Author: Ray's New World
The recently disclosed listing mechanism of Hyperliquid has sparked heated discussions. However, the reason why this incident has attracted market attention is inseparable from a tweet posted by Simon, the CEO of Moonrock Capital, on November 1 this year. He claimed that "Binance requires a potential project to provide 15% of its total token supply to ensure its listing on the CEX, which accounts for 15% of the total token supply, worth about $50 million to $100 million."
Meanwhile, Andre Cronje, the co-founder of Sonic Labs, also wrote that "Binance does not charge a listing fee, but Coinbase has repeatedly demanded fees, quoting $30 million, $50 million, and $60 million."
Why is there always a dispute over listing fees?
In the Crypto world, which is primarily based on the spirit of decentralization, centralized CEXs have become the main participants. However, the black-box operations of CEX listings are difficult for the market to accept, and "rumors" about CEX listings circulate from time to time. Binance founder He Yi once stated "no listing fees were charged" after listing PNUT and ACT, and even Binance needs to get out of the "listing fee" controversy through the listing itself.
He Yi's response to the controversy over listing fees
Nevertheless, it is still difficult for the market to be fully convinced by the CEX's claim of no listing fees. Even if there is no "open and aboveboard" charging, rumors about hidden token fees continue to emerge. Although some leading CEXs have clearly listed no listing fees in their announcements, the project parties still need to pay corresponding deposits to ensure the stability of the token price after listing, and the CEX's investment share and activity expenses need to be agreed upon at the time of listing. These inexplicable hidden listing fees have also become the reason for the market to determine the "black box" operation of CEX listings.
On the one hand, this cumbersome and opaque listing mechanism is an additional burden for the project parties. The project parties need to spend extra costs to deal with the CEX's listing affairs, which will lead to the problem of adverse selection. The project parties are not focused on long-term development, but instead have the expectation of "successful listing", which ultimately leads to most of the listed projects cashing out and running away.
On the other hand, the unfair listing of CEXs has even evolved into a niche track. Studying listings has become a legitimate "business", and listing knowledge has become a must-take course for many investors and KOLs. For example, the recent news about the Formula News made a profit of $3 million by trading on the news of ACT's listing.
Formula News made a pre-trade on the listing announcement
It can be said that the crypto industry has long been plagued by centralization, and the wealth effect of each listing is almost taken away by CEXs (listing fees) and scientists (pre-trading after listing), while the project parties have to bear a considerable listing fee, which will sacrifice the quality of the project, and ultimately it is the retail investors who pay the bill. The listing event and the current logic of retail investors embracing memecoins and rejecting VC coins are of the same nature, the core of which is still inseparable from fairness.
HYPE hits new highs, what is the market optimistic about?
However, the emergence of Hyperliquid has broken the deadlock of "black box listing".
The rise of HYPE started from its "listing victory". HYPE has entered the top 50 market cap in just two weeks after its TGE, surpassing projects like Fantom, Bittensor, and even Arbitrum itself. Although the narrative of Perp DEX is no longer new, Hyperliquid has successfully refocused the market's attention on DEXs.
The indispensable listing mechanism
Today, HYPE has broken through $20, setting a new historical high. Behind the new high, on the one hand, it is inseparable from Hyperliquid's accurate "market aesthetics", which has keenly captured the market pulse of this cycle's "VC to meme" transition. As a project that looks like a "VC-backed" one, Hyperliquid did not take the old path of VC financing first, then volume-boosting and listing for cash-out. Its founder Jeff has also publicly expressed his dissatisfaction with this form and market logic.
On the other hand, Hyperliquid's team operations and project development are also top-notch. Hyperliquid's ambition is not limited to PerpDEX, but is also actively building a "trading" public chain with low latency, high throughput, high-frequency trading, and order book as its characteristics. When the underlying logic shifts from PerpDEX to public chain, it also opens up its valuation ceiling.
In addition to the above reasons, Hyperliquid's open and transparent listing mechanism is also an indispensable factor for its success. So how does Hyperliquid specifically list?
Dutch Auction
Hyperliquid uses a Dutch auction to auction the token's ticker, and its listing process is also relatively open and transparent, with detailed introductions in the official documentation.
First, if a project wants to list on the spot market, it needs to apply for the deployment permission of the HIP-1 native token (HIP-1 is the token standard formulated by Hyperliquid), and then the final token ticker will be determined through a Dutch auction mechanism. Dutch auction, also known as a descending price auction, starts with a price higher than the market expectation, and then the price is continuously lowered until the first person accepts the price. From the perspective of game theory, the Dutch auction reflects the true psychological expectation of the bidders, and can realize the auction at a fair price.
Hyperliquid spot deployment process
When a project deploys tokens on Hyperliquid, it needs to pay a gas fee, but this gas auction fee will be refunded to the HLP Vault in the future.
At the same time, Hyperliquid's auctions are usually held every 31 hours, with a maximum of 282 spot listings per year. This "passive limit" approach also indirectly improves the quality of the listed projects.
In summary, compared to the opaque black-box operations that confuse the public in CEXs, Hyperliquid's listing mechanism achieves public transparency, and the collected gas auction price will be returned to the community in the form of staking, forming a virtuous cycle.
Derivative gameplay of the auction mechanism
With this open auction mechanism, more interesting paths will emerge in the future. For example, this auction mechanism will also lead to "ticker" disputes. At the beginning of this year, when zkSync was listed on various major exchanges, Polyhedra Network, which initially used the ZK token ticker, gave the premium ZK ticker to zkSync, and then Polyhedra's token was changed to ZKJ.
It can be foreseen that in the future, more projects will appear with similar "fighting" behaviors after listing on Hyperliquid. Project parties will fight hard to strive for token tickers that are more suitable for their own, and stories similar to "Sina spent 8 million dollars to buy weibo.com" and "Finance was auctioned off by Moniker for $3.6 million in 2007" in Web2 will also be staged on Hyperlqiuid in the near future.
The "big loser" who spent $180,000
After Hyperliquid's TGE and the completion of the "epic" airdrop, the auction price has been constantly breaking new highs. As early as around June this year, its auction ceiling was hovering around $35,000 and was unable to break through the previous $35,000 hard ceiling. However, after the TGE, Hyperliquid has received unprecedented market attention, and this time it directly "pushed" to $128,000, breaking through the previous shackles. On December 11, it reached a new high of $180,000 in the FARM auction.
Here is the English translation of the text, with the specified terms translated as instructed:The previous record-breaking $128,000 ticker bidding war originated from "SOLV", and it was noticed that the Solv Protocol will have a TGE in the near future, so it is highly likely that this ticker was won by the Solv Protocol. The token tickers auctioned by Hyperliquid previously were usually meme-based, such as PIP and CATBALL.
After this airdrop, the heat of Hyperlqiuid also began to soar. The record-breaking SOLV auction was a turning point for Hyperliquid to transition from the meme paradise to the mainstream onboard. Solv Protocol will also be the first top-tier project to go live on Hyperlqiuid.
Meanwhile, Solv's login has brought a significant "catfish effect" to Hyperlqiud, not only setting an example for the subsequent ticker auctions on Hyperliquid, but also pushing the trading structure to a more positive direction.
Hyperliquid Auction History
On the one hand, after the price ceiling was broken by the SOLV auction, the tokens auctioned by Hyperliquid afterwards also "got better". The market took the SOLV auction as a reference for post-TGE pricing, and tickers like BUZZ and SHEEP reached over $100,000 in bids, with the lowest HYFI also transacting at $90,000. Subsequently, the FARM ticker on December 11th even refreshed the historical record at $180,000.
The FARM token ticker was ultimately owned by @thefarmdotfun, who is building the world's first GenAI-powered pet agent game, where users can generate different types of pet AI agents through the GenAI model. When these AI pets are minted or traded, FARM tokens will be used for charging. With a fixed total supply, 50% of the FARM used as fees will be burned. The $180,000 for FARM was not in vain, as it reached a market cap of over $30 million within a few hours of opening, approaching $50 million. This has also reopened the imagination of the Hyperliquid ecosystem.
FARM reached a market cap of nearly $50 million on December 13th
On the other hand, according to AXSN's data, the daily trading volume of the HYPE token has already monopolized the trading on Hyperliquid, reaching $360 million, far ahead of tokens like PURR, PIP, and JEFF. With the login of Solv Protocol, the trading structure of Hyperliquid will be further optimized. With the market attention and discussion brought by the Solv Protocol, more projects will choose to debut on Hyperliquid, and the trading volume will be more dispersed in the future.
Hyperliquid Trading Structure Distribution
What has Hyperliquid changed?
As Hyperlqiuid founder Jeff said, "ownership goes to the believers and doers, not rent-seeking insiders". The development of Hyperliquid also conforms to this.
Mutual Pursuit with Project Teams
For VC coins, listing on Hyperlqiuid is also a mutually beneficial and symbiotic market behavior. The auction itself is also a form of advertising. Without paying additional advertising fees, Solv became the traffic center of market discussion by winning the Hyperliquid auction ticker.
For many shitcoin projects, even if they have been listed on major exchanges, it is still difficult to maintain a good "K-line" if they cannot be listed on top-tier CEXes during the bull market. Without liquidity, there is no traffic, and no subsequent stories, and most obscure tokens listed on exchanges become "high heels" or "Christmas trees".
Many tokens are difficult to stabilize even after being listed on major exchanges
Hyperliquid provides a more economical solution, which can temporarily meet the demand of those who cannot debut on major exchanges, and can also "grab a seat" by listing on a good trading platform at low cost. After the subsequent integration of HyperEVM, the tokens purchased on Hyperliquid can be used in other EVMs, further highlighting its relative advantages in terms of cost-effectiveness. Although currently Hyperliquid does not have the same strong listing effect as CEXes, the widespread market attention on the SOLV auction event has further highlighted its status in the eyes of the crypto community.
Hyperliquid's epic airdrop is more like a thunderous market education, allowing more people to recognize Perp DEX, understand, contact and use it; the transparent listing plan is the first shot fired against the black box operation, resistance, struggle and victory.
From the industry's perspective, the emergence of Hyperliquid is both a historical process and a choice of the times. Under the clamor of the masses, the market has voted with its feet again and again, choosing fairness. Hyperliquid's open listing mechanism is a revolution against the black box operation of the existing CEXes, forcing the entire industry to become more open and transparent.
What kind of entrepreneurial spirit does Crypto need?
Often, the founder of a company determines the spiritual core of that company. This statement is vividly illustrated in Hyperliquid.
Founder Jeff no longer trusts CEXes after the FTX collapse and does not accept any VC investment. In Jeff's eyes, most projects will first obtain the endorsement of top-tier institutions, then dress up the data through various so-called point systems, and finally complete the exit through listing on major trading platforms. This industry model seems to have become the ultimate template for most projects to achieve success: write stories, raise investments, and list on major exchanges. Ultimately, the retail investors bear all the consequences, leading to a mess, and this kind of short-sighted industry chaos is ultimately unsustainable.
Ultimately, Hyperliquid witnessed the victory of Jeff's decentralized spirit, and the transparent and open mechanism and the strong cohesive force of the community have pushed PerpDEX to the climax of 2.0. Jeff can proudly say: We have not distributed tokens to any private investors, centralized exchanges, or market makers. The bullets fired years ago have now hit the bull's-eye.
The history of Crypto's development has also been a history of the struggle for decentralization, from the birth of Bitcoin to the uppercase and lowercase disputes of Neiro. No matter how Crypto evolves, victory and justice will always be on the side of the masses, on the side of fairness, and on the side of decentralization.
