What is Hyperliquid's HIP-3? How it works and use cases

What is HIP-3?

Overview and Mechanism

HIP-3, or Hyperliquid Improvement Proposal 3, is one of the most significant developments for Hyperliquid. Also known as “Builder-Deployed Perpetuals”, this update enables a decentralized process for launching new perp markets on Hyperliquid.

Previously, the creation of new markets was mainly managed by validators, who selected assets and set technical parameters through governance. With HIP-3, builders can deploy their own perp DEX on HyperCore - the core infrastructure of Hyperliquid - while choosing the market structure, parameters, and front-end experience.

The process is based on a 500,000 HYPE stake requirement. This stake acts as a guarantee aligning the interests of builders and Hyperliquid, helping preserve market quality and user safety.

For each HIP-3 perp DEX, the first three assets can be deployed without participating in an auction. Additional assets then go through a Dutch auction process shared across HIP-3 perp DEXs, with auctions following the same broad mechanism as Hyperliquid’s HIP-1 listings.

The market operator chooses key parameters: the oracle, margin and collateral asset, funding and liquidation parameters, the share of trading fees received, as well as market governance and management.

You can track live deployed markets, DEXs, open interest, volume, categories, and 7-day charts on our Hyperliquid HIP-3 markets dashboard.

Strategic Value for Hyperliquid

Hyperliquid’s value proposition rests on several elements: an optimized technical infrastructure, liquidity depth rivaling leading centralized platforms, and a high-performance on-chain order book. The introduction of HIP-3 reinforces Hyperliquid’s positioning as infrastructure for on-chain finance and is a core component of the “AWS of liquidity” thesis.

The HIP-3 model encourages a network effect: each new market attracts new traders, deepens liquidity, drives demand for HYPE through staking and deployment requirements, and ultimately increases activity and protocol revenues.

This approach is radically different from centralized exchanges, where asset listings rely on opaque and often extractive criteria for projects. HIP-3 enables builders to access Hyperliquid’s technology and deploy a wide range of new markets: equities, US indices, commodities, FX, structured products, prediction markets, and more.

Kinetiq Launch

About Kinetiq

Kinetiq is the native liquid staking protocol for the Hyperliquid ecosystem. It allows users to transform staked HYPE into kHYPE, a liquid staking token that generates yield and can be used within DeFi applications on HyperEVM.

Thanks to CoreWriter integration, Kinetiq is fully non-custodial: HYPE deposited by users is immediately staked on HyperCore and distributed across multiple validators. Allocation between validators is actively managed using a scoring algorithm called StakeHub.

Launched on July 5, 2025, Kinetiq quickly became one of the leading protocols on HyperEVM in terms of TVL. You can find our full presentation on Kinetiq here:

Using HIP-3

On July 31, Kinetiq announced Launch, presented as the first “exchange-as-a-service” (EaaS). Simply put, this is infrastructure designed to help teams deploy new perp markets on Hyperliquid via HIP-3.

Leveraging Kinetiq’s liquid staking architecture, Launch enables teams to create crowdfunding pools to raise the 500,000 HYPE required to launch builder-deployed markets. In practice, Launch offers several services:

• A technical infrastructure to easily deploy and manage markets via HIP-3.
• A crowdfunding mechanism to reach the HYPE staking requirement.
• Risk management and fund protection systems for kHYPE holders.
• An automated revenue sharing system to distribute a portion of market fees to kHYPE holders who participate in crowdfunding.

In summary, Launch enables teams looking to deploy new perp markets to access the necessary HYPE stake more efficiently, allowing them to focus on market management and value creation for users.

This also creates a new opportunity for HYPE holders. In addition to participating in Hyperliquid staking, it is now possible to deposit kHYPE into specific pools to support the deployment of a market and receive a share of associated revenues.

Liminal

About Liminal

Liminal is a yield farming protocol built on Hyperliquid and accessible on HyperEVM. It provides access to automated delta-neutral strategies on stablecoins, mainly USDC, with limited market direction exposure.

In practice, Liminal uses users’ USDC on Hyperliquid to buy an asset on the spot market and open an equivalent short position on the perps market for the same asset. The yield is generated primarily by funding fees paid by Hyperliquid traders.

In the background, Liminal automatically manages deposits, position opening and closing, and risk management. The protocol is built on Hyperliquid’s infrastructure and leverages its liquidity depth for minimal slippage and fast execution.

The protocol charges a simple fee structure, including a performance fee and builder fee depending on the strategy format.

To join Liminal, feel free to use our referral link (code LILOAK). Thank you for your support.

Using HIP-3

The arrival of HIP-3 is a significant milestone for Liminal, extending far beyond delta-neutral strategy automation. Since available strategies are directly linked to markets deployed on Hyperliquid, HIP-3 expands the potential asset universe that Liminal can build around.

First, HIP-3 enables the development of markets beyond crypto-native assets, including tokenized equities, commodities, FX, indices, and other real-world assets. With tokenized assets available on the spot side and corresponding perp markets deployed through HIP-3, Liminal could offer fully on-chain delta-neutral strategies for new asset classes.

HIP-3 also opens the door to markets supporting new collateral types such as USDe, BTC, or ETH, beyond just USDC. This creates new opportunities for Liminal:

• USDe-margined markets could provide dual yield: from funding and from the native stablecoin yield.
• New strategies become possible, e.g., holding BTC spot while shorting a BTC-margined BTC-PERP market. Since both assets are the same, this reduces depeg and cross-asset volatility risk.

In short, HIP-3 enables Hyperliquid to create new perp markets, tokenized asset issuers can provide spot exposure, and Liminal becomes a yield engine to access delta-neutral strategies across a broader range of assets.

Ventuals’ Pre-IPO Markets

Ventuals is a protocol that offers a perp market structure for trading pre-IPO companies, built on Hyperliquid via HIP-3. It targets a previously inaccessible market: speculating on private company valuations before IPO, historically reserved for specialized players.

Ventuals creates perp markets where the underlying is not a stock price, but the total valuation of a private company, such as OpenAI, Stripe, or SpaceX. Users can take long or short positions with leverage on the valuation evolution of their chosen company.

The oracle mechanism is based on public secondary transaction data and widely recognized private market estimates. The unit of account (“Valuation Unit”) is the company’s total valuation in billions of dollars: for example, a price of 350.24 on vOAI represents a $350.24B valuation for OpenAI.

Initial liquidity is provided by a market making vault managed by the Ventuals team, but the protocol aims to progressively open the role of liquidity provider to the community. In case of a major event, such as a fundraise, IPO, or acquisition, the affected market can be suspended and positions settled according to the latest public valuation.

The creation of these pre-IPO markets is enabled by HIP-3, allowing Ventuals to benefit from Hyperliquid’s matching engine, order book depth, liquidity, and execution speed, while retaining control over key parameters. Above all, Ventuals brings on-chain access to products that were previously out of reach for DeFi.

Conclusion

By making the deployment of new perpetual markets more open with HIP-3, Hyperliquid does more than simply expand its product range: it becomes true infrastructure for on-chain finance, capable of hosting markets for asset classes that were previously inaccessible.

For users, this also means a proliferation of use cases. Whether it’s Kinetiq’s Launch, Liminal’s yield architecture, or Ventuals’ pre-IPO markets, the ecosystem offers entirely new opportunities for yield and investment.

This new model does, however, raise fundamental challenges: the quality and robustness of oracles, smart contract security, liquidity fragmentation, and the need for robust governance and monitoring to maintain confidence across a diverse range of markets.

If liquidity and demand continue to follow, HIP-3 could realize the “AWS of liquidity” thesis and establish Hyperliquid as the leading on-chain derivatives infrastructure for the next generation of decentralized finance.