Author: The New World of Ray

Recently, Hyperliquid's publicly available listing mechanism has sparked heated discussions. The reason this event garnered market attention stems from a tweet by Moonrock Capital CEO Simon on November 1. He claimed that 'Binance required a potential project to provide 15% of its total token supply to ensure its listing on CEX, which accounted for about $50 million to $100 million in token value.'

At the same time, Sonic Labs co-founder Andre Cronje also stated, 'Binance does not charge listing fees, but Coinbase has repeatedly requested fees, quoting $300 million, $50 million, $30 million, with the latest quote being $60 million.'

Why is there always a dispute over listing fees?

In the crypto world, which is primarily driven by decentralization, centralized CEXs have become the main participants. However, the opaque operations of CEX token listings make it difficult for the market to accept. Rumors about CEX listings circulate from time to time. Binance's founder He Yi once stated after the listings of PNUT and ACT that 'no listing fees were charged'; even Binance, as strong as it is, needs to navigate the public discourse around 'listing fees'.

He Yi's response to the listing fee controversy

Nonetheless, it remains challenging to convince the market of CEXs' claims of having no listing fees. Even without 'open and honest' charges, discussions about hidden token fees continue to emerge. Some leading CEXs explicitly state in their announcements that they do not charge listing fees, but after listing, project parties still need to pay a corresponding deposit to ensure price stability. Additionally, agreements regarding CEX's shareholding and operational costs must be reached when listing. These indefensible hidden listing fees have contributed to the market's perception of CEX listings as 'black box' operations.

On one hand, such a cumbersome and opaque listing mechanism is an additional burden for project parties. They need to spend extra costs to deal with CEX listing affairs, leading to adverse selection problems. Project parties focus less on long-term development and instead develop an expectation of 'happy listing,' ultimately leading to most listed projects exiting with their tokens.

On the other hand, the unfair listing practices of CEXs have even evolved into a niche market. Researching listings has become a serious 'business,' and the study of listing strategies has become a necessary course for many investors and KOLs. For example, a recent news report by Equation leveraged listing news to earn $3 million after the ACT token listing.

Equation News leveraged the listing announcement for early trading.

It can be said that the crypto industry has long suffered from centralization. The wealth effect of each listing has often been taken away by CEXs (listing fees) and scientists (who trade early after listings). Projects sacrifice quality due to the need to bear the significant listing fees, and ultimately, it is retail investors who pay the price. The logic of listing events is akin to the current retail investors embracing memecoins while rejecting VC coins, with fairness remaining at the core.

What is the market optimistic about with HYPE hitting new highs?

However, Hyperliquid's emergence has broken the deadlock of 'opaque token listings.'

Hyperliquid's rise in the crypto sphere can be traced back to the growth path of HYPE. After TGE, HYPE quickly broke into the top 50 by market cap in just two weeks, surpassing both new and established projects like Fantom and Bittensor, even outpacing Arbitrum itself. Although the narrative of Perp DEX is no longer novel, Hyperliquid successfully refocused market attention on DEX.

The indispensable listing mechanism

Today, HYPE has surpassed $20, setting a new historical high. Behind this new high is largely due to Hyperlqiuid's precise 'market aesthetics,' which has keenly captured this cycle's market pulse of 'VC turning into memes.' Hyperliquid, which appears to have a 'VC-like' project temperament, did not follow the old path of first securing VC funding, inflating metrics, and then listing. Its founder Jeff has repeatedly publicly expressed dissatisfaction with this form and market logic.

Moreover, Hyperliquid's team operations and project development have both been impressive. Hyperliquid's ambitions extend beyond just PerpDEX; it is also actively building a 'trading' public chain characterized by low latency, high throughput, high-frequency trading, and order books. When the underlying logic shifts from PerpDEX to a public chain, it unlocks a new valuation ceiling.

In addition to the reasons mentioned above, the public and transparent listing mechanism of Hyperliquid is also an essential factor in its success. So how exactly does Hyperliquid list tokens?

Dutch auction

Hyperliquid employs Dutch auctions to auction token tickers, and its listing process is relatively open and transparent, with detailed introductions in official documents.

Firstly, if a project wants to list spot trading, it needs to apply for deployment rights for the HIP-1 native token (HIP-1 is the token standard set by Hyperliquid). It will then use a Dutch auction mechanism to determine who will ultimately acquire the token ticker. Dutch auctions, also known as descending price auctions, start at a price higher than the market expectation and continuously lower until the first acceptance of that price is made. From a game theory perspective, the Dutch auction reflects the true psychological expectations of bidders and can achieve a fair price.

Hyperliquid Spot Trading Process

When deploying tokens on Hyperliquid, project parties need to pay a gas fee, but this gas auction fee will be returned to the HLP Vault in the future.

Additionally, Hyperliquid's auctions typically take place every 31 hours, with a maximum of 282 spots available for listing throughout the year. This passive 'quota' approach also indirectly improves the quality of listed projects.

In summary, compared to the opaque operations of CEXs that leave the public confused, Hyperliquid's listing mechanism is transparent, and the gas auction price collected will be returned to the community in the form of staking, creating a positive feedback loop.

Derivatives of the auction mechanism

Using this public auction mechanism, more interesting routes will emerge in the future. For instance, this auction mechanism may also lead to 'ticker' disputes. Earlier this year, when zkSync was listing on various major exchanges, the Polyhedra Network, which initially used the ZK token ticker, ceded the prestigious ZK ticker to zkSync, subsequently changing Polyhedra's token to ZKJ.

It is foreseeable that in the future, more projects launching on Hyperliquid will exhibit the same 'fighting' behavior. Project parties will vie for token tickers that better align with their interests, and stories akin to 'Sina investing 8 million yuan to purchase weibo.com' or 'Finance being acquired by Moniker for $3.6 million in 2007' will soon play out on Hyperlqiuid.

The 'big fool' who spent $180,000

After completing a 'monumental' airdrop at TGE, the auction price of Hyperliquid has continually broken new records. As early as June of this year, its auction ceiling hovered around $35,000, failing to break the previous hard ceiling of $35,000. However, after TGE, Hyperliquid received unprecedented market attention, directly 'pushing' it to $128,000, breaking through previous constraints. On December 11, it achieved a historic high of $180,000 in the FARM auction.

The record-breaking $128,000 ticker battle originated from 'SOLV', and it is noted that the Solv Protocol will have its TGE soon, so it is highly likely that this ticker was won by Solv Protocol. Previously, the token tickers auctioned by Hyperliquid were mainly meme-based, such as PIP, CATBALL, etc.

After this airdrop, Hyperlqiuid's popularity began to soar. The record-breaking auction of SOLV marks a turning point for Hyperliquid as it transitions from a meme playground to a legitimate force, and the Solv Protocol will be the first top-tier project to launch on Hyperliquid.

At the same time, Solv's login has brought a significant 'catalyst effect' to Hyperlqiud, not only setting a precedent for Hyperliquid's subsequent ticker auctions but also driving the trading structure towards a healthier direction.

Hyperliquid Auction History

On one hand, after Solv led a significant breakthrough in the ticker auction market, the tickers subsequently auctioned by Hyperliquid also 'improved.' The market viewed SOLV's auction as a reference for post-TGE pricing, with tickers like BUZZ and SHEEP reaching quotes above $100,000, and the lowest being HYFI at a transaction of $90,000. Subsequently, the FARM ticker on December 11 set a new record at $180,000.

The final owner of the FARM token ticker is @thefarmdotfun. The Farm is creating the world's first GenAI artificial intelligence agency game, where users can generate different types of pet-like AI agents through the GenAI model. When these AI pets are minted or traded, the FARM token will be used for fees. Under the premise of a fixed total supply, 50% of FARM will also be burned as part of the fees. The $180,000 spent on FARM was not in vain, as it quickly reached a market cap of $30 million just hours after the launch, approaching $50 million. This also opens up the imagination space for the Hyperliquid ecosystem.

FARM's market cap approached $50 million at its opening on December 13.

On the other hand, according to AXSN data, the daily trading volume of the token HYPE has monopolized the daily trading volume on Hyperliquid, reaching $360 million, far ahead of tokens like PURR, PIP, and JEFF. With the login of SOLV, Hyperliquid's trading structure will further optimize. As the market attention and public discourse surrounding the Solv Protocol login evolve, more projects will choose to launch on Hyperliquid, and trading volume will become more decentralized in the future.

Hyperliquid Trading Structure Distribution

What has Hyperliquid changed?

As Hyperlqiuid founder Jeff said, 'ownership goes to the believers and doers, not rent-seeking insiders.' The development of Hyperliquid aligns with this principle.

The mutual pursuit of project parties

For VC coins, listing on Hyperliquid is also a complementary and mutually beneficial market behavior. The auction itself serves as a form of advertisement. Without paying additional advertising fees, Solv became the center of market discussion by winning the Hyperliquid auction ticker.

For many altcoin project parties, even if some projects are listed on major exchanges, it is still challenging to maintain a stable price. If they cannot list on top-tier CEXs during a bull market, they are likely to struggle to maintain an appealing 'K-line.' Without liquidity, there is no traffic, and no subsequent stories; most obscure tokens after listing become 'high-heeled shoes' or 'Christmas trees.'

Many tokens, even if they are listed on major exchanges, find it difficult to maintain stability.

Hyperlqiuid offers a more economical solution that caters to the urgent demand for a major launch while being able to 'grab a seat' on a decent trading platform at a low cost. After integrating with HyperEVM, tokens purchased from Hyperliquid can be used in other EVMs, further highlighting its cost-effectiveness for token listings. Although Hyperliquid does not yet have the strong listing effects typical of CEXs, the widespread market attention on this SOLV auction event further emphasizes its position in the eyes of crypto enthusiasts.

Hyperliquid's epic airdrop resembles a grand market education campaign, allowing more people to recognize Perp DEX, understand, engage with, and use it; the transparent listing plan serves as the first shot in the fight against opaque operations, aiming for resistance, struggle, and victory.

From the industry's perspective, the emergence of Hyperliquid is both a historical process and a choice of the times. In response to public demand, the market has repeatedly 'voted with its feet' for fairness. Hyperliquid's open listing mechanism is a revolution against the opaque operations of existing CEX token listings, forcing the entire industry to become more open and transparent.

What entrepreneurial spirit does Crypto need?

Often, a company's founder determines the core spirit of that company. This statement is vividly illustrated in Hyperliquid.

Founder Jeff no longer trusts CEXs after the bankruptcy of FTX and refuses any VC investments. In Jeff's view, most projects first gain support from top institutions and then use various so-called points programs to embellish data, ultimately exiting by listing on major exchanges. This industry model seems to have become the ultimate template for many projects to achieve rapid success: write stories, pull investments, and list on major exchanges. Ultimately, retail investors bear all the consequences, leading to a chaotic outcome; this short-sighted industry phenomenon is ultimately unsustainable.

Ultimately, Hyperliquid witnessed the victory of Jeff's decentralized spirit. The transparent and open mechanism, along with a strong and cohesive community, has propelled PerpDEX to a climax of 2.0, and Jeff can proudly say: We did not allocate tokens to any private investors, centralized exchanges, or market makers. The bullets fired years ago are hitting the target now.

The history of Crypto's development is also a history of the struggle for decentralization, from the birth of Bitcoin to the recent disputes over Neiro's capitalization. Regardless of how Crypto evolves, victory and justice will always stand on the side of the public, fairness, and decentralization.