Original author: David, TechFlow
There aren't many noteworthy projects during this downturn, but Hyperliquid is one of them.
$HYPE has nearly doubled from its January lows. Regardless of your opinion of the project, the market is voting. But Kyle Samani, the former co-founder of Multicoin, voted against it.
On February 8th, Blockworks Research released a research report stating that Hyperliquid's silver contracts have begun to compete head-on with traditional futures exchanges like the CME in terms of spreads and execution.
Many people in the industry forwarded this message, believing it to be a signal that blockchain finance is truly starting to encroach on the territory of traditional finance.
But Kyle poured cold water on the idea.
He believes that Hyperliquid represents almost every classic problem in the crypto industry:
- The founder fled his homeland to build this project.
- The platform openly facilitates crime and terrorist activities.
- Closed source code
- The product is running with authorized permissions, but is not fully open.
This statement, if placed before, would actually be a very common example of mutual criticism between projects on encrypted CT.
But let's not forget that just four days ago, Kyle announced his departure from Multicoin Capital, and before the announcement, he posted a tweet that he later deleted:
"Cryptocurrency is not as interesting as many people (including myself) once imagined."
However, Arthur Hayes, an old acquaintance, clearly disagreed with this assessment, and directly expressed his confidence in HYPE after Kyle finished speaking:
"Since you think HYPE is so bad, let's make a bet. From February 10th to July 31st, if HYPE outperforms any coin you choose with a market capitalization of over 1 billion, the loser will donate $100,000 to the charity chosen by the loser. You choose the coin, I'm only betting on HYPE to win."
Criticism, leave the card table
However, as of press time, Kyle has not accepted Arthur's bet, and it is highly unlikely that he will.
Someone who just said "crypto isn't that fun anymore" is unlikely to sit back at the poker table and compete to see whose coin has appreciated the most.
But Kyle's accusations against Hyperliquid are worth discussing.
For example, "the founder fled his home country." Hyperliquid founder Jeff Yan grew up in Palo Alto, California, graduated from Harvard, and previously worked in quantitative trading at the high-frequency trading firm Hudson River Trading.
The team is based in Singapore, the company is registered in the Cayman Islands, and the platform blocks US users.
This architecture is used by everyone from Binance to dYdX. Kyle has been in this industry for almost ten years, so it's impossible that he doesn't know that this is standard practice for offshore compliance.
Calling it "escaping the homeland" sounds a bit contrived for an American who grew up in Palo Alto.
The points about closed-source software, access control, and facilitating crime are not without merit, but Kyle might not have publicly expressed these criticisms in the past. When he was at Multicoin, his job involved finding, investing in, and promoting projects; these gray areas were unspoken costs within the industry.
The change is that Kyle is no longer in that position.
What a person sees after leaving the card table is different from what they saw while sitting at the table.
The pump and dump, need I say more?
On the other hand, you see that Arthur Hayes did not refute any of Kyle's accusations, did not defend Hyperliquid's closed-source nature, and did not explain why Jeff Yan moved to Singapore.
His response was a price bet.
This is a familiar logic in the crypto: pump and dump mean a good product. The reason for responding with price is that, for those still working full-time in this industry, price is the only meaningful language.
You say Hyperliquid has ethical flaws, but he says HYPE will outperform any large-cap Altcoin in five months.
These two sentences seem to be talking about the same thing, but they are actually on completely different levels.
Kyle was asking "should it be?", while Hayes was asking "whether it will rise or not?"
This kind of misunderstanding plays out in every cycle of the crypto world. In the mid-to-late stages of each bull market or during a bear market, a group of people always start saying there's something wrong with the industry, while those who remain always respond with the same phrase:
Then take a look at the price.
The price of the coin is the most convenient weapon for players still in the market, because as long as it keeps rising, all criticisms can be temporarily set aside.
The problem is that Kyle may no longer be entirely an insider. It's inappropriate in any industry for a fund's co-founder to publicly express disillusionment with the entire sector before officially leaving.
The post may be deleted, but the thoughts remain.
His current scathing attack on Hyperliquid, delivered with such uncompromising force, doesn't feel like criticism of a project; it's more like a severing of ties with something from his past eight years.
However, while individuals can separate themselves from the project, Multicoin itself remains caught in the middle.
Starting January 22nd of this year, on-chain analysts discovered that a wallet suspected to be associated with Multicoin deposited approximately 87,000 ETH into Galaxy Digital, and the following day began purchasing HYPE in 17 separate transactions, totaling approximately $46 million.
In other words, right before and after Kyle left Multicoin, his former fund was making large investments in the project he had just vehemently criticized.
The 17 separate purchases likely indicate that someone within Multicoin made the judgment and the decision.
Kyle believes Hyperliquid represents all the problems in the crypto industry, but at least some people in Multicoin think it's worth voting with real money; holding it is an attitude in itself.
Kyle is gone, but his former employer's money may have settled in. And it's settled in the very table Kyle disliked the most.
Aside from the online battle between Arthur and Kyle, the reactions in the comments section were also quite interesting.
A user named Max in the Hyperliquid community unearthed an old post he made in September 2024. The post was made in response to questions about Multicoin's practices within the industry at the time, and Max criticized Multicoin, essentially saying:
"You're always trying to use LPs' money to chase the beta returns of your heavily invested assets, and incidentally boosting your portfolio."
A year and a half later, Kyle is now criticizing Hyperliquid, and Max believes that the formula hasn't actually changed:
Kyle is still the same Kyle, always criticizing others through the lens of his own portfolio. His past defense of Solana and present criticism of Hyperliquid stem from his anxieties about the ecosystem interests and competition within Multicoin.
Kyle couldn't resist replying with a classic crypto comment: "The money I've invested in crypto is at least 10 times what you'll earn in your lifetime. "
Max's follow-up comment hit the nail on the head: " Last September, your assets were probably 30 times mine..."
From September 2025 to February 2026, the market experienced several ups and downs. Multicoin, which Kyle previously represented, saw its crypto assets shrink significantly, while Hyperliquid remained relatively stable.
One's stance is always inseparable from their position.
When a project begins to threaten the traffic and valuation of an existing ecosystem, criticism is often quickly labeled as "stakeholder"; conversely, defenders will retaliate by saying "you're just jealous".
In this attack, Kyle attempted to criticize Hyperliquid from the perspectives of morality and the purity of decentralization, but his opponent easily steered the attack back to the law of the jungle: "whoever makes money is right."
Ultimately, rational discussion was drowned out by the tribal frenzy, leaving only screenshots and jokes.
This is how it goes in every cycle. Some people sit down, some people stand up. Those who sit down talk about prices, those who stand up talk about ethics.
But whether one becomes disillusioned with the industry first and then sees the problems, or sees the problems first and then becomes disillusioned with the industry, is actually hard to say.
Whether HYPE goes up or down in five months, Kyle probably won't care. He's already looking at other things.
