2025 Crypto Wallet Dark Battle: Is Competing to Connect to Hyperliquid a Good Business?

The previous wallet track was a covert battle at the underlying infrastructure level of Tee, and many viewers’ grandpas in the backend are urging for updates. So, the Fourteen Jun will make another splash in 2025.

Hyperliquid is undoubtedly the hottest topic of the year. This time, let’s take an insider’s look at the details, connect the events, and see how wallets, exchanges, DEXs, and AI trading are all vying for dominance here!

1. Background

In 2025, I have basically studied all the Perps (perpetual trading platforms) on the market, witnessing the hype market grow fivefold and the halving at its peak (9->50±>25). Amidst the ups and downs, is it really that competitors have fallen behind? Or is it because the development of hip3 and builder fee mechanisms has reduced platform revenue concerns?

The Perps track itself also has many competitors emerging, recently including Aster, Lighter, and even Sun哥 has entered the scene. SunPerps, which is shaking up the track, even set a new online attendance record for Web3 industry releases via its promotional Twitter Space.

From the chart below, we can see the so-called chaos of multiple heroes fighting for dominance. Interestingly, this is also a rare process of a pre-existing market being divided.

Recalling the competition among all DEXs during the DeFi Summer, including Uniswap, Balancer, Curve, and many Uniswap forks like PancakeSwap, etc.

The current state of Perps is very much like that moment during DeFi Summer. Some want to build platforms, some want to aggregate others, some aim to become the top leader, and some just want to take a slice of the tail oil.

Over the past year, various wallets have competed to launch perpetual trading capabilities at DEX entrances. MetaMask and Phantom took the lead, and last week Bitget also announced integration news. Other entrepreneurial products like Axiom, BasedApp, xyz (hip3), and multiple AI trading platforms are also trying to carve out a share through integrations.

Thus, a new round of covert battles in the wallet track is underway.

Everyone is rushing to integrate Hyperliquid’s perpetual trading capabilities. Is this due to the technological open bonus, the temptation of rebate mechanisms, or just a true reflection of market demand? Why do some top platforms remain inactive? Have early adopters already seized the market through this?

2. Ecosystem Origins, Builder Fee, and Referral Mechanisms

Hyperliquid’s rebate mechanism mainly includes Builder Fee combined with Referral (rebates).

I have always believed this is a very disruptive mechanism. It allows DeFi builders (developers, quant teams, aggregators) to charge additional fees when placing orders on behalf of users, earning service income. Meanwhile, users placing orders on these platforms or official sites pay the same total fee as before.

Essentially, this is similar to the hook mechanism in UniswapV4, where the platform’s order book (or liquidity pool) serves as infrastructure, providing access to upstream platforms. This makes it easier to attract different user groups from various platforms, and different flow platforms (wallets) also develop more comprehensive ecosystem products to serve their users’ diverse needs.

Since its initial launch, this mechanism has already brought some projects over ten million USD in dividend income, with significant early effects, but subsequent growth has been declining.

From the chart, we can see many points worth pondering:

• Why does MetaMask’s user base generate five times the revenue of Phantom’s access?

• Why is the revenue difference between BasedApp and Axiom so large? Where is Jupiter?

• Is 12 million USD in dividends considered high or low? Short-term or long-term?

• Do platforms that only lightly integrate HypeEVM or native tokens suffer losses?

• Why are Bn, OKX, and others not involved?

3. Open Strategies of PerpDex

To answer these questions, we first need to understand how various platforms are integrated.

3.1 Open API Integration Method

Actually, all Perps platforms have open APIs, very comprehensive. Nearly every platform has its own definition, but the modules generally include: query functions (account status, positions, orders, market data, K-line, etc.), trading functions (place order, cancel, modify, leverage adjustment, withdrawal, etc.), subscription functions (WS real-time price push, order book, position changes).

Because this system itself requires these APIs to provide market-making services, and users only change trading directions, not the underlying infrastructure, the user interface cannot contact the platform directly like market makers do. Therefore, some control mechanisms are necessary.

Hence, rate limiting mechanisms are implemented. Hype’s approach is based on address + IP dual-layer rate limiting, with dynamic adjustment based on trading volume. During high concurrency, there may be challenges with rate limiting.

The advantage of official API solutions is rapid integration, no need to build nodes, low data latency, and good state consistency.

But the disadvantages are also obvious: potential IP/geographical restrictions, susceptibility to rate limiting, which is less problematic for individual users but difficult for platforms, as user numbers can increase at any time, making dynamic scaling hard.

There are also update issues—app code updates require releases. If the official API changes or limits, the app has no control beyond becoming a traffic provider, and must also handle customer complaints and risks.

3.2 Read-Only Node Integration Method

Hyperliquid has a dual-chain structure, with EVM and Core chains integrated into one closed-source package, making it very difficult to crack or read specific content externally. The project only supports deploying read-only nodes (which can access order, K-line, and trade data but cannot send transactions).

It does not provide all historical data—data volume is huge: about 1TB+ is added in just two days. Over a year, unarchived historical data becomes costly and difficult to cover with revenue.

If a project deploys read-only nodes to reduce the frequency of official API reads and thus minimize rate limiting, this is currently recommended by the official.

However, adopting this approach involves many technical challenges: occasional block drops, massive storage requirements, missing historical data, and the need to modify node data methods.

I believe the biggest issue is the inconsistency problem caused by this half-open mechanism.

For example, if I use only read-only node K-line data to place an order, but the node is delayed (which can happen probabilistically), and I must place orders via the official API without delay, the data may be inconsistent. This could cause a market order to be executed at an undesired price.

Who bears the responsibility? Does the platform profit enough to cover compensation? What costs are involved in improving stability? Is passing the buck appropriate?

3.3 Market Choice

This reveals differing approaches.

• MetaMask, as a typical tool-oriented wallet, directly adopts front-end open API access, even open-sourcing the integration code. This simple and straightforward method enables rapid deployment. I rarely see such conservative top wallet platforms acting so quickly in the market.

• Similar approaches are used by Rabby, Axiom, and BasedApp.

• Trust Wallet also integrates Perps, but connects to BN’s Aster platform, which is clearly a self-developed product. Internal fee sharing is uncertain.

• Phantom originated from the Meme wave on Solana. It emphasizes user experience, using read-only nodes, and even order placement is routed through backend relays rather than direct client API calls.

There are also some interesting products with different choices, such as Trade.xyz, which is currently the highest-volume platform on Hip3, focusing on expanding into stock trading rather than competing in the red ocean of existing markets.

VOOI Light is also quite capable (engineering-wise), a cross-chain perpetual DEX based on intent, connecting multiple Perps DEXs simultaneously—using engineering effort to operate multiple platforms at once. But it’s hampered by the complexity of managing multiple reserves, leading to a less smooth experience.

Recently, I also tested several AI trading platforms, most of which use open API integrations with multiple Perps backends. They are quite cutting-edge, including pure LLM-based text interactions, AI decision-making plus follow-trading modes (which can connect with trusted execution environments like Privy), enabling AI-assisted Perps trading without passing private keys to projects.

Different solutions offer different user experiences, which can partly explain the variation in final rebate data.

4. Reflection

The previous social login solutions only solve account recovery but do not address automated trading.

4.1 Reserve Complexity

This is often overlooked. Hyperliquid’s complexity far exceeds expectations, not just a simple “plug-and-play.”

Initially, many platforms optimistic about it as an aggregation DEX, but they ignore the fact that it’s not a Lego model—once integrated into Hyperliquid, if the market declines, do those functions still exist? How many wallets are shutting down their inscriptions protocols? And if the platform becomes unpopular, will users migrate to official platforms?

Furthermore, if Hyperliquid loses popularity and Aster or Lighter gains traction, will users migrate? The APIs are not fully compatible, so how to migrate or run in parallel?

To smooth out these issues inevitably increases user experience complexity.

Ultimately, since users want a comprehensive entry point, why not just use the official platform?

Front-end integration offers quick experience and coverage, but MetaMask seems to have taken a hit—no significant profit, yet it provides its user traffic freely.

Back-end integration offers the best experience, which is why Phantom earns the most revenue now, but it also incurs huge costs. The ultimate ROI (return on investment) is probably only known to them.

4.2 Why can’t total revenue break higher?

Looking back at our own preferences (focused on advanced Perps players), we prefer the full official entry, mainly on PC, because of visible features like take-profit/stop-loss, chart monitoring, margin modes, etc. This track is naturally dominated by high-end players.

Mobile users prioritize “monitoring market changes anytime, anywhere, managing positions and prices, not complex analysis.”

Thus, Phantom’s advantage diminishes after initial onboarding, as its focus is on mobile.

Platforms like BasedApp, which have both app and web versions, cater to both needs, but the web version also faces competition from the official entry, limiting growth.

However, Hyperliquid’s own app will soon be launched, further constraining the market.

The difference in architecture determines the value of integration, but the magnitude depends on the depth of integration. Ultimately, the ceiling of this model is still within industry competition—user contributions from entry platforms are hard to maintain within the original platform.

If wallets can provide advanced mobile features (advanced charting, alerts, auto-trading), that would create real differentiation. We see Phantom quickly adding such features to retain users.

The breakthrough paths include AI trading, auto-trading (a trading mode not offered officially), and multi-Perps aggregation. But issues like multi-platform reserve management, high AI loss rates, and the like remain. Even with industry-standard private key custody solutions (Prvy, TurnKey), users will naturally adopt what they know, and won’t learn what they don’t.

4.3 User Growth and Ecosystem Expansion

Many platforms’ initial goal is that they can accept not making money—since earning from fees is just a small part of the game. But attracting users who trade Perps or satisfying existing users’ perpetual trading needs is also a valuable ecosystem addition.

We can analyze this by looking at HL’s on-chain data, as this group is quite small.

From the chart below, the user base of each integration only shows a few thousand daily active users, totaling less than 10,000–20,000.

Looking at Hyperliquid’s own monthly active users, its revenue is fundamentally based on a whale service model, typical of the contract trading market’s Matthew effect and inverted pyramid capital structure.

Currently, HL has about 1.1 million total wallet addresses, with 217,000 monthly active and 50,000 daily active users. The key point is— the top 5% contribute over 90% of OI and volume, forming a typical pyramid.

The top 0.23% of users (about 500 with over $1M funds) control 70% of open contracts ($5.4B). The top 100 users hold an average of $33M each, with OI accounting for 920 times their user share.

In contrast, the bottom 72.77% (about 150,000 users) contribute only 0.2% of contract volume, with an average position of just $75.

This structure indicates that the contract market is essentially a game for professional institutions and high-net-worth individuals. Many retail traders form the user base and activity but have negligible capital impact.

This structure reflects a counterintuitive reality: Hyperliquid itself is highly profitable, becoming one of the most lucrative exchanges within a year.

But its profits mainly come from high-end whales, motivated by anti-censorship, transparency, or quant-driven trading.

The significance of platform integration is mainly for regular users. It requires long-term user education to transfer those playing Perps on CEXs into the Web3 Perps market, which is more competitive and homogeneous.

5. Final thoughts: Is integrating Perps really a good business?

Most projects need to adapt to the market, but when a platform reaches its peak popularity, the market tends to adapt to it. Hyperliquid is currently enjoying this status, but it may not sustain it—other competitors’ trading volumes are surging partly due to new airdrop expectations, which are not entirely real.

Many of HL’s initiatives are relatively correct. Compared to past platforms that often tried to do everything themselves and take all the red profits, I criticize Opensea for creating a mandatory royalty system that forces the market to follow the leader. Each time, it involves high fixed costs, interfering with product flow and market pricing, turning countless NFTs into heirlooms.

In HL, they open up EVM and all DEX Perps APIs, quickly leading to a proliferation of derivatives.

RWA assets, especially US stocks and gold, are becoming new traffic sources and growth points in the current Perp DEX field. TradeXYZ’s cumulative perp volume of $19.1B, weekly average $320M, daily average $45.7M, is the best proof.

Hyperliquid’s generosity is also evident in airdrops and buybacks. Many times, staking HYPE or engaging in ADL profit strategies can be quite promising.

In the end, the competition among leading platforms is a headache for a few. Regarding this year’s covert wallet integration battles, most third-party Perps integrations are low-ROI deals—whether in user growth, platform commissions, or stability investments, they are not really good business.

After seeing actual revenue data post-integration, many platforms are reluctant to give up the Perps track’s dividends. They will instead pursue in-house development and large-scale marketing. The race continues for another year, but only new users from outside CEXs are truly valuable users.

Disclaimer

This article is densely packed with information because many architecture overviews are highly condensed, and the technology is not fully open-sourced, based on publicly available information analysis.

Additionally, this discussion is purely from a technical solution perspective, with no positive or negative evaluation of any product.