Article sourced from: Yuliya
Interview: When Shift Happens
Compiled by: Yuliya, PANews
(When Shift Happens) Previous interviews invited Hyperliquid Labs founder Jeff. Hyperliquid is a decentralized perpetual contract trading platform and also a Layer 1 project. In an hour-long conversation, Jeff shared his entrepreneurial journey, project vision, and observations on the DeFi industry. PANews compiled the interview content, covering aspects such as technical innovations, operational models, and user experience improvements, while also discussing the development trends and challenges of the cryptocurrency industry.
Entrepreneurial Journey
Host: Jeff, can you share how you got on the path of entrepreneurship?
Jeff: This started in early 2020. At that time, I began researching some simple trading scripts, mainly focusing on centralized cryptocurrency exchanges (CEX). Although many large market makers had already entered the scene, sometimes 'ignorance is bliss' can be a good thing. I thought I’d give it a try to see if I could make some money.
The initial research results were promising, so I decided to take this seriously. To be honest, I wasn't very good at coding before, but to achieve my goals, I started to self-learn programming. By 2022, we had developed into one of the largest traders on many exchanges, possibly one of the best in high-frequency market making.
Host: What prompted you to shift from successful quantitative trading to creating Hyperliquid?
Jeff: There are two main reasons:
First, we began focusing on the DeFi space and discovered many interesting protocol designs. There's an interesting phenomenon in DeFi: many people who do not understand finance are trying to build financial systems, which has instead opened many opportunities for quantitative strategies.
Secondly, the collapse of FTX was an important turning point. This incident made people realize that blind trust in centralized exchanges is not an option. This is not an abstract theoretical discussion, but a real loss of funds. For us, this was an important revelation—that the world is finally ready to accept true DeFi.
Product Philosophy
Host: Can you explain in simple terms what Hyperliquid actually does?
Jeff: From the perspective of human history, society has always been moving towards individualism. Every advancement towards individualism, human rights, and so on has been positive in outcome, whether measured by GDP or happiness.
Hyperliquid is continuing to push in this direction: from initially needing to protect one's farm with weapons, to later being able to keep money in the bank, to now with Hyperliquid—you can fully control your funds through crypto technology.
Specifically, we are building a system that can:
Meet all user expectations for Web2 finance
Provide low fees
Support fast transfers
Achieve instant settlement
Provide liquidity comparable to centralized exchanges
Allow trustless integration with other applications
Support collateralized lending
Enable users to truly use their funds freely
Funding Strategy
Host: Why choose not to accept any investments? This is rare in the industry.
Jeff: This is indeed not a traditional business project in the usual sense. This might be the first time in DeFi or even the entire cryptocurrency field that this is done, but if we look at Amazon's example, Bezos also did not profit from it for a long time in the early days.
There are several deep reasons why we do this:
The cryptocurrency industry places too much emphasis on short-term gains
If a new financial system is to be created, allowing VCs to hold 50% of the network's share in the early stages would be a permanent stain.
Our team is capable of not relying on external funding, which allows us to stick to this decision.
Industry Perspective
Host: Do you have any criticisms of the current cryptocurrency industry?
Jeff: To be honest, the most 'successful' products in the industry often involve issuing fraudulent tokens. Very few projects genuinely follow a user-centric model because acquiring real users is indeed very difficult. Most projects take shortcuts: first securing investments from large market makers, then attracting trading through incentive programs. This model is unsustainable in the long run.
Host: What is your view on the current state of the cryptocurrency industry?
Jeff: Although many people view cryptocurrency as a failed experiment, I believe it is humanity's only hope to reinvent the financial system. Finance is one of humanity's greatest inventions, allowing us to:
Represent value in a more abstract way
Achieve better capital allocation
Establish a complete economic system
Without these, all other advancements might not be achievable. Human society might still be stuck in an agricultural or even hunting-gathering phase.
Software should be able to fundamentally change finance, but the reality is that finance (and possibly healthcare) is one of the few large industries that has not experienced substantial innovation.
Technological innovation
Host: Can you elaborate on the concept of Builder Codes?
Jeff: This is a simple but powerful concept. It allows anyone to build financial applications on top of Hyperliquid, such as:
Innovative mobile wallet
Social trading platform
Regional exchanges
Fiat deposit channels
Developers can:
Building your own exchange business
Using our neutral backend
Charging fees in a user-trusted manner
Generating revenue directly at the protocol level, rather than relying on private agreements with centralized exchanges
This will open up a new way of building businesses in DeFi, making specialization possible. Those who understand the specific regional user needs can focus on serving those users, while Hyperliquid provides support in the background.
Future Outlook
Host: How do you view the long-term development of the project?
Jeff: I like to use Go and chess as metaphors. You don't need to be completely certain of where you want to end up, but you must ensure that every step is in the right direction. What's important is to do each step well, rather than being overly fixated on a distant endpoint. That's why we focus more on building infrastructure instead of short-term market performance.
Host: What is Hyperliquid's long-term vision?
Jeff: Our core philosophy is:
Cryptocurrency will change the way finance operates
Traditional finance will eventually migrate to cryptocurrency
Hyperliquid will become the foundational platform for these financial activities
The specific implementation path is hard to predict, but that's not the most important thing. We focus on building infrastructure that will play a crucial role no matter how the future develops:
Builder Codes System
EVM integrated with on-chain native components
Sustainable high-quality liquidity
These are essential infrastructures that are difficult to execute well, and I believe they will be indispensable cornerstones regardless of how cryptocurrency evolves in 10 years.