"We're not TradeXyZ: The cruel truth behind the closure of the first HIP-3 platform."

A new IPO launch pricing in the United States stock market and a campaign to sustain the trade of hungry and thirsty funds after weekend breaks, for & nbsp;Hyperliquid  has experienced an epic price discovery. HYPE, the newest HYPE in history, has drawn the attention of global traders to this 7x24-hour platform and a team strength called TradeXYZ。

Hyperliquid is a high-performance block chain specially designed for derivatives with a fully-fledged order book. The HIP-3 is its third improvement proposal: anyone who pledges about 500,000 HYPEs as a deposit can open their own permanent contract market on this chain, trading in American shares, indices, large commodities, and not even IPO companies. Hyperliquid provides blending, bonding and chain settlement, and deployrs define for themselves which transactions are correct, what predictors are used, and how high leverage is set。

TradeXYZ is the first trading platform to be deployed under the HIP-3 framework. Through weekend market pricing and IPO pre-board contract transactions, TradeXYZ has attracted Wall Street attention in less than a year。

In addition to TradeXYZ, several other HIP-3 trading platforms were deployed to try to replicate the success of HIP-3 through their respective strengths。

However, the results were unsatisfactory。

Recently, the Hyperliquid Ecology Project Felix announced that its HIP-3 trading platform would be shut down on 19 June and that all markets would be liquidated individually。

Felix was the first HIP-3 trading platform to deploy silver and crude oil transactions on Hyperliquid, OIL, GoLD, SILVER, which brought considerable transaction costs and about $3 billion to it between December and January this year. Now it's the first HIP-3 deployment to officially exit。

Why did a player who was a leading player close the door first

"We're not TradeXyZ."

Felix founder 0xBroze reset this failed attempt。

First, the quoted assets were selected wrongly. The HIP-3 trading platform was to select a stable currency for a lasting contract, and the earliest on-line TradeXYZ chose USDC, which was not a considered decision at the time, because Hyperliquid had not started the bid for a stabilization currency, and Felix had come up late and the choice of USDH was a natural decision, because the USDH was used to get a discount。

What they did not expect, however, was that later, when Hyperliquid opened up Growth Mode, transaction costs were down sharply, leaving little of USDH's advantage, and it became "a burden of mobility fragmentation". Users have USDC, which needs to switch to USDH in order to use Felix, and marketers are reluctant to provide liquidity for USDH-related markets. After all, USDH is more like a chess piece set up by Hyperliquid to force Circle to split。

Second, TradeXyZ came first. It opened on the day the HIP-3 went online, about a month before Felix. The month was not just a time lag, with early branding pre-empting users ' minds, but also ample time to push the next market forward。

Besides, TradeXyZ deals more. As the only deployer using USDC, TradeXYZ quickly built the moat with the trade. In the view of 0xBroze, most of this has a balance sheet advantage. TradeXYZ can afford the cost of the Ticker auction, and the cost of liquidity. Felix, on the other hand, has limited funds and can only be more cautious in choosing between opening transactions。

Finally, "aerial drop hint." The early users of TradeXYZ speculated that they would issue currency, because the team behind TradeXYZ had auctioned the spot at Hyperliquid to get the Ticker UNIT. Airdrops are expected to raise the number, turnover, unsettled contracts and liquidity of TradeXYZ in the early days, creating a flying wheel that Felix will never catch。

In summary, we failed because we were not TradeXYZ。

The Mater Effect

Let's see the trade. As of the first week of June, TradeXYZ alone accounted for 95.85 per cent of the HIP-3 trade. The remaining 7 families add up to less than 5 per cent, the second is 2.75 per cent dreamcash, and the third, Kinettiq, is 0.64 per cent and HyENA 0.49 per cent。

Source: ASXN

Unsettled contracts are more concentrated, with TradeXYZ accounting for 96.81 per cent。

Source: ASXN

Such monopolistic patterns have almost always prevailed. From October of last year when the HIP-3 proposal came online, to May this year, TradeXyZ was never less than 60%。

In the first week of June, the total trade value of HIP-3 was $4.8 billion, of which XYZ100/USDC of TradeXYZ contributed $4.53 billion to a deal。

Source: ASXN

High costs, low returns

TO UNDERSTAND WHY OTHER DEPLOYERS ARE LIVING SO HARD, IT IS NECESSARY TO SPLIT THE ACCOUNT OF OPENING AN HIP-3 TRADING PLATFORM。

TWO OF THE COSTS ARE PRICED. THE DEPLOYMENT OF AN HIP-3 TRADING PLATFORM REQUIRES A PLEDGE OF 500,000 HYPES, OR APPROXIMATELY $30 MILLION (HYPES AT $60 PRICES)。

You can't do that

The second cost is the Ticker auction, where every new transaction is paired with a new Ticker, the average price of which is around 500 HYPE, or about $30,000. The auction market is now also monopolized by TradeXYZ, and non-tradeXYZ players have become less enthusiastic about the auction since February。

Source: Blockworks Research

THE OPENING OF AN HIP-3 TRADING PLATFORM IS NOT ONLY COSTLY BUT ALSO PROFITABLE。

In order to match the rate of the permanent contract with the traditional voucher, Hyperliquid introduced Growth Mode. When the Growth Mode was opened, the Tucker rate was cut to a very low level, and the user opened a NVDA warehouse here, cheaper than in a permutated security. The cost is that those deploying can only receive about 10 per cent of the potential fee income。

IF A DEPLOYING OFFICER DOES NOT OPEN A TRADING PLATFORM, HE WILL TAKE 500,000 HYPES DIRECTLY TO THE PLEDGE, AT AN ANNUALIZED RATE OF ABOUT 2.3 PER CENT, AND HE WILL RECEIVE APPROXIMATELY $60,000 PER MONTH. IN OTHER WORDS, IF THE OPPORTUNITY COST OF DOING NOTHING IS TO BE RECOVERED IN ORDER TO OPEN A TRADING PLATFORM, IT WILL COST MORE THAN $60,000 A MONTH。

This is the collection of trading platforms in May: TradeXYZ earned about $3.1 million, dreamcash about 89,000, Kinettiq about 21,000 and HyENA about 16,000. A few more, they're under $5,000。

Except TradeXyZ, only dreadcash barely returns. All remaining deployments, even the opportunity cost of 500,000 HYPE, were not covered. This does not take into account the more difficult expenses of markets, prophecies, team salaries, mobility incentives。

Source: Blockworks Research

People

There are several trading platforms that are still struggling with each other。

dreamcash 's quoted asset is USDT0, followed by Tether. Tether gave it a weekly trade incentive of approximately US$ 200,000, converted about US$ 86.67 million a month, far exceeding the Platform ' s fee revenue. Added to a projection of air drops, dreamcash sat firmly in the second place of exchange。

Kinettiq Markets has an innovative "pooling mechanism". Kinetiq developed a platform called Launch. The founder, Omnia, described it as a combination of "Shopify + Kickstarter" that would allow others to deploy their own customized HIP-3 trading platform with the raised 500,000 HYPE. Markets is a model of this model to prove that Launch's model runs, not goes to TradeXYZ to rob traffic。

There's a long way ahead

Felix will certainly not be the last failed HIP-3 trading platform. Because there is not much room for adjustment for other players。

Maybe it can be a cold or new market that TradeXYZ doesn't want to touch, but Felix has tested for everyone, and the end of the road is "to be copied and bled by TradeXYZ once made."。

Or a distribution channel to create its own user base in a net new market, bypassing the Red Sea, the primary trader of Hyperliquid, the Kinetiq's Launch, is an attempt in this direction, but has not really run out。

However, if the cost end is not relaxed, the current unique pattern is likely to maintain。

A proposal has been made in the community to lower the pledge threshold of 500,000 HYPE and to set a price for the auction that follows the price of HYPE but lower. From this perspective, the decline in hype prices is not necessarily bad, because it allows more projects to build on Hyperliquid at lower cost。