Track market-moving stories before they get noisy

According to Hyperinsight monitoring, ZEC has been strengthening, rising around 11.1% in 24 hours on Hyperliquid, with a trading volume of approximately $169 million. Since its opening price of $401.42 at the start of the month, ZEC has gained about 37.8% so far this month, currently trading at $553.10. This rally has once again made trader Loracle (0x8de) the on-chain top winner. He currently holds a 10x full-position long on ZEC, totaling 49,563.75 coins, with a notional value of around $27.414 million, an average entry price of $362.28, unrealized profit of about $9.458 million, and a return of roughly 526.7%. His account balance has surged by $6.836 million just today. It is reported that this position was built gradually over more than a month and a half. Loracle re-established his ZEC long base position on May 30; during ZEC's sharp decline due to negative catalysts from June 5 to 6, he bought the dip against the trend, expanding his position to 37,661.1 coins. By June 26, his holdings had increased to 49,564 coins, forming the main position. Since then, this address has fully captured all the upward momentum since July. -HyperInsight Bot is now live. Add @HyperInsightBot to your Telegram group and set it as an admin (enable message sending permission) to automatically sync on-chain news.

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Crypto Briefing approved image library

In a significant development on the Hyperliquid decentralized exchange, four large investors, commonly referred to as “whales,” have initiated long positions on the platform’s native token, $HYPE, within the past six hours. These transactions collectively total $89,500. Notably, three of these investors appeared to act in coordination, while one whale’s activity was linked to a previously tracked wallet. This synchronized movement suggests a potential coordinated strategy or a shared optimistic outlook on $HYPE’s future performance.

The activity coincides with $HYPE in the range of $63 to $68, supported by a 24-hour volume exceeding $360 million. The observed whale activity is consistent with a broader 2026 trend where large holders on Hyperliquid have been increasing their long positions, with the platform reporting record net-long positioning. Such movements highlight $HYPE’s evolving role as an integral governance and incentive token within the rapidly expanding Hyperliquid ecosystem.

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This latest round of whale activity may indicate increased confidence in $HYPE’s value trajectory. However, market participants appear to have a mixed outlook on whether Hyperliquid will reach the $100 mark by the end of 2026, as reflected in current market pricing.

Key Takeaways Recent whale activity on Hyperliquid suggests heightened interest in $HYPE, consistent with a potentially positive market outlook. The coordinated actions of three whales and the involvement of a tracked wallet indicate a possible shared market view. Despite this activity, current market pricing implies uncertainty about $HYPE reaching $100 by December 31, 2026. What to Watch Observers should monitor further whale activity and whether additional large investors follow suit, which could influence broader market sentiment toward $HYPE. Key events such as announcements of new partnerships, changes in volume, or regulatory developments could also impact the market’s view on whether Hyperliquid will achieve the $100 price target. Continued analysis of on-chain patterns will be crucial in assessing future price movements.

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Term Structure

Contract Odds Δ since publish Volume 24h December 31 30.5% — — View market → January 1 2027 5.7% — — View market → January 1 2027 4% — — View market → January 1 2027 69.5% — — View market → January 1 2027 9.1% — — View market → January 1 2027 4.5% — — View market →

English繁體中文한국어日本語ไทยPortuguêsItalianoDeutschFrançaisEspañol Hyperliquid founder Jeff Yan has positioned the decentralized exchange as a potential “AWS of finance,” arguing that the protocol can become a foundational infrastructure layer for trading, liquidity and financial applications in the same way Amazon Web Services became core infrastructure for internet startups.

The comparison reflects Yan’s broader ambition for Hyperliquid: to move beyond a single perpetual futures exchange and become a high-performance financial backend where developers can build markets, applications and trading products. According to Fortune and other market reports, Yan views Hyperliquid as financial infrastructure that can support not only crypto assets, but also tokenized versions of stocks, commodities, prediction markets and other instruments.

Hyperliquid has become one of the most closely watched projects in decentralized finance because it combines an onchain order book, perpetual futures, spot trading, the HYPE token and its own Layer 1 blockchain. Unlike many DeFi protocols that rely on automated market makers, Hyperliquid was designed to look and feel more like a centralized exchange while preserving onchain settlement and self-custody.

The platform’s rise has been unusually rapid. Reports have described Hyperliquid as a lean operation built by a team of roughly a dozen people, with no traditional venture-capital backing and a large user-focused HYPE airdrop. Its growth has pushed it into direct comparison with centralized derivatives venues and helped make decentralized perpetuals one of crypto’s most competitive sectors.

From Exchange to Infrastructure The AWS analogy matters because it changes how investors and developers evaluate Hyperliquid. If the project is only a crypto exchange, its value depends mainly on trading volume, fees and market share. If it becomes infrastructure, the opportunity expands to third-party applications, custom markets, liquidity services and settlement rails.

That shift is already visible in Hyperliquid’s product roadmap. HIP-3, the protocol’s builder-deployed perpetuals framework, allows developers to launch their own perpetual markets by defining market parameters, oracle rules, leverage limits and settlement processes. Hyperliquid’s documentation describes HIP-3 as a key step toward decentralizing the listing process for perpetual markets.

This is where the AWS comparison becomes more practical. AWS gave startups access to computing, storage and networking without building data centers. Hyperliquid’s equivalent pitch is that builders should not need to create matching engines, liquidity systems, risk engines and settlement infrastructure from scratch. They can deploy financial markets on top of a shared base layer.

That model could support markets tied to crypto tokens, equities, commodities, pre-IPO companies, prediction events or synthetic assets. Recent reports have already highlighted trading activity around non-crypto products, including oil-linked and private-company-related contracts built around Hyperliquid’s infrastructure.

Regulatory and Execution Risks Remain The vision is ambitious, but it carries significant risks. Hyperliquid operates in a regulatory grey zone compared with licensed U.S. venues. Perpetual futures remain tightly controlled in many jurisdictions, and U.S. users are not supposed to access offshore platforms that do not meet domestic regulatory requirements. Reports have noted that some users may attempt to bypass geofencing through VPNs, which could increase scrutiny.

There are also market-structure questions. High-leverage perpetuals can amplify volatility, liquidations and retail losses. If Hyperliquid expands into tokenized stocks, commodities or prediction markets, it may attract attention from securities, commodities and gambling regulators. The more Hyperliquid resembles a universal financial exchange, the more likely it is to face institutional regulatory pressure.

Execution risk is another factor. AWS became dominant by offering reliability, scale, developer tooling and enterprise trust. Hyperliquid must prove similar qualities in a much harder environment: real-time trading, liquidations, oracle integrity, validator security and market-maker participation. Any outage, manipulation event or governance controversy could weaken the infrastructure thesis.

Still, Yan’s framing captures why Hyperliquid has become central to the DeFi debate. The project is not merely trying to improve decentralized trading. It is trying to turn financial markets into programmable, permissionless infrastructure.

If Hyperliquid can sustain liquidity, expand developer adoption and navigate regulatory pressure, the AWS comparison may become more than a slogan. It could define the next phase of onchain finance.

English繁體中文한국어日本語ไทยPortuguêsItalianoDeutschFrançaisEspañol Il fondatore di Hyperliquid, Jeff Yan, ha posizionato l’exchange decentralizzato come un potenziale “AWS della finanza”, sostenendo che il protocollo possa diventare uno strato infrastrutturale fondamentale per il trading, la liquidità e le applicazioni finanziarie, così come Amazon Web Services è diventata infrastruttura centrale per le startup di internet.

Il paragone riflette l’ambizione più ampia di Yan per Hyperliquid: andare oltre un semplice exchange di future perpetui e diventare un backend finanziario ad alte prestazioni dove gli sviluppatori possano costruire mercati, applicazioni e prodotti di trading. Secondo Fortune e altri report di mercato, Yan considera Hyperliquid un’infrastruttura finanziaria capace di supportare non solo asset cripto, ma anche versioni tokenizzate di azioni, materie prime, prediction market e altri strumenti.

Hyperliquid è diventato uno dei progetti più seguiti nella finanza decentralizzata perché combina un order book onchain, future perpetui, trading spot, il token HYPE e una propria blockchain Layer 1. A differenza di molti protocolli DeFi che si basano su market maker automatizzati, Hyperliquid è stato progettato per assomigliare a un exchange centralizzato, pur mantenendo il regolamento onchain e l’autocustodia.

L’ascesa della piattaforma è stata insolitamente rapida. Alcuni report hanno descritto Hyperliquid come un’operazione snella costruita da un team di circa una dozzina di persone, senza il sostegno tradizionale di venture capital e con un ampio airdrop di HYPE orientato agli utenti. La sua crescita l’ha portato a confrontarsi direttamente con le piattaforme derivate centralizzate, contribuendo a rendere i perpetui decentralizzati uno dei settori più competitivi del mondo cripto.

Da exchange a infrastruttura L’analogia con AWS è rilevante perché cambia il modo in cui investitori e sviluppatori valutano Hyperliquid. Se il progetto fosse solo un exchange cripto, il suo valore dipenderebbe principalmente dal volume di trading, dalle commissioni e dalla quota di mercato. Se invece diventasse infrastruttura, l’opportunità si estenderebbe ad applicazioni di terze parti, mercati personalizzati, servizi di liquidità e sistemi di regolamento.

Questo cambiamento è già visibile nella roadmap dei prodotti di Hyperliquid. HIP-3, il framework del protocollo per i perpetui distribuiti dagli sviluppatori (builder-deployed), consente ai developer di lanciare i propri mercati perpetui definendo parametri di mercato, regole degli oracoli, limiti di leva finanziaria e processi di regolamento. La documentazione di Hyperliquid descrive HIP-3 come un passo fondamentale verso la decentralizzazione del processo di quotazione dei mercati perpetui.

È qui che il confronto con AWS diventa più concreto. AWS ha dato alle startup accesso a capacità di calcolo, storage e networking senza dover costruire data center. La proposta equivalente di Hyperliquid è che gli sviluppatori non debbano creare da zero motori di matching, sistemi di liquidità, motori di rischio e infrastrutture di regolamento. Possono invece implementare mercati finanziari sopra uno strato di base condiviso.

Questo modello potrebbe supportare mercati legati a token cripto, azioni, materie prime, società pre-IPO, eventi di prediction market o asset sintetici. Report recenti hanno già evidenziato attività di trading su prodotti non cripto, inclusi contratti legati al petrolio e a società private costruiti sull’infrastruttura di Hyperliquid.

Restano i rischi regolatori ed esecutivi La visione è ambiziosa, ma comporta rischi significativi. Hyperliquid opera in una zona grigia dal punto di vista normativo rispetto alle piattaforme statunitensi autorizzate. I future perpetui restano strettamente regolamentati in molte giurisdizioni, e gli utenti statunitensi non dovrebbero accedere a piattaforme offshore che non soddisfano i requisiti normativi nazionali. Alcuni report hanno segnalato che alcuni utenti potrebbero tentare di eludere il geofencing tramite VPN, il che potrebbe aumentare il livello di controllo da parte delle autorità.

Ci sono anche interrogativi sulla struttura di mercato. I perpetui ad alta leva finanziaria possono amplificare la volatilità, le liquidazioni e le perdite dei trader retail. Se Hyperliquid si espandesse verso azioni tokenizzate, materie prime o prediction market, potrebbe attirare l’attenzione delle autorità di vigilanza su titoli, materie prime e gioco d’azzardo. Quanto più Hyperliquid assomiglierà a un exchange finanziario universale, tanto maggiore sarà la probabilità di dover affrontare pressioni regolatorie istituzionali.

Anche il rischio esecutivo è un fattore da considerare. AWS è diventata dominante offrendo affidabilità, scalabilità, strumenti per gli sviluppatori e fiducia a livello enterprise. Hyperliquid deve dimostrare qualità simili in un contesto molto più complesso: trading in tempo reale, liquidazioni, integrità degli oracoli, sicurezza dei validatori e partecipazione dei market maker. Qualsiasi interruzione, episodio di manipolazione o controversia di governance potrebbe indebolire la tesi infrastrutturale.

Ciò nonostante, l’impostazione di Yan spiega perché Hyperliquid sia diventato centrale nel dibattito sulla DeFi. Il progetto non si limita a voler migliorare il trading decentralizzato: sta cercando di trasformare i mercati finanziari in un’infrastruttura programmabile e senza permessi (permissionless).

Se Hyperliquid riuscirà a mantenere la liquidità, ad ampliare l’adozione da parte degli sviluppatori e a gestire le pressioni normative, il paragone con AWS potrebbe rivelarsi più che uno slogan: potrebbe definire la prossima fase della finanza onchain.

Hyperliquid has added a pre-IPO perpetual market linked to ChangXin Memory Technologies, or CXMT, giving traders synthetic exposure to the Chinese chipmaker before its Shanghai debut.

Summary

Hyperliquid listed a CXMT pre-IPO perpetual as the chipmaker prepares its July 27 Shanghai debut. CXMT’s contract price near $8 implied a $535 billion valuation, 526% above its IPO price. The market offers synthetic exposure, not ownership of CXMT shares listed on Shanghai’s STAR Market. The contract, listed as xyz, traded near $8 on July 15, according to on-chain market data cited by Hyperinsight. Applied to CXMT’s expected post-IPO share count of 66.881 billion shares, that price implies a valuation near $535 billion, about 6.3 times its official IPO valuation.

Hyperliquid Lists CXMT, Potentially A-Share’s Largest IPO and 4th-Largest DRAM Maker

Following the listing of the “CSI STAR Market 50 ETF”, Hyperliquid has officially added ChangXin Memory Technologies (CXMT). As A-share listings such as CXMT on the STAR Market require a RMB… pic.twitter.com/eGSQvziPpZ

— Wu Blockchain (@WuBlockchain) July 15, 2026 Hyperliquid opens a synthetic route to CXMT The CXMT contract operates through Hyperliquid’s HIP-3 framework, which allows outside deployers to create perpetual markets linked to assets beyond cryptocurrencies. These markets trade as derivatives rather than spot securities, so the CXMT contract does not provide ownership, dividends or voting rights in the Shanghai-listed company.

Individual investors on China’s STAR Market generally face a RMB 500,000 asset threshold and a two-year trading-experience requirement. Hyperliquid offers a separate synthetic market that can give eligible users price exposure without access to the underlying A-share. The distinction also means the contract price can differ sharply from CXMT’s official share price.

CXMT contract trades far above IPO valuation CXMT priced its IPO at RMB 8.66 per share and expects to raise about RMB 57.9 billion, or $8.55 billion, before any over-allotment option. Reuters reported that the deal will be Asia’s largest IPO of 2026 so far and China’s biggest A-share semiconductor offering, surpassing SMIC’s 2020 share sale.

At the offer price, CXMT’s expected post-listing value is about RMB 579.2 billion, or roughly $85.5 billion. A synthetic price near $8 implies about $535 billion, placing the Hyperliquid contract around 526% above the dollar equivalent of the IPO price. The gap reflects pricing in a separate derivatives market and does not set CXMT’s official equity valuation.

China’s largest DRAM maker prepares for listing CXMT is China’s largest DRAM producer and ranks fourth globally, behind Samsung Electronics, SK Hynix and Micron. Recent market estimates place its global DRAM share near 8%. The company has expanded as China invests heavily in domestic semiconductor production and demand for memory chips grows alongside artificial intelligence infrastructure.

Reuters also reported that CXMT secured a long-term memory supply agreement with Tencent worth more than RMB 20 billion, or about $2.94 billion. Investor subscriptions for the STAR Market offering begin on July 16, while the shares are scheduled to start trading in Shanghai on July 27. CXMT plans to use the IPO proceeds for production and technology investment.

Hyperliquid widens its real-world asset markets Hyperliquid’s HIP-3 framework allows builders to launch perpetual markets linked to stocks, commodities and other real-world assets. A pre-IPO SpaceX contract also traded through the framework, showing how on-chain derivatives can create markets around companies before their public shares become available.

Hyperliquid has also expanded its connection to tokenized securities. As reported by crypto.news, Ondo Finance brought 35 tokenized U.S. stocks and ETFs to HyperEVM in June. Those products differ from the CXMT perpetual because tokenized securities can use structures backed by assets held through custodians, while perpetuals provide synthetic price exposure.

The CXMT market gives traders another route to speculate on a major public offering before its debut. Attention will now turn to whether the 526% premium narrows before subscriptions start and after the underlying shares begin trading on the STAR Market.

Crypto Briefing approved image library

Bitcoin exchange-traded funds (ETFs) have seen massive outflows, with net losses reaching over $8.2 billion. Despite this trend, enthusiasm for the decentralized derivatives exchange Hyperliquid, established in 2024, is on the rise. Hyperliquid’s native token, HYPE, has maintained its value near $67–$68, reflecting market participants’ interest. Observers suggest this dynamic could indicate a capital shift from traditional Bitcoin exposure to newer options such as HYPE spot ETFs, which have attracted around $172 million in net inflows since mid-May 2026.

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Institutional interest in Hyperliquid is further supported by its protocol tokenomics, which allocate nearly all revenue towards token buybacks and burns. The inclusion of HYPE in the Bitwise 10 Crypto Index ETF has also contributed to its appeal. This escalating interest in Hyperliquid appears to align with market participants’ expectations for its future performance, as evidenced by the pricing in prediction markets.

Key Takeaways Markets suggest a capital rotation from Bitcoin ETFs to Hyperliquid, evidenced by significant inflows into HYPE spot ETFs. Hyperliquid’s tokenomics and inclusion in the Bitwise 10 Crypto Index ETF appear to enhance its attractiveness to institutional investors. The prediction market for Hyperliquid reaching $100 by the end of 2026 has seen adjustments, with the current probability at 30.5% YES. What to Watch Market participants will be monitoring whether the trend of inflows into Hyperliquid continues, especially as Bitcoin ETFs face ongoing outflows. Key developments such as the announcement of partnerships or technological innovations by Hyperliquid could influence market sentiment and pricing. Additionally, any regulatory changes or security issues impacting Hyperliquid might shift market dynamics, potentially affecting its probability of reaching the $100 price target by December 31, 2026.

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Term Structure

Contract Odds Δ since publish Volume 24h December 31 30.5% — — View market → January 1 2027 5.7% — — View market → January 1 2027 4% — — View market → January 1 2027 69.5% — — View market → January 1 2027 9.1% — — View market → January 1 2027 4.5% — — View market →

Table of contents

The SEC’s crypto task force has taken a meeting that didn’t start with a subpoena. On July 14, staff from the task force sat down with representatives of the Hyperliquid Policy Center, XYZ Ltd., and law firm Sullivan & Cromwell to go over a document detailing the Hyperliquid protocol’s technology, its markets, and the participants building on it. The meeting was requested by the crypto side—a proactive move that signals some DeFi teams are trying to get ahead of enforcement rather than wait for it, according to a report from WuBlockchain.

Hyperliquid Labs, the development contributor to the protocol, participated alongside XYZ, a research and product lab that also operates as a HIP-3 deployer for traditional-asset perpetual markets. That last role—building perpetuals that track things like stocks or commodities—puts the conversation directly in the crosshairs of current regulatory debates. Sullivan & Cromwell’s presence adds legal weight, suggesting this was not a casual introductory call but a deliberate attempt to shape the SEC’s thinking before the agency makes up its mind about how to classify these products.

Perpetual Swaps Meet Real-World Assets Hyperliquid has carved out a niche as a high-speed DeFi layer that hosts perpetual futures with institutional-grade throughput. The platform’s HIP-3 deployer function allows teams to list markets referencing traditional assets, not just crypto pairs. That blurs the line between a decentralized exchange and a securities venue. For the SEC, the question is whether fully on-chain perpetuals that track stocks or ETFs fall under swap regulation, securities law, or something else entirely. The document discussed at the meeting—covering technology, market structure, and ecosystem participants—reads like the kind of filing a project might submit if it were seeking a no-action letter or laying groundwork for a registration path.

Regulators have been increasingly focused on decentralized derivatives, especially as volumes on platforms like Hyperliquid rival those of mid-tier centralized exchanges. A meeting of this nature suggests the task force is at least willing to examine how the code works rather than issuing blanket statements. That doesn’t guarantee a friendly outcome, but it’s a departure from the enforcement-first rhythm that defined earlier crypto-related interactions.

A Collaborative Approach or Just Fact-Finding? Several current threads make the timing notable. A landmark crypto bill is facing last-minute banking opposition in the Senate, threatening to stall comprehensive market structure rules. At the same time, tokenized real-world assets crossed $20 billion on-chain last quarter, pushing the conversation about regulated DeFi access to traditional instruments into a more urgent phase. Against that backdrop, Hyperliquid’s move to brief the SEC on its own architecture before any enforcement action lands is a calculated bet on transparency over legal brinkmanship.

The uncertainty is real. Nothing in the meeting record indicates the SEC has changed its view on what constitutes a security or an unregistered exchange. The task force may simply be collecting information to refine future charges, not to grant safe passage. Still, the fact that the discussion covered the protocol’s ecosystem—not just a narrow legal theory—hints that the SEC is digging into how markets actually function on these rails. That kind of granular review can delay aggressive action, especially when the technology doesn’t fit neatly into legacy boxes.

What Builders and Traders Should Watch For the broader crypto market, the meeting adds a data point to the slow-moving push for regulatory clarity on decentralized derivatives. Hyperliquid’s developer activity has climbed in recent weeks, placing it among the top blockchains by developer engagement. If the protocol can demonstrate that its perpetual markets are operationally distinct from centralized order-book venues and that its traditional-asset markets have built-in controls, it could set a template other DeFi teams might follow when approaching the SEC. The involvement of Sullivan & Cromwell also suggests that well-resourced legal counsel is now dedicating serious hours to finding a workable path through US regulation, rather than simply advising clients to shift operations offshore.

No conclusions are on the table yet. The meeting could lead to further technical walkthroughs, a formal request for comments, or nothing at all. But for an industry accustomed to waking up to Wells notices, a scheduled meeting with the SEC’s crypto task force—requested by the project itself—is a signal worth noting.

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Mysterious crypto writer with expertise in blockchain, offering deep insights that captivate and intrigue readers. With a unique ability to uncover hidden insights and trends, Samuel delivers in-depth analysis and thought-provoking content that keeps readers on the edge of their seats. His writing style is engaging and informative, blending technical knowledge with a sense of intrigue, making complex crypto topics accessible to both newcomers and seasoned industry professionals. Samuel’s work continues to capture the attention of the crypto community, solidifying his reputation as a trusted voice in the space.

Hyperliquid, a decentralized perpetuals protocol operating on its own Layer 1 blockchain, is preparing to update its market structure in 2026 as trading activity shifts rapidly toward its open market system. Recent data shows that HIP-3, the network’s permissionless perpetuals market, has surged to account for nearly 50% of Hyperliquid’s daily trading volume, marking a significant increase from about 2% at the start of the year.

With the introduction of HIP-3, Hyperliquid enabled any developer or community to launch perpetuals markets on its platform without the need for central approval. This marks a departure from the traditional exchange-led listing process and reflects a broader trend in decentralized finance favoring open market creation and greater accessibility.

The HIP-3 system relies on an order book structure, using USDC as collateral and managing risk through shared liquidity pools and vaults. This framework has facilitated the rapid proliferation of niche derivatives products and allowed for increased user participation in assets that might not be listed on conventional exchanges.

Mini dictionary: Hyperliquid is a decentralized perpetuals trading platform that allows users to trade crypto derivatives without relying on a centralized operator. It offers both traditional and permissionless markets and operates its own Layer 1 blockchain.

Interest in long-tail and small-cap derivatives has increased as users are able to trade these assets without passing through typical listing hurdles. Permissionless perpetuals lower entry barriers for early-stage crypto projects and investors seeking new market opportunities.

HIP-3 permissionless perp markets have grown to nearly half of Hyperliquid’s daily volume, a substantial rise from just 2% at the beginning of the year.

Strategic growth and competitionThe shift toward open derivatives markets has not only expanded Hyperliquid’s product suite but also helped the platform tap into new revenue streams. By catering to niche asset classes, Hyperliquid is positioning itself to withstand competition from both centralized exchanges such as Binance and decentralized rivals including dYdX and GMX.

Recent surges in trading volume on alternative chains like Solana have underscored the intensity of competition in the decentralized derivatives sector, pushing platforms to continuously innovate in order to retain user interest.

PlatformCore MechanismMain CompetitorsHyperliquid (HIP-3)Order book, permissionless perpsdYdX, GMXBinanceCentralized exchange, vetted listingsOKX, BybitSolanaLayer 1, high trading volume, ecosystem perpsEthereum, Arbitrum protocolsChallenges and regulatory landscapeIndustry experts see the evolving landscape as part of a larger shift toward on-chain derivatives and alternatives to major centralized exchanges. However, in regions like the US and EU, the regulatory environment for decentralized perpetuals remains uncertain, leaving questions about long-term compliance and growth.

Going forward, Hyperliquid is focused on closely monitoring the performance of its vaults and evaluating cross-margin risk management. Another area under review is whether the liquidity provided by HIP-3 can remain resilient in volatile market conditions.

The platform’s long-term acceptance may depend on the appeal of market-making incentives, the availability of advanced tools, and the stance that regulators ultimately take regarding the legal status of permissionless derivatives.

The degree of market participation and regulatory clarity will play a pivotal role in shaping the future of permissionless derivatives on Hyperliquid and similar platforms.

Disclaimer: The information contained in this article does not constitute investment advice. Investors should be aware that cryptocurrencies carry high volatility and therefore risk, and should conduct their own research.

https://seas.harvard.edu/tour/allston/1/science-and-engineering-complex-sec

The U.S. Securities and Exchange Commission’s (SEC) Crypto Task Force recently convened with representatives from the Hyperliquid Policy Center and Trade[XYZ] to discuss approaches to crypto asset regulation. This meeting, as revealed by a newly released memo, reflects ongoing efforts to develop legal frameworks for decentralized perpetual derivatives and on-chain market infrastructures. Hyperliquid, a decentralized derivatives platform, has been advocating for clearer regulatory oversight, including the potential involvement of the Commodity Futures Trading Commission (CFTC). This meeting underscores intensified industry lobbying to influence the shaping of federal rules for decentralized finance (DeFi) derivatives, which have faced significant regulatory hurdles in the U.S.

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Market pricing suggests that the SEC meeting may be seen as a positive step towards regulatory clarity for Hyperliquid. The current market odds for Hyperliquid reaching $100 by the end of 2026 have seen a decline, with the probability now at 30%, down from 39% just 24 hours ago. Despite this, the meeting could indicate a future environment more conducive to growth if regulatory frameworks become more defined.

Key Takeaways The SEC’s meeting with Hyperliquid and Trade[XYZ] appears to indicate ongoing efforts to clarify regulatory frameworks for crypto assets. Market pricing suggests that participants view this as a potential positive development for Hyperliquid’s regulatory environment. The probability of Hyperliquid reaching $100 by the end of 2026 has declined recently, but the meeting could suggest future regulatory support. What to Watch Market participants will be closely monitoring any public statements or policy shifts from the SEC or CFTC that suggest increased regulatory clarity for decentralized derivatives. The impact of this meeting on Hyperliquid’s competitive position will depend on how these discussions translate into actual regulatory changes. Further announcements or partnerships from Hyperliquid could also influence market perceptions and pricing dynamics.

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Term Structure

Contract Odds Δ since publish Volume 24h December 31 30% — — View market → January 1 2027 5.7% — — View market → January 1 2027 4% — — View market → January 1 2027 66.5% — — View market → January 1 2027 9.2% — — View market → January 1 2027 4.5% — — View market →

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14 July 2026 | 23:44 Representatives connected to the Hyperliquid ecosystem met with the U.S. Securities and Exchange Commission’s Crypto Task Force on July 14, 2026, bringing the architecture of decentralized perpetual markets into the agency’s regulatory discussions.

Key Takeaways SEC task force met Hyperliquid ecosystem representatives. Talks focused on decentralized perpetual market regulation. HIP-3 separates market deployment from core execution. Meeting confirms engagement, not regulatory approval. U.S. access still requires concrete regulatory action. According to the SEC’s official meeting memorandum, the participants represented the Hyperliquid Policy Center, XYZ Ltd. and Sullivan & Cromwell LLP. The stated topic was how regulators could address issues involving crypto assets.

What the SEC Filing Actually Confirms The attached meeting request sought to brief the task force on the Hyperliquid protocol’s technology, markets and relevant ecosystem participants. It described Hyperliquid Labs as a software contributor and XYZ as a research and product laboratory operating a HIP-3 deployment for traditional-asset perpetual markets.

The proposed attendee list included Hyperliquid Policy Center CEO Jake Chervinsky, policy counsel Bradley Bourque, Hyperliquid founder Jeff Yan, XYZ representative Collins Belton and four lawyers from Sullivan & Cromwell.

The disclosure is more limited than a formal policy proposal. It does not publish a detailed technical presentation, identify specific exemptions requested from the SEC or record any commitments made by the agency. The meeting therefore confirms regulatory engagement, not approval of Hyperliquid, HIP-3 products or access for U.S. traders.

HIP-3 Separates Market Design From Trade Execution The policy question is complicated by how responsibilities are distributed under Hyperliquid Improvement Proposal 3.

HIP-3 allows independent builders to deploy perpetual markets without relying on a centralized listing committee. Each deployer is responsible for several functions that would normally sit with a derivatives venue:

Market definition: selecting the reference asset, contract specifications and oracle methodology. Risk controls: setting leverage limits and determining whether an asset is eligible for cross-margin treatment. Market operation: publishing oracle prices and settling or halting the contract when necessary. A mainnet deployer must maintain a stake of 500,000 HYPE. Validators can slash that stake through a weighted vote when irregular deployer inputs harm protocol correctness, uptime or performance. Slashed tokens are burned rather than distributed as compensation to affected traders.

Trade execution remains inside HyperCore, Hyperliquid’s native trading system. It provides the order books and margining infrastructure, although every HIP-3 exchange retains independent settings and its own market configuration. Cross-margining is not automatic: enabling it is irreversible and requires sufficient external liquidity, a dependable oracle and resistance to price manipulation.

XYZ illustrates that division of responsibilities. Its technical documentation states that HyperCore manages matching, order types, funding, liquidations and auto-deleveraging. XYZ supplies the bespoke oracle, mark price and external price used for its markets through distributed relayers that submit updates approximately every three seconds.

These contracts provide synthetic exposure rather than ownership of the referenced asset. An equity perpetual settled in USDC does not deliver the underlying share, making it legally and economically different from a tokenized security representing ownership rights. The distinction leaves regulators with separate questions around the derivative itself, the trading infrastructure, the oracle operator and any interface providing access.

The regulatory discussion is unfolding as Hyperliquid becomes more important to the economics of stablecoin distribution. JPMorgan recently lowered its earnings estimates for Circle and Coinbase, arguing that their revised USDC arrangement with Hyperliquid could pressure margins as both companies seek to preserve the stablecoin’s dominant position on the platform. The frequently cited $160 million figure represents estimated reserve yield that could be redirected under the arrangement, rather than a confirmed net loss.

The SEC Agenda Offers a Framework, Not a HIP-3 License The meeting took place one week after SEC Chair Paul Atkins published a statement on the agency’s 2026 Regulatory Agenda. Atkins said the Commission intends to establish clearer rules for crypto fundraising, custody and the trading of tokenized securities onchain.

Three pending workstreams are relevant to the broader Hyperliquid discussion: The SEC is considering exemptions and safe harbors for crypto-asset offerings. Proposed amendments could apply broker-dealer net-capital, customer-protection and recordkeeping rules to crypto-asset activities under Rules 15c3-1 and 15c3-3. A separate project would adapt Exchange Act rules for crypto trading on alternative trading systems and national securities exchanges. None of those entries expressly creates a pathway for permissionless perpetual markets. The SEC’s agenda primarily concerns securities offerings, broker-dealers and securities-trading venues, while the operation of derivatives markets also raises Commodity Exchange Act questions overseen by the Commodity Futures Trading Commission.

Hyperliquid’s policy effort is consequently proceeding on both tracks. In a July 9 submission to the CFTC, the Hyperliquid Policy Center and Phantom asked the derivatives regulator to distinguish software development from regulated financial intermediation.

Their proposed model would keep registration and compliance obligations with entities that handle customer orders, control funds or enter transactions, rather than automatically imposing them on developers publishing protocol code. The submission also called for regulated exchanges, clearing organizations and futures commission merchants to be allowed to use public blockchain infrastructure, subject to their existing market-surveillance, segregation and customer-protection duties.

U.S. Access Still Depends on Concrete Regulatory Action The SEC meeting creates a channel for explaining how Hyperliquid divides functions among validators, deployers, interfaces and users. It does not resolve which participants would need registration when a HIP-3 market references equities, indices or other traditional assets.

The current TradeXYZ disclaimer states that its interface is unavailable to U.S. persons. Changing that position would require more than a policy discussion: regulators would need to define the accountable entity for listing, market surveillance, oracle governance, margining, customer access and settlement.

Evidence of substantive progress would include a proposed SEC or CFTC rule covering onchain market infrastructure, formal guidance separating protocol development from market operation, registration by a venue using HyperCore or published exemptive relief addressing non-custodial access. Until one of those steps occurs, the July 14 session should be treated as regulatory engagement rather than authorization.

The information provided in this article is for educational purposes only and does not constitute financial, investment, or trading advice.

Author

Kosta has reported on cryptocurrency markets and blockchain infrastructure since 2020, bringing over six years of hands-on experience in the crypto industry built through daily tracking of markets, trends, and emerging blockchain developments. Specializing in Bitcoin on-chain analysis, institutional ETF flows, and digital asset price action, his work at Coindoo has been cited by other news agencies and consistently covers market developments with a focus on data-driven reporting across Bitcoin, Ethereum, Solana, and XRP. Over the years, Kosta has contributed to multiple crypto media outlets in different regions, authoring over 6,000 articles across the sector. His reporting spans cryptocurrency markets and the broader fintech industry, tracking not only price action but also the technological and regulatory forces shaping the ecosystem. To support his analysis, Kosta actively leverages on-chain data and metrics from leading platforms such as Santiment, Glassnode, and CryptoQuant, enabling deeper, evidence-based market insights. He believes in the power of transparency and the data that underpins the blockchain ecosystem. His academic background in Marketing Management from Denmark further complements his analytical approach, adding a strong understanding of communication strategy and content positioning to his work.

Not financial or tax advice. PANews content is strictly educational and informational and is not investment advice, financial advice, tax advice, legal advice, or a solicitation to buy or sell any digital asset, security, or financial product. Do your own research and consult qualified advisers.

Disclosure. PANews may publish sponsored content, partner content, advertisements, affiliate links, event promotions, and market commentary involving Web3 projects, service providers, or financial products. PANews personnel, contributors, or affiliates may hold digital assets or other interests related to covered topics. See our Terms of Service.

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JPMorgan Chase & Co., the largest bank in the world by market capitalization, has sounded the alarm about Coinbase and Circle’s USDC-based revenue in their partnership with Hyperliquid.

USDC alliance expected to slash Coinbase and Circle earningsAccording to the bank’s July 2026 report, the partnership among the three crypto players creates a prisoner’s dilemma. Essentially, Coinbase and Circle are competing for the distribution of the stablecoin to increase their revenue.

“We think the change in the Hyperliquid relationship showcases the challenge for Circle and Coinbase partnership agreements because it can create ‘a prisoner’s dilemma’ that drives Coinbase and Circle to compete with each other when promoting USDC distribution,” analysts led by Kenneth Worthington said in the Tuesday report.

Hyperliquid is currently the largest decentralized exchange, boasting over $150 billion in processed transactions this July. In the same month, the Hyperliquid-Binance volume ratio officially surpassed the 11.89% milestone, following a 47% month-over-month surge in Hyperliquid’s trading volume. At present, Hyperliquid holds about $6 billion in USDC, or about 8% of the stablecoin’s circulating supply.

Two months ago, the trio entered into an agreement in which Coinbase became the official USDC liquidity manager on Hyperliquid. Meanwhile, Circle managed cross-chain infrastructure and minting to reduce third-party risk. 

In return, Coinbase would route 90% of the stablecoin yield back to Hyperliquid. The exchange then uses these funds to conduct regular HYPE token buybacks, thereby boosting the token’s value. This arrangement overturned a previous contract in which Coinbase split nearly all of the stablecoin’s revenue evenly with Circle.

More reasons for lower returnsWeaker crypto markets have also cut stablecoin yields, with USDC supply now down to $73 billion from around $80 billion in March. Even more, the crypto industry is continuously incorporating regulated stablecoins, chipping away at Circle’s USDC’s previous dominance. 

Japanese investment bank Mizuho notes that while Circle’s approval to open a bank is positive, investors may be overvaluing it.

Whether JPMorgan’s warnings hold any weight remains to be seen once Coinbase and Circle release their Q2 earnings reports on July 30 and August 11, respectively.

Story Ends Here

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Read the Next News

What Did JPMorgan Actually Say?Analysts led by Kenneth Worthington said the Hyperliquid deal created a structural problem for the Circle-Coinbase partnership. 

Under the new arrangement, Coinbase classifies USDC held on Hyperliquid as “on-platform,” collects the reserve income, and pays 90% of it directly to Hyperliquid.

Previously, Coinbase split nearly all of that revenue evenly with Circle.

“We think the change in the Hyperliquid relationship showcases the challenge for Circle and Coinbase partnership agreements because it can create a prisoner’s dilemma that drives Coinbase and Circle to compete with each other when promoting USDC distribution,” Worthington wrote.

The problem is structural. Every time Coinbase chases a major distribution partner by offering better revenue terms, it cuts into Circle’s share. 

Every time Circle tries to protect its economics, it risks losing distribution. Both sides are now incentivized to undercut each other to secure the next Hyperliquid-scale deal.

Why Does Hyperliquid Make This A Bigger Deal Than It Looks?Hyperliquid has grown into one of crypto’s largest trading venues, processing more than $150 billion in trading volume in July alone. 

Its volume relative to Binance climbed to 11.5%, and USDC balances on the platform have swelled to roughly $6 billion, representing about 8% of the entire circulating USDC supply.

That scale makes Hyperliquid an increasingly important distribution channel, which is exactly why Coinbase was willing to offer 90% of reserve yields to secure it. 

The more platforms of this size emerge, the more pressure Circle and Coinbase face to keep offering similar terms elsewhere.

How Much Has USDC Already Lost?USDC’s circulating supply has fallen from nearly $80 billion in March to around $73 billion, part of a broader $10 billion contraction in the stablecoin market since May. 

Crypto trading activity cooled while new regulated rivals chipped away at both USDC and Tether’s USDT dominance.

JPMorgan cut earnings estimates for both Circle and Coinbase citing the Hyperliquid agreement alongside weaker crypto markets, though the bank noted higher interest rates provide some support for USDC-related revenue over the longer term.

Mizuho said last week that Circle’s approval from the U.S. Office of the Comptroller of the Currency to establish First National Digital Currency Bank is a positive milestone, but warned investors may be overestimating how much it moves the needle on USDC growth given the competitive pressures now in place.

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JPMorgan has lowered its earnings forecasts for Circle and Coinbase after a new USDC revenue-sharing agreement with Hyperliquid changed how income from the stablecoin’s reserves will be divided.

Summary

JPMorgan cut earnings forecasts for Circle and Coinbase after the Hyperliquid USDC deal. The bank warned new revenue-sharing terms could pressure stablecoin profit margins. Analysts remain divided as higher interest rates may still support USDC earnings growth. According to a JPMorgan research note, the revised agreement could reduce the long-term profitability of the USDC business for both companies, even as they continue pursuing higher adoption of the dollar-backed stablecoin.

JPMorgan Cuts Circle and Coinbase Forecasts Over Hyperliquid Deal

JPMorgan downgraded earnings estimates for Circle and Coinbase, stating their new agreement with Hyperliquid weakens USDC economics. Coinbase will now pay 90% of USDC reserve yields on the platform to Hyperliquid,… pic.twitter.com/tnRhp5uG7M

— Wu Blockchain (@WuBlockchain) July 14, 2026 The bank argued that competition among distribution partners may force issuers to give away a larger share of reserve income to secure market share.

New revenue-sharing terms reduce reserve income Under the arrangement highlighted by JPMorgan, Coinbase will classify USDC held on Hyperliquid as “on-platform” balances. As a result, Coinbase will receive the reserve income generated by those deposits but will return 90% of that revenue to Hyperliquid instead of splitting the proceeds with Circle under the companies’ existing economic arrangement.

JPMorgan estimated that Hyperliquid currently holds about $6 billion worth of USDC, representing roughly 8% of the stablecoin’s circulating supply. Because of the platform’s growing role in the USDC ecosystem, the bank believes the revised economics could have a noticeable effect on future earnings for both Circle and Coinbase.

Describing the competitive dynamic, JPMorgan said both companies face pressure to increase USDC usage even if doing so requires surrendering a larger portion of reserve revenue to distribution partners. The bank characterized the situation as one in which efforts to expand adoption could come at the cost of lower profitability.

The revenue-sharing concerns follow an announcement made on May 14, when Circle and Coinbase revealed a partnership with Hyperliquid to deepen USDC integration across the crypto trading platform. Hyperliquid operates both a Layer-1 blockchain and a decentralized exchange offering spot and perpetual futures markets.

Since June 11, USDC has become Hyperliquid’s preferred stablecoin, strengthening the platform’s importance within Circle’s distribution network. JPMorgan said the commercial terms supporting that expansion, rather than the growth in usage itself, have become the main issue for investors evaluating future earnings.

Wall Street remains divided on Circle’s outlook Elsewhere on Wall Street, analysts have reached different conclusions about Circle’s long-term prospects. Mizuho has also taken a more cautious stance on the company, downgrading the stock as concerns grow over whether expanding USDC adoption will continue to generate attractive economics.

By contrast, Bernstein and William Blair have maintained positive ratings on Circle, indicating they still expect the stablecoin issuer to benefit from continued growth in digital dollar usage despite increasing competition for distribution partnerships.

Even after cutting its earnings estimates, JPMorgan said it continues to forecast growth in USDC-related earnings through 2027. The bank attributed that expectation to its interest-rate outlook, which now includes a 25-basis-point Federal Reserve rate increase at the October 2026 meeting.

Higher rates generally increase the income earned on the cash and Treasury reserves backing USDC, providing an offset to the revenue-sharing concessions outlined in the Hyperliquid agreement.

For investors, the latest debate has shifted attention away from USDC’s circulating supply alone and toward how reserve income is divided among issuers, exchanges, and distribution partners. JPMorgan’s analysis suggests that while adoption can continue rising, the financial value retained by Circle and Coinbase may come under increasing pressure as more platforms negotiate similar commercial terms.

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Not financial or tax advice. PANews content is strictly educational and informational and is not investment advice, financial advice, tax advice, legal advice, or a solicitation to buy or sell any digital asset, security, or financial product. Do your own research and consult qualified advisers.

Disclosure. PANews may publish sponsored content, partner content, advertisements, affiliate links, event promotions, and market commentary involving Web3 projects, service providers, or financial products. PANews personnel, contributors, or affiliates may hold digital assets or other interests related to covered topics. See our Terms of Service.

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Blockchain

14 July 2026 | 20:08 JPMorgan has lowered its earnings estimates for Circle and Coinbase, arguing that their revised USDC arrangement with Hyperliquid exposes a structural weakness in the stablecoin’s distribution model.

Key Takeaways JPMorgan said the Hyperliquid agreement creates a “prisoner’s dilemma” in which Circle and Coinbase may sacrifice margins to protect USDC distribution. Hyperliquid holds approximately $5.5 billion to $6 billion in stablecoins, with USDC accounting for nearly 94% of the on-chain supply. The frequently cited $160 million figure came from an earlier Compass Point estimate and represents potential reserve yield redirected to Hyperliquid, not a confirmed net loss. Robinhood Chain has already overtaken Hyperliquid in seven-day spot DEX volume despite launching on July 1, showing how quickly competing platforms can establish their own preferred stablecoin rails. Hyperliquid Gains the Yield Without Issuing USDC Under the revised structure, Coinbase becomes the official USDC treasury deployer on Hyperliquid. Circle remains responsible for the technical infrastructure needed to mint, redeem and move USDC across supported networks.

The arrangement preserves USDC as Hyperliquid’s primary collateral and quote asset across its spot, perpetual and other on-chain markets. It also gives the protocol access to most of the income generated by the underlying reserves.

Hyperliquid’s Aligned Quote Asset framework states that deployers share approximately 90% of cost-adjusted reserve yield generated by their supply with the protocol. Aligned assets receive trading advantages including lower taker fees, improved maker rebates and greater volume contribution toward fee tiers.

The payment is not interest distributed directly to USDC holders. It is protocol-level revenue derived from the cash and short-term government securities backing the stablecoin. Hyperliquid captures much of that income in exchange for making USDC the preferred dollar asset across its markets.

That distinction explains why the agreement can strengthen USDC’s utility while weakening its economics for Circle. The stablecoin gains volume, collateral demand and distribution, but its issuer retains a smaller portion of the reserve income attached to those balances.

Why JPMorgan Sees a Prisoner’s Dilemma JPMorgan described the arrangement as a “prisoner’s dilemma” because Circle and Coinbase both benefit from wider USDC adoption but can compete over which company gives more of the economics to major distributors.

If neither company offers favorable terms, a large platform could support another stablecoin or create its own. If one side accepts a lower margin to secure the platform, the other risks losing distribution unless it participates in the concession.

JPMorgan estimates that Hyperliquid holds around $6 billion in USDC, equal to roughly 8% of the token’s circulating supply. At the time of writing, DefiLlama showed approximately $5.5 billion in stablecoins on Hyperliquid L1, with USDC representing 93.87% of the total.

Coinbase previously treated much of the USDC held outside its platform differently from balances held directly on Coinbase. JPMorgan said that classifying Hyperliquid’s USDC as on-platform allows Coinbase to collect the associated reserve income before transferring 90% of the adjusted amount to Hyperliquid.

The structure may still benefit Coinbase strategically. Acting as treasury deployer strengthens its role in minting, redemption, liquidity management and fiat access around one of the largest pools of on-chain dollars. The trade-off is that securing that position requires Coinbase and Circle to give up most of the reserve yield generated there.

The $160 Million Estimate Needs Qualification The estimate that as much as $160 million in annual revenue could move toward Hyperliquid did not originate in JPMorgan’s July report. Compass Point produced the estimate in May, when Hyperliquid held approximately $5 billion to $5.5 billion in USDC.

The figure represented an estimate of reserve income that could be redirected under the yield-sharing arrangement. It should not be treated as a confirmed reduction of the same size in Circle and Coinbase earnings.

The eventual impact depends on several variables: The average amount of USDC held on Hyperliquid Short-term interest rates and the return on USDC reserves The costs deducted before the 90% share is calculated How the income would otherwise have been divided between Circle and Coinbase Additional revenue Coinbase earns from treasury deployment and related services The concern is still material because reserve income dominates Circle’s financial model. In its first-quarter filing with the Securities and Exchange Commission, Circle reported $652.5 million in reserve income and $405.4 million in distribution and transaction costs.

The Hyperliquid terms add to costs that already consume a substantial portion of the income generated by USDC reserves. JPMorgan consequently sees the agreement as a larger long-term issue for Circle than for Coinbase, which has a broader mix of trading, custody, subscription and infrastructure revenue.

Robinhood Shows How Quickly Distribution Can Shift Hyperliquid is not the only platform gaining leverage over stablecoin providers. Robinhood launched the public mainnet of Robinhood Chain on July 1, only 13 days before the latest DefiLlama comparison.

By July 14, Robinhood Chain had accumulated approximately $161.7 million in DeFi TVL, $327.6 million in stablecoins and $3.9 billion in seven-day spot DEX volume. Hyperliquid L1 recorded approximately $1.31 billion in spot volume over the same period.

Robinhood Chain launched and the numbers are astounding.

We dug into the metrics in this week’s edition of the DefiLlama newsletter.https://t.co/1Hs2HHmxTR pic.twitter.com/FLyJ5XNYgK

— DefiLlama.com (@DefiLlama) July 14, 2026

Robinhood therefore generated nearly three times Hyperliquid’s weekly spot DEX activity despite being less than two weeks old. The comparison is limited to spot trading. Hyperliquid remained substantially larger in its core perpetual-futures market, processing approximately $42.5 billion over seven days compared with $24.5 million on Robinhood Chain.

The quality of Robinhood’s early activity also remains unproven. Its seven-day spot volume was roughly 24 times its TVL, an unusually high turnover rate that may reflect launch activity, short-lived speculation or repeated trading through a relatively small pool of liquidity.

The stablecoin composition is more relevant to JPMorgan’s argument. USDG represented around 68% of Robinhood Chain’s stablecoin supply, while Robinhood Earn uses USDG rather than USDC for its on-chain lending product.

A new distribution platform can therefore build substantial liquidity without making USDC its default dollar asset. That increases the pressure on Circle and Coinbase to offer better economics when negotiating with exchanges, wallets, fintech applications and blockchain operators.

Longer-Term Threat JPMorgan’s argument becomes stronger if USDC distribution continues expanding while Circle’s retained income per dollar in circulation declines. The next Circle and Coinbase earnings reports should show whether distribution costs rise faster than the revenue created by additional USDC balances.

The margin-pressure thesis would gain support if USDC balances on Hyperliquid remain near or above $6 billion, making the yield-sharing concession a recurring cost rather than a temporary arrangement. Disclosures showing reserve income flowing into Hyperliquid’s Assistance Fund or being used for HYPE purchases would make the agreement’s economic effect more visible. Continued growth of USDG on Robinhood Chain, or of other regulated stablecoins on competing platforms, would further increase the value of distribution access. For Circle, the clearest financial warning would be distribution expenses rising faster than reserve income, confirming that wider USDC adoption is being achieved at the cost of lower retained margins.

The agreement does not show that USDC is losing relevance. Hyperliquid’s dependence on the stablecoin confirms its importance as trading collateral and on-chain dollar liquidity. The risk is that USDC becomes more widely used while a growing share of the value it generates is captured by the platforms controlling access to users and trading volume.

The information provided in this article is for educational purposes only and does not constitute financial, investment, or trading advice. 

Author

Alex is Editor-in-Chief of Coindoo and co-founder of Millennial Media Group, with nearly a decade of experience covering financial markets - crypto first, then everything else. It started in 2016 with Bitcoin. Like most people at the time, he didn't fully understand it - so he kept digging. Blockchain, tokenomics, the projects, the cycles. That curiosity never stopped, and eventually pulled him into traditional markets too: equities, commodities, macro. Not because he left crypto behind, but because you can't properly understand one without the other. What drives him is straightforward: he wants to know why something is happening, not just that it's happening. Most market coverage stops at the headline - price up, price down, here's a chart. Alex finds that kind of reporting actively unhelpful. If you walk away from an article without understanding the mechanism behind the move, what did you actually learn? He holds a degree in Tourism from New Bulgarian University - not the most obvious path into financial markets, but markets have a way of pulling in people who are simply too curious to stay out. He has authored over 200 in-depth analyses and more than 10,000 articles across crypto and traditional finance. He still thinks every day in markets teaches him something new. That's probably why he hasn't stopped.

Jul 14, 2026, 2:57 p.m.

2 min read

Jeremy Allaire Circle CEO. (The Washington Post / Getty Images) Summary

JPMorgan said a new arrangement with Hyperliquid is a near-term revenue headwind for Circle and Coinbase, with a greater long-term threat to Circle's USDC economics. The bank argued the deal exposes a "prisoner's dilemma," encouraging Circle and Coinbase to compete for USDC distribution at the expense of each other's economics. The Wall Street firm lowered earnings estimates for both firms, citing the Hyperliquid changes alongside weaker crypto trading volumes and asset prices.JPMorgan (JPM) lowered its forecasts for Circle Internet (CRCL) and Coinbase (COIN), saying their revamped agreement with Hyperliquid weakens the economics of Circle's USDC and posed a bigger long-term threat to the stablecoin issuer.

The bank said the deal created a "prisoner's dilemma," incentivizing stablecoin issuer Circle and crypto exchange Coinbase to compete for distribution of the dollar-pegged token at the expense of each other's economics.

Hyperliquid, now one of the largest crypto trading venues, holds about $6 billion of USDC, or roughly 8% of the circulating supply, JPMorgan estimated.

"We think the change in the Hyperliquid relationship showcases the challenge for Circle and Coinbase partnership agreements because it can create 'a prisoner’s dilemma' that drive Coinbase and Circle to compete with each other when promoting USDC distribution," analysts led by Kenneth Worthington said in the Tuesday report.

Hyperliquid is one of crypto's fastest-growing trading venues and the leading decentralized perpetual futures exchange. The platform processed more than $150 billion in trading volume in July alone, while its volume relative to Binance climbed to 11.5%, underscoring its growing share of the derivatives market. USDC balances on Hyperliquid have swelled to roughly $6 billion, making it an increasingly important distribution channel for the stablecoin.

Under the new arrangement, Coinbase will classify USDC on Hyperliquid as "on-platform," collecting the income generated by reserves and paying 90% of it to Hyperliquid. JPMorgan estimated Coinbase previously split nearly all of the revenue evenly with Circle.

The bank cut earnings estimates for both companies, citing the Hyperliquid agreement and weaker crypto markets, though it expects higher interest rates to provide some support for USDC-related revenue over the longer term.

USDC has also lost momentum in recent months. Its circulating supply has fallen to about $73 billion from nearly $80 billion in March, part of a broader $10 billion contraction in the stablecoin market since May as crypto trading activity cooled and new regulated rivals chipped away at the dominance of USDC and Tether's USDT.

Japanese investment bank Mizuho said in a report last week that Circle's final approval from the U.S. Office of the Comptroller of the Currency to establish First National Digital Currency Bank is a positive milestone, but investors may be overestimating its significance.

AI Disclaimer: Parts of this article were generated with the assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to our standards. For more information, see CoinDesk's full AI Policy.

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Not financial or tax advice. PANews content is strictly educational and informational and is not investment advice, financial advice, tax advice, legal advice, or a solicitation to buy or sell any digital asset, security, or financial product. Do your own research and consult qualified advisers.

Disclosure. PANews may publish sponsored content, partner content, advertisements, affiliate links, event promotions, and market commentary involving Web3 projects, service providers, or financial products. PANews personnel, contributors, or affiliates may hold digital assets or other interests related to covered topics. See our Terms of Service.

This site is protected by reCAPTCHA.