Hyperliquid: A Low-Profit Model Under Nasdaq-Level Trading Volumes

Hyperliquid has currently reached the clearing scale of top-tier trading venues but only achieves a relatively low monetization efficiency. In the past 30 days, its perpetual contracts' nominal trading volume reached hundreds of billions of dollars (annualized scale exceeding trillions), but the protocol fees generated are only in the tens of millions of dollars, with an effective monetization rate maintained at single-digit basis points (around 4 bps). This makes its monetization more akin to a wholesale execution platform rather than a retail-oriented revenue machine.
In contrast, Coinbase reported a total trading volume of approximately $295 billion in Q3 2025, with trading revenue exceeding $1 billion, implying a monetization rate of over 30 basis points. Robinhood also demonstrates high retail-like monetization features in the crypto space: its quarterly nominal crypto trading volume is about $80 billion, generating approximately $268 million in trading revenue, with a monetization rate of about 33 basis points; during the same period, its stock trading volume was much higher, reaching trillions of dollars.
The gap between the two is not only in fee rates but also in the diversified monetization channels of retail platforms. Robinhood, in Q3 2025, besides trading revenue, also generated substantial net interest income (from user balances) and subscription service income (such as Gold memberships).
Hyperliquid, on the other hand, heavily relies on protocol-level trading fees, which are structurally limited to low basis points levels due to Maker/Taker models and liquidity rebates.
Positioning Differences: Broker Distribution vs. Pure Market Layer
The core of this difference lies in business positioning: Coinbase and Robinhood are essentially brokers/distributors, controlling customer relationships, asset balances, and multi-dimensional monetization; Hyperliquid is closer to a pure exchange (market layer). In traditional finance, profits are mainly concentrated at the distribution layer, while the market layer is often commoditized and low-margin.
1. Broker Distribution Layer: The Core of High Profitability
Brokers directly face users, controlling deposits, custody, risk management, and customer service, routing orders to exchanges. This brings strong monetization beyond trading:
• Balance Management: cash sweep spreads, margin trading, securities lending.
• Product Packaging: subscription services, bundled products, membership benefits.
• Routing Economics: order flow payments (PFOF) and revenue sharing.
This explains why brokers often profit far more than exchanges—the profit pool leans toward customer relationships and balances.
2. Exchange Layer: Commodification of Infrastructure
Exchanges are responsible for matching, rule-setting, and executing infrastructure, with main revenue sources including:
• Trading Fees: high liquidity products face fierce competition, leading to continuous fee reductions.
• Liquidity Rebates: to attract Makers, most fees are often rebated.
• Ancillary Revenue: market data, connectivity services, listing fees.
In traditional finance, Nasdaq is a typical example: its net capture rate for execution business is extremely low, constrained by regulatory caps, routing competition, and rebate pressures. In recent years, Nasdaq has gradually shifted from transaction-sensitive business to high-stickiness revenue from data/software, with trading services share continuously declining.
Robinhood’s order routing model clearly reflects this layering: brokers control user flow and monetization, while exchanges only provide execution.
Hyperliquid’s “Nasdaq-style” Path
Hyperliquid’s effective monetization rate of about 4 basis points aligns closely with its positioning as an on-chain high-performance execution layer. It has built a decentralized infrastructure similar to Nasdaq: high-throughput HyperCore, clearing stack, Maker/Taker pricing, and liquidity rebates, prioritizing execution quality and shared liquidity over retail capture.
This is reflected in two unique designs:
• Builder Codes: licensed third-party frontends built on the core, charging fees independently (up to 10 bps for perpetuals). This stimulates distribution competition, breaking the native UI’s monopoly.
• HIP-3: externalized product listings, allowing deployers to inherit the core stack to create perpetual markets, and retain up to 50% of trading fees.
Builder Codes have already shown results: some user traffic has shifted to third-party frontends.
Structural Challenges and Risks
Open distribution accelerates growth but may suppress core protocol revenue:
• Rate Competition: multiple frontends selling the same liquidity, driving overall costs down.
• Monetization Spillover: frontends control deposits, subscriptions, and user stickiness, capturing broker-layer profits.
• Routing Risks: if frontends evolve into cross-platform aggregators, Hyperliquid may fall into wholesale execution bidding wars, relying solely on fee reductions or increased rebates to maintain traffic.
Hyperliquid intentionally chooses a low-profit market layer, allowing high-margin broker layers to grow on top. If third-party frontends dominate, this could suppress protocol monetization in the long term, with the greatest risk being complete commodification—becoming a low-margin liquidation channel.
Recent Strategic Adjustments: Defensive Distribution and Diversified Revenue
Latest initiatives show Hyperliquid actively responding:
• Native UI Defense: withdrawing proposals that might subsidize third-party staking discounts; prioritizing HIP-3 markets on the native frontend to maintain core distribution competitiveness.
• USDH Stablecoin: reclaiming reserve yields (50% to the protocol for ecosystem growth) and offering fee discounts for USDH trading pairs. Moving towards a form of annuity income that grows with balances rather than relying solely on trading. Although USDH supply remains low, its potential lies in internalizing user reserves.
• Portfolio Margin: unifying spot/perpetual risk offsets, introducing native lending cycles, with the protocol taking a 10% interest on loans. This injects financing economics, similar to a prime broker model.
Outlook for 2026: Evolution of a Hybrid Model
Hyperliquid has reached a trading scale comparable to top venues, but its monetization still reflects market-layer characteristics: massive trading volume with low basis point capture. The structural gap with retail brokers is clear—latter control relationships and balances, with multi-pool monetization; pure exchanges sell “execution,” vulnerable to commodification through competition.
The initial open design (Builder Codes and HIP-3), though sacrificing some profit, drives ecosystem expansion. Recent shifts aim to defend distribution, internalize revenue, and build balance/financing pools outside trading fees, reducing pure wholesale risks, and moving towards a hybrid model: a unified underlying execution layer with broker-like overlay elements.
The key question for 2026 is whether Hyperliquid can, while maintaining an open ecosystem, successfully capture more broker-level profits. USDH is an important indicator—if growth is slow, stronger native integrations (such as default reserve conversions) may be needed to accelerate. If it can balance openness and control, it will evolve from a pure Nasdaq simulator into a more comprehensive on-chain financial infrastructure.