Hyperliquid is a decentralized exchange built on its own Layer-1 blockchain called HyperEVM. Unlike traditional Automated Market Makers (AMMs) or off-chain matching engines, Hyperliquid utilizes a fully on-chain order book model. This shift allows for greater performance and scalability, processing up to 200,000 orders per second with a latency around 0.2 seconds. The architecture features two main components: HyperCore, which handles core trading functions, and HyperEVM, designed for EVM compatibility. This unification allows applications to directly access HyperCore's liquidity, eliminating the risks of cross-chain inconsistencies. Fee structures differ for perpetual contracts (perps) and spot trading, with spot volume counting double toward fee tiers. The platform includes Hyperliquid vaults, where users can collaborate on trading strategies. These vaults, like the Hyperliquidity Provider (HLP), allow users to deposit USDC and share in profits or losses. Vault leaders can manage their own user vaults, earning a cut of the profits based on their stake. Token holders influence platform governance through Hyperliquid Improvement Proposals (HIPs), with HIP-3 enabling anyone staking 1 million HYPE tokens to create new perpetual futures markets. The introduction of Builder Codes allows developers to connect their applications to Hyperliquid’s backend, earning a share of trading fees. This feature has gained traction since its launch in October 2024. Hyperliquid prides itself on having the deepest liquidity in the market, which is critical for attracting users in a crowded decentralized finance space. Variational, the team behind Hyperliquid, raised $11.8 million in funding, backed by notable investors such as Bain Capital Crypto and Coinbase Ventures.