsrc%5Etfw">July 8, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Build a great wallet like Phantom, because wallets, not apps, own the users.



Or build a great app like Hyperliquid, because users follow the app, not the underlying chain.



But if you can, you should most definitely build a Fat Exchange like Robinhood or Kraken, because then you can take your users to whichever chain you want.



Kraken is a Fat Exchange, but it’s not quite as Fat as Robinhood’s 14 million MAUs.&nbsp;



That may explain Kraken’s decision to go multichain fast and cement its position on each respective blockchain.



There was never really a reason to believe that wallets, apps or CEXs would be loyal to any particular chain to begin with.



Time to totally disabuse that notion.



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The winners and losers of Phantom’s Hyperliquid integration

Macauley Peterson

This is a segment from the 0xResearch newsletter. To read full editions, <a href="https://blockworks.co/newsletter/0xresearch" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Hyperliquid has become the dominant venue for onchain perpetuals, leapfrogging <a href="https://blockworks.co/tag/dydx">dYdX</a> by embracing a radical idea: full transparency. Every resting order is hash-linked to a wallet, whose P&amp;L and liquidation level are visible to the network. This “L4” order book is more granular than TradFi’s L3 venues, which conceal trader identity, positions or leverage levels.



Hyperliquid’s radically transparent market structure has no informational asymmetry between participants — and given its stellar growth, it’s working. But is it optimal?



Jeff Yan, the founder of Hyperliquid Labs, argues yes. In a recent <a href="https://x.com/chameleon_jeff/status/1929753039969440212">X thread</a>, he likened the design to ETF rebalances and electronic lit markets in equities. His thesis: Transparency lets market makers identify non-toxic flow, tighten spreads and scale liquidity, even for billion-dollar whales.



Yet, Variational, the team behind a new derivatives protocol on <a href="https://blockworks.co/tag/arbitrum">Arbitrum</a> called Omni, is betting on the opposite design choice: total privacy.



Critics like <a href="https://x.com/ThomasUhm/status/1929170772095815702">Thomas Uhm</a> and Edward Yu (Variational’s co-founder) <a href="https://x.com/mr_plumpkin/status/1929059419326918822?s=46">pointed out</a> a potential flaw: Transparency benefits uninformed flow — not alpha traders. “If you’re a profitable trader with edge, you want to move in stealth,” Yu told Blockworks. “Otherwise, the market will price in your impact the moment your intent becomes visible.” For example, “if someone can see your flow ahead of time through L4 data, they can frontrun, fade or cancel. Your alpha disappears.”



Omni, which announced today that it has raised $1.5 million in strategic funding from Mirana Ventures, Caladan, Zoku Ventures among others, is a peer-to-protocol trading venue, CEO Lucas Schuermann explained to Blockworks.



Users RFQ directly against an integrated market maker — the Omni Liquidity Provider (OLP). There’s no public book. No shared intent. Every fill is private.



When a trader joins Omni, they receive a segregated individual smart contract to hold all their funds. “We call it a settlement pool — essentially an escrow account for the margin that sits between the user and OLP,” Scheurmann said.



Omni is explicitly designed to shield traders. It’s a philosophical fork from the Hyperliquid hypothesis. Schuermann explained that the architecture evolved from institutional RFQ rails: “We essentially took all of our experience and infrastructure and market making liquid products…and we put that knowledge into OLP,” Schuermann said. “But after building all this infrastructure, we realized it could solve problems for retail.”



This private structure enables more than just discretion — it also redistributes protocol revenue. OLP vault depositors <a href="https://docs.variational.io/variational-omni/about-omni/the-omni-liquidity-provider-olp#how-olp-is-funded">will eventually</a> earn market-making profits, while traders receive partial refunds on losing trades. “We don&#8217;t want to sell the order flow to a third party who&#8217;s going to extract value. We want to give it back to users.”



This may sound similar to Hyperliquid’s HLP model, but the design philosophies differ sharply. Hyperliquid’s HLP vault allocates capital to in-protocol market makers who compete to quote tight spreads on the order book, with profits or losses passed back to HLP depositors. By contrast, the OLP vault routes liquidity to external venues — including Binance, Bybit and even Hyperliquid itself — where it acts as a taker, not a maker. This lets OLP sidestep the toxic flow and predatory dynamics that can come with posting passive quotes, especially on transparent books.



It does introduce custodial risk for liquidity providers, comparable to holders of Ethena’s synthetic dollar product: Funds leave the Omni protocol and rely on third-party exchange APIs and account controls.



Variational mitigates this risk by maintaining control over those deployments and publicly tracking all balances and trades for the OLP strategy. The added operational risk is compensated by what the team believes is materially better execution.



Omni is part of a broader movement: user-owned infrastructure. And Schuermann believes this model can scale liquidity — even for the long tail of assets, which are usually related to AMM pools like Uniswap or Radium.



Omni routes trades through a competitive, gasless RFQ pipeline where OLP quotes all pairs.&nbsp;



“We pick these up automatically amongst many others, and list them along with hundreds on our platform, but the key thing is OLP market makes them from day one,” he said, noting that making illiquid products liquid is part of the Variational team’s core expertise.



So while it’s hard to see anyone dethroning Hyperliquid right now, Omni may hope to carve out a new lane, one built for retail flow with edge, where alpha is protected and profits flow back to users.



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To take on Hyperliquid, Omni bets on privacy

Jack Kubinec

This is a segment from the Lightspeed newsletter. To read full editions, <a href="https://blockworks.co/newsletter/lightspeed" target="_blank" rel="noreferrer noopener">subscribe</a>.



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Not many of crypto’s top 15 tokens by market capitalization were first issued after FTX’s collapse. Two exceptions are SUI, which began trading in mid-2023, and HYPE — which has risen to over $11 billion in market capitalization since being airdropped in November 2024.&nbsp;



HYPE, which is the native token of the Hyperliquid layer-1, has more than tripled in price since a local bottom on April 6, outpacing SOL’s roughly 70% gain over that time span. For crypto investors seeking the next layer-1 token that could capture Solana-like returns, HYPE is generating a lot of hype. Even Galaxy’s Mike Novogratz is <a href="https://x.com/stevenyuntcap/status/1923368561671606595">on board</a>.



Hyperliquid’s core layer-1 appchain, called HyperCore, is purpose-built for Hyperliquid’s order book exchange, which generates fees and leads to token buybacks. This product is very popular: Hyperliquid accounted for 77% of onchain perpetuals trading volume in April, <a href="https://app.artemisanalytics.com/sectors">according</a> to data from Artemis. Hyperliquid also has an Ethereum Virtual Machine network called the HyperEVM, but its adoption is so far more <a href="https://app.blockworksresearch.com/research/hyperliquid-not-done#valuation">muted</a> than HyperCore.



So, there is some confusion on HYPE: Should it be valued like a perps DEX that is maxing out demand in the perps DEX market, or like a layer-1 that could compete with the likes of Ethereum and Solana?



HYPE is priced somewhere in the middle. Ryan Watkins of Syncracy Capital — which has positions in both HYPE and SOL — posted a chart showing in early March how Hyperliquid was trading at a lower fee multiple than other L1s, including Solana.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXftPe5-9rbUN50TMy8G-KUgjTgJB6AKVge5iklezPSJoAXt8p9d5RyxtESy329JFuPrjQE45aE_mJN3AfUfWIOX4qrVpGtOadRoApRcQ3cO3djv1bhWxRjHtpnuk-T5RsDVlbk_?key=ec3LIWV_Fs75WjSNR7Pdyw" alt=""/><figcaption class="wp-element-caption">Source: <a href="https://x.com/RyanWatkins_/status/1897302205327401167">Ryan Watkins on X</a>.</figcaption></figure>



But as Blockworks Research analyst Boccaccio <a href="https://app.blockworksresearch.com/research/hyperliquid-not-done#valuation">has pointed out</a>, Hyperliquid trades at a higher fully diluted valuation (FDV) to fees ratio relative to competitor perps DEXs in Drift and dYdX, indicating it is more valuable to investors compared to simple perps DEXs.&nbsp;



Bitwise Research analyst Danny Nelson said Hyperliquid aims to create a vibrant blockchain economy like Solana’s, but it’s “not quite there yet.”



“That said, the ecosystem’s flagship perpetual contracts exchange has become an industry juggernaut. The market is pricing HYPE accordingly, and, I would argue, attempting to account for a future where Hyperliquid hosts yet more winners,” Nelson added.



There are other idiosyncratic factors at play as well. Hyperliquid’s validator set is <a href="https://blockworks.co/news/hyperliquid-decentralization-validator-put">not as decentralized</a> as some other L1s. Hyperliquid does not require know-your-customer (KYC) checks, and most centralized exchanges such as Binance do, and maybe that’s a valuable feature to some traders that is being priced in as well.



For dopamine-deprived token investors, HYPE may look like the kind of opportunity that has been fewer and further between in recent years, but it’s likely too soon to call it the next SOL.



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Hyperliquid valued between layer-1 and perps DEX

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Throughout much of the memecoin-fueled boom in Solana application revenue, the leaderboard has looked like this: pump.fun, Phantom, and an established group of so-called trading bots.&nbsp;



That stasis broke in recent weeks as a new competitor quietly climbed the ranks. Axiom, an online trading platform combining trading bot capabilities with Hyperliquid’s perpetual futures product, is now solidly in second place behind pump.fun in terms of Solana app revenue.



Last week, pump.fun saw $12.2 million in revenue, while Axiom was close behind with around $10.5 million, according to Blockworks Research. Phantom, with around $4.3 million, was a semi-distant third.&nbsp;



Axiom was co-founded by a pair of 22-year-old UC San Diego graduates, Henry Zhang and Preston Ellis. The computer science majors “had nothing really to do” in college, but they were both into crypto trading, so they built a couple of projects in their free time, Zhang told me.&nbsp;



Ellis was finishing up college, and Zhang was just starting as a software engineer at TikTok when the <a href="https://blockworks.co/news/solana-memecoins-all-time-high">Solana memecoin craze</a> began taking off. The pair decided to try building a platform that could rival the trading bot of choice, Photon. They built an initial product in mid-2024 and were selected into the winter batch for Y Combinator, the prestigious startup accelerator that counts Airbnb, Coinbase and Reddit as alumni. Zhang and Ellis said Y Combinator connected them with Jordan Fish, the crypto entrepreneur and online personality known as Cobie on X, who offered them advice — including that they should avoid opening up the checkbook for key opinion leaders (KOLs).



Trading bots are kind of like souped-up DEX aggregators that specialize in quickly and successfully landing crypto transactions. They’re popular among users for things like sniping — a term for buying up memecoins right after they are created — and tracking new token launches. Many are built on Telegram, although Axiom is only a web app.



It’s a crowded field, but Axiom has separated itself from the pack in recent weeks. In late February, the trading bots Photon, BullX, and Trojan combined for around 75% of Solana trading bot volume, according to a Dune <a href="https://dune.com/adam_tehc/trading-bots-on-solana">dashboard</a>. Today, Axiom has more than 50% of market share by itself.



Why does Axiom command so much revenue? Blockworks Research analyst Danny Knettel <a href="https://blockworks-research.beehiiv.com/p/bitcoin-yield-reimagined">told Donovan Choy</a> of the 0xResearch newsletter that Axiom’s secret sauce was combining the two most popular trading products of the moment — Solana memecoins and Hyperliquid perpetual futures. Knettel told me he’s heard rumors that other crypto teams are considering merging these two product offerings as well.



Zhang said Axiom’s rakeback program, where power users are given claimable fee rebates as opposed to the tier-based fee system on venues like Binance, is popular among users as well.



Then, of course, Axiom is running a points program, which tends to spur a short-term increase in usage. For what it’s worth, Zhang and Ellis told me they have no plans of launching a token — which tends to be the key ingredient in airdrop farming.&nbsp;



The pair also said they won’t be raising additional venture funding following Y Combinator’s seed check, as the business is already quite profitable.



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Meet Y Combinator’s memecoin bet that made $10M last week

Katherine Ross

This is a segment from the Empire newsletter. To read full editions, <a href="https://blockworks.co/newsletter/empire" target="_blank" rel="noreferrer noopener">subscribe</a>.



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When I talk to folks about success stories in crypto, Hyperliquid is often the common answer.&nbsp;



“Over the past three months, the platform has averaged $6.4 billion in daily trading volume, which sits just above 50% of the daily trading volumes of Bybit and OKX,” Blockworks Research’s Boccaccio wrote in a <a href="https://app.blockworksresearch.com/research/hyperliquid-not-done">recent report. </a>



“As of today, the BTC OI [open interest] on Hyperliquid sits at $1.4B, which is 15% of Binance ($9.2B), 46% of OKX ($3B) and 25% of Bybit ($5.6B),” Boccaccio wrote. 



To put that into perspective, Jupiter Perps — the closest competitor to Hyperliquid — averages $704 million in daily trading volume, 88% lower than Hyperliquid.



<figure class="wp-block-image"><img decoding="async" src="https://lh7-rt.googleusercontent.com/docsz/AD_4nXdE6OC7whWrP2myWF7sf2xnah1DuCFnVwBWa4y3Sg6HJz2HTu3V4vPF13ASYLqhXAh5bI4dZkFXd1hALE-2S9DH68mGtFF4yGjnMCwOsaWvRcvPNmjvxGuL7acsTFb9WyA4OPhNbg?key=Ciq3U7CPgJ9LFPr2ZJgHd83d" alt=""/><figcaption class="wp-element-caption">A look at perps DEX volumes across the board. </figcaption></figure>



Boccaccio also noted that Hyperliquid’s UX and ability to list popular tokens quickly have helped boost its popularity.&nbsp;



Hyperliquid’s core businesses are HyperCore (the order book exchange) and HyperEVM (the EVM network). Right now, HyperCore is the dominant business, with a valuation of $11.2 billion to HyperEVM’s $61 million.&nbsp;



But that “discrepancy” is warranted, Boccaccio wrote, “given that the core product is, and should be, the HyperCore, while the HyperEVM initially will likely act as a supporting chain.”



The report notes that HyperEVM could be a more profitable product later on, especially if it integrates token launchpads, SocialFI, NFT marketplaces on the chain.



Guess there’s a reason for all that HYPE.



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<li><a href="https://blockworks.co/newsletter/the-breakdown">The Breakdown</a>: Decoding crypto and the markets. Daily.</li>



<li><a href="https://blockworks.co/newsletter/0xresearch">0xResearch</a>: Alpha in your inbox. Think like an analyst. </li>



<li><a href="https://blockworks.co/newsletter/empire">Empire</a>: Crypto news and analysis to start your day.</li>



<li><a href="https://blockworks.co/newsletter/forward-guidance">Forward Guidance</a>: The intersection of crypto, macro and policy.</li>



<li><a href="https://blockworks.co/newsletter/thedrop">The Drop</a>: Apps, games, memes and more.</li>



<li><a href="https://blockworks.co/newsletter/lightspeed">Lightspeed</a>: All things Solana.</li>



<li><a href="https://blockworks.co/newsletter/supply-shock">Supply Shock</a>: Bitcoin, bitcoin, bitcoin.</li>
</ul>