Author: Nancy, PANews
The cost of listing on exchanges has always been a focus of market controversy, with exorbitant listing fees often seen as an important factor hindering market innovation. Therefore, more and more emerging projects choose to use DEX (decentralized exchanges) as their initial launch platform, but at the same time, the risk of Rug also increases significantly.
Recently, the derivatives DEX Hyperliquid not only performed well in multiple data metrics after a successful textbook-style airdrop, but its spot listing auction price also hit a new high, further enhancing the platform's market advantage. Under the strong data, PANews has learned that many projects have already set their sights on listing on Hyperliquid.
Listing auction price increased significantly after the airdrop, and spot trading liquidity is concentrated in HYPE
On December 6th, a Token ticket named "SOLV" refreshed Hyperliquid's new auction record at around $128,000, attracting the attention of many investors, which is suspected to be related to the upcoming TGE (Token Generation Event) announcement of the Solv Protocol.
According to the official document, a project needs to obtain the deployment rights of the HIP-1 native token in order to go live on Hyperliquid. HIP-1 is the native token standard for spot trading on the protocol and creates on-chain spot order books, similar to ERC20 on Ethereum. But to obtain the permission to issue new tokens, projects usually need to participate in a Dutch auction, which is held every 31 hours, meaning that a maximum of 282 token codes can be deployed per year.
This auction fee can also be understood as the deployment Gas fee, which is currently paid in USDC. During the 31-hour auction period, the deployed Gas fee gradually decreases from the initial price, down to a minimum of 10,000 USDC. If the previous auction was not completed, the initial price will be 10,000 USDC; otherwise, the initial price will be twice the final Gas price of the previous auction. The introduction of this auction mechanism not only avoids the phenomenon of excessive speculation and irrational price increase due to overly high prices, but also can dynamically adjust the listing speed of new tokens based on demand. It is this mechanism that also ensures that the number of tokens on the Hyperliquid market will not be too many, and prioritizes high-quality projects for listing.
Looking at the past auction situation, ASXN data shows that as of December 10th, Hyperliquid has conducted more than 150 auctions since May this year. In terms of auction prices, Hyperliquid's airdrop has become an important turning point, with auction prices mostly below $25,000 before December, and even in the millions of dollars, and the token codes participating in the auctions were mostly MEME coins, such as PEPE, TRUMP, FUN, LADY and WAGMI, etc. But this month, the auction prices have risen sharply, with SOLV at around $128,000, SHEEP at around $112,000, BUBZ at around $118,000, and GENES at around $87,000. This also reflects that the market demand and interest in Hyperliquid has grown significantly after the airdrop hype.
However, in terms of the liquidity of the hundreds of HIP-1 tokens that have been launched, it is mainly concentrated in a few projects. Hyperliquid trading data shows that as of December 10th, the platform has launched hundreds of HIP-1 tokens, with a total trading volume of about $240 million in the past 24 hours, of which the Hyperliquid token HYPE accounts for 85.9% of the total trading volume, and the leading MEME project PURR accounts for more than 6.7%, while the remaining projects account for only 7.4% of the liquidity. This is related to Hyperliquid's main focus on derivatives trading, and the spot market has only gradually taken shape after the rise of MEME.
"Compared to CEX, the actual spot that can be traded on Hyperliquid is very limited now. If a major project wins the Hyperliquid spot seat through an auction, it is actually a strong alliance. As a on-chain exchange, we are happy to see more high-quality major projects go live or launch through auctions; the USDC capital sinking can also be more focused on the speculation of newly launched assets," Wu Blockchain analyst @defioasis recently analyzed.
Strong performance in multiple data metrics after the airdrop, may become a strong competitor for listing?
With its outstanding market performance and innovative listing strategy, Hyperliquid may become one of the important competitors for listing applications.
On the one hand, the wealth-creating effect of Hyperliquid's airdrop, as well as the continuous price increase of the token, have become the best marketing means, and the project's heat has surged, while Hyperliquid has shown strong performance in multiple data metrics.
In terms of token price performance, unlike the general situation of high opening and low closing for most projects after the airdrop, the fully diluted valuation (FDV) of Hyperliquid's token HYPE has been soaring. CoinGecko data shows that HYPE's market cap once reached $4.96 billion, and has since retreated slightly, with a current FDV of $13.21 billion, reaching a high of $14.85 billion.
At the same time, Hyperliquid has a strong competitive advantage in the derivatives DEX track. According to The Block's data on December 9th, Hyperliquid's trading volume reached $9.89 billion, accounting for 58.4% of the entire track (about $16.92 billion).
And Hyperliquid has also accumulated a large amount of assets. According to DeFiLlama data, as of December 10th, Hyperliquid Bridge's TVL reached $1.54 billion. With the platform's huge asset pool, if Hyperliquid lists more high-quality projects, it may further release its trading potential.
In addition, in terms of fundraising ability, Hyperliquid has shown strong profitability. According to research analysis by Yunt Capital's @stevenyuntcap, Hyperliquid's revenue includes immediate listing auction fees, profits and losses of HLP market makers, and platform fees, the first two of which are public information, but the team has recently explained the last revenue source. Based on this, Hyperliquid's revenue from the beginning of the year to now can be estimated at $44 million. When HYPE was launched, the team used the Assistance Fund wallet to buy HYPE in the market; assuming the team does not have multiple USDC AF wallets, the profit and loss of the USDC AF from the beginning of the year to now is $52 million. Therefore, adding the $44 million of HLP and the $52 million of USDC AF, Hyperliquid's revenue from the beginning of the year to now is about $96 million, exceeding Lido and becoming the 9th most profitable crypto project in 2024.
The above data also demonstrates Hyperliquid's attractiveness and competitiveness in the market.
On the other hand, Hyperliquid's listing mechanism is more transparent and fair. It is well known that the controversy over listing fees has a long history, including the recent widespread controversy in the circle caused by Binance and Coinbase over listing fees, with divergent views on listing fees.
The opposing view is that the ever-rising listing fees undoubtedly bring a heavy economic burden to the early development of projects, often having to sacrifice the long-term development potential of the project, which in turn affects the healthy development of the entire ecosystem. Arthur Hayes once revealed in his article that among the top CEXs, Binance charges up to 8% of the total token supply as a listing fee, while most other CEXs charge between $250,000 and $500,000, usually paid in stablecoins. He believes that CEXs charging listing fees is not wrong, as these platforms have invested a lot of money to accumulate a user base, which needs to be recouped. However, as an advisor and token holder, if the project gives the tokens to the CEX instead of the users, it will damage the future potential of the project and negatively impact the trading price of the tokens.
However, the supporting view is that listing fees are part of the exchange's operations and can be an effective tool for screening project quality. By charging a certain fee, the exchange can not only ensure the sustainable operation of the platform, but also ensure that the listed projects have a certain economic strength and market recognition, thereby reducing the influx of low-quality projects and maintaining market order and healthy development.
Here is the English translation:Regarding this, IOSG partner Jocy has published an article proposing several suggestions. First, exchanges need to strengthen information transparency and take severe punitive measures against projects with existing problems; secondly, exchanges should adopt departmental interest isolation to avoid conflicts of interest; finally, they must conduct due diligence carefully to ensure a diversified decision-making process and say "no" to any form of project fraud.
In addition to exchanges, project parties should not rely on CEX listings, but rather need to rely on user participation and market recognition. For example, Binance founder CZ recently stated, "We should strive to reduce such 'quote attacks' in the industry. Bitcoin has never paid any listing fees. Focus on the project, not the exchange." Arthur Hayes also stated that the biggest problem in the current token issuance is the initial price being too high. Therefore, no matter which CEX gets the first listing right, it is almost impossible to achieve a successful issuance. At the same time, for those project parties who are solely pursuing CEX listings, the tokens can only be sold to the listing trading platform once, but the positive flywheel effect formed by increasing user participation will continue to bring returns. Crypto researcher 0xLoki has also published an article stating that a good enough project will be listed by any exchange. If you need to accept extremely harsh terms to list on an exchange, you need to first consider the motivation of the project party: Is the project really good enough? What is the real purpose of listing on the exchange? Who will ultimately bear the cost?
Ultimately, the core issue regarding listing fees is the transparency and fairness of the fees, as well as the project's potential for sustainable development. Compared to the opacity and high costs of the CEX listing process, Hyperliquid's listing auction mechanism can reduce listing costs and enhance market fairness, ensuring that the assets on the platform have higher value and market potential. At the same time, Hyperliquid will return the listing fees to the community, which will also help to incentivize more users to participate in trading.
In summary, in the current market environment, how to balance listing fees and the long-term development of projects has become a core issue that the industry urgently needs to consider and solve.
