Article sourced from: Deep Tide TechFlow
Author: kaledora
Compiled by: Deep Tide TechFlow
Multiple viewpoints can coexist:
Hyperliquid's airdrop marks a turning point, embodying a complete rejection of the trend towards 'air software' dominated by insider-supported infrastructure, which typically allocates only a tiny share to the community.
Raising huge amounts at ridiculous valuations, only to launch at an absurd fully diluted valuation (FDV), ultimately leading to a continuous decline in stock price and a sell-off to retail investors, is bad behavior.
For most projects, it's hard to avoid fundraising and having 'insiders' unless the founder has already made tens of millions of dollars.
Here are some thoughts on how to understand these seemingly contradictory viewpoints.
The success of Hyperliquid
Hyperliquid's airdrop was a significant event in this cycle. I particularly appreciate the following four points:
It resets expectations about how, when, and to what extent Token ownership should be allocated.
It reestablishes the importance of DeFi and user-centric applications in the industry.
It proves that selling pressure should be quickly resolved, not procrastinated.
The cultural aesthetics of the community
The cleverness of Hyperliquid lies in combining the token timeline of venture-backed projects with the allocation mechanism of ICOs. Build the product first, launch without tokens, iterate with users multiple times, adapt gradually to enhance the most valuable behaviors for the protocol through multiple seasons of points, and then release the tokens more than a year later (instead of raising funds before the product launch). But like community-funded projects, distribute tokens to users.
Ironically, in many areas where founders are eager to reduce selling pressure by limiting allocations and liquidity at the time of the initial issuance (TGE), Hyperliquid has successfully achieved possibly the strongest buying pressure post-launch, with the broadest distribution among major protocols over the years.
Regarding selling pressure: the more protocols attempt to artificially disperse the selling pain of short-term speculators, the more selling pressure is exacerbated, making it nearly impossible for true long-term supporters to hold tokens (as the complex supply dynamics in the medium term will outweigh the strength of the project).
My last point of appreciation for Hyperliquid is its community's cultural aesthetics, although few mention it. 'Community' refers to those who actually use the product. The love for community in cryptocurrency has evolved into an implicit demand that every product needs to have its own quasi-religious cult, whether real or bot-generated, filled with exaggerated visual logos, slogans, and Discord profiles that may be real or bot-generated, conveying some version of the same few slogans daily. Building a cult around images or slogans unrelated to the core product is a substitute for the cult that should be around your product itself.
The cult of Hyperliquid exists, but it is - or at least started as - a cult of users, not followers. As far as I know, its most obsessed users don't even have their own consensus self-reference name. I heard 'bozos' is the de facto term, but overall, there are few distinctive features of HL's crypto branding. I'm not sure I've seen any HL pepe; there are PURR cats and PIP, but that's basically it. Aesthetically, it takes its clean brand seriously, with posts not filled with cartoon characters.
However, the cult of Hyperliquid is explosively growing, and its social media is being thoroughly robotized. Its followers seem to have tripled in the past few weeks, but when they start processing billions of dollars in trading volume daily, there are only about 30,000 of them. Compared to other projects with hundreds of thousands or even millions of followers on Twitter (where you don't know a single user!).
Even if you can't (or don't want to) replicate them, you can still learn something from Hyperliquid.
Ignoring the product, most founders building serious projects cannot simply avoid fundraising, the obvious reason being that they do not have 5 to 10 million dollars to fund a small development team for several years. Those who have this privilege should consider investing and reaping the excess rewards that may come if executed well. If you are a college graduate entrepreneur or in any way an ordinary person, this may not be your option.
Even if Hyperliquid has set unrealistic expectations in some ways for those unable to raise external capital without fundraising, I think this reset is actually a good thing if you are not raising huge amounts.
Readers just need to look at the type of announcements that provide the greatest status boosts and consistently trigger the most bot-driven growth: fundraising announcements. Over the past few years, fundraising announcements have become a definitive status symbol in cryptocurrency; the bigger, the better. This puts natural pressure on founders to raise larger amounts at increasingly higher valuations, regardless of how much capital they actually need to reach the next stage. This isn't unique to cryptocurrency, but if you believe in its fundamental spirit in any way, this certainly doesn't benefit cryptocurrency.
Even if you can't avoid fundraising, you can raise more reasonable funds, focus on the product, and avoid getting involved in the game of who can raise the largest funding round. Instead, compete on who can build the best product - that would be more interesting and hopefully better for the entire cryptocurrency.
Summary:
HL puts DeFi in the lead and redefines the model of token distribution.
Selling pressure should be resolved quickly.
Reject groups that do not focus on the product.
The market has allowed you to focus more on product development rather than fundraising.