HIP-3 SILVER: HYPERLIQUID VS. CME – A TEST IN HIGH VOLTAGE ⚔️ HIP-3 is expanding Hyperliquid beyond the realm of pure cryptocurrency. Products pegged to traditional assets now account for approximately 31% of total volume, with daily notional value exceeding $5 billion. In this context, the silver perpetual contract is the focal point. The recent sharp price drop has become a crucial test of the platform's market quality. 👍 The period before the crash Under normal trading conditions, @HyperliquidX demonstrates remarkable competitiveness in the small order size segment – ​​a dominant Capital of perpetual contract trading. The median bid-ask spread is approximately 2.4 basis points, lower than the 3 basis points on COMEX. The median slippage fluctuates around 1–2 basis points, relatively close to CME standards. However, Order Book depth remains limited. Within a range of ±5 basis points, Hyperliquid has approximately $230,000 in two-way liquidation , while COMEX has around $13 million. This means that for small orders of a few thousand USD, transaction costs on Hyperliquid are quite competitive; but for orders over $50,000, CME's liquidation advantage becomes apparent. ⚠️ During the sell-off phase When unexpected political news emerged, silver prices experienced their sharpest decline in decades. Both markets were under pressure, but Hyperliquid saw a more pronounced decline in order matching quality at the distribution end. The median spread on Hyperliquid increased 2.1 times, while on COMEX it increased 1.6 times. At one point, the price difference between Hyperliquid and the benchmark market exceeded 400 basis points, although this lasted for less than two minutes before narrowing again. Approximately 1% of trades on Hyperliquid deviate by more than 50 basis points from the mid-price, while similar cases are virtually nonexistent on COMEX. Nevertheless, the market maintained continuous trading without interruption. Price discrepancies were quickly corrected through funding mechanisms and the recovery of liquidation. 🔄 Weekend period – advantage for continuous trading When COMEX closed for the weekend, Hyperliquid continued trading for 49 hours, processing over 175,000 transactions with a total value of approximately $257 million. The median spread even narrowed to 0.93 basis points. Although total volume decreased by about 31% compared to a normal day, transaction costs for smaller orders were lower. Notably, the internal price before COMEX reopened was quite close to the actual opening price. The initial gap narrowed rapidly within seconds. This suggests that Hyperliquid's 24/7 market can form a useful reference price when traditional markets are temporarily closed. 🚀 Conclusion Hyperliquid cannot yet compete with CME in terms of liquidation depth and the ability to handle large orders. However, with small and Medium order volumes, the market quality has reached a noteworthy level. The key strategic value lies in the ability to trade continuously 24/7, allowing investors to position and transfer risk outside of traditional hours. In an increasingly globalized and continuously operating market, this could be a significant structural advantage in the future. ⚠️ This is not investment advice. (As Chia by @shaundaevens - analyst at Blockworks Research)