Hyperliquid Enters the DeFi Space with HyperEVM, a General-Purpose EVM Natively Built into Its Layer-1 Blockchain

Hyperliquid is entering the DeFi space with HyperEVM, a general-purpose Ethereum Virtual Machine (EVM) natively built into its layer-1 blockchain.

Hyperliquid is making waves in the DeFi realm with the integration of HyperEVM, a general-purpose Ethereum Virtual Machine (EVM) built into its layer-1 blockchain. To bolster the security of this project, the company has announced a bug bounty program, offering up to $1 million for the detection of critical security vulnerabilities. This move is part of a broader strategy to foster trust and innovation within their ecosystem.

Hyperliquid’s approach to EVM differs from the typical bolt-on solution for a chain. Instead of building a separate EVM chain, HyperEVM is fully integrated with Hyperliquid’s layer-1 infrastructure. This integration, combined with Hyperliquid’s unique architecture, provides several advantages.

Firstly, unlike many EVM-compatible chains, HyperEVM leverages the robust HyperBFT consensus mechanism, enhancing the security of the EVM itself. Secondly, this integration enables direct communication between HyperEVM and the native components of Hyperliquid. For instance, a decentralized finance application built on HyperEVM can easily access Hyperliquid’s spot and perpetual order books.

In the words of Hyperliquid, “Ultimately, users will be able to trade a project token with minimal fees and deep liquidity on the native spot order book, and seamlessly use the same asset on applications built on the EVM.”

Another unique aspect of HyperEVM is its native support for the HYPE token, which can be used as both an asset and a gas token. This integration simplifies transactions and enhances user engagement, unlike traditional bridges that require separate handling of gas tokens.

Hyperliquid’s commitment to security is evident in their recent announcement of a bug bounty program. This program invites the community to participate in strengthening the platform's security during the testnet phase. The company will reward researchers with up to $1 million in USDC for discovering and reporting critical vulnerabilities.

The program classifies bugs based on their severity, with higher rewards for more impactful vulnerabilities. The bounty specifically targets bugs that could affect the core functionality and interaction of Hyperliquid’s nodes, API servers, and the EVM during the testnet phase. However, reports lacking sufficient detail or vulnerabilities requiring unrealistic user behavior to exploit will not qualify.

This initiative aligns with Hyperliquid’s goal of continuous innovation and community engagement, as they pave the way for broader mainnet launch and development on HyperEVM.

Hyperliquid’s HYPE Token and TVL: A Thriving Ecosystem

The unveiling of HyperEVM did not drive the HYPE token to a much higher price point (circa $26) in the following days; however, Hyperliquid’s total ecosystem is certainly bullish. With a total market capitalization of $8.6 billion and daily trading volume of more than $200 million, HYPE has a strong level of activity.

Moreover, according to DeFiLlama, TVL was reported to have exploded up to $677 million in February from the earlier December's $227 million, a record surge of 300%. This might be read as the users’ belief in the aptitude of the unrest.

Hyperliquid’s History of Rewarding Users: The Airdrop Factor

It would be remiss not to mention Hyperliquid’s highly successful airdrop when discussing the project's ecosystem and user engagement. Hyperliquid has made the DeFi ecosystem a talking point by giving away 28% of its total token supply to users. At current market prices, this airdrop is worth over $7 billion.

This headline move was designed to push the inception of the company and its product into the hands of early users and power traders on the platform. Airdrops can have both advantages and disadvantages, but it is a common strategy for upcoming projects to reward early users, increase visibility, and distribute tokens widely. However, it is worth noting that this kind of reward does not assure true engagement with the platform.

HyperEVM: Accessibility and Development

Hyperliquid has been given the chain ID 999 for mainnet HyperEVM. One among several measures that will be taken is that Hyperliquid will run a JSON-RPC server for the mainnet HyperEVM and facilitate node operators and other developers to run their own RPC servers for flexibility, decentralization & wider access. Along with the launch, an additional Bug Bounty Program with mainnet bounty rewards for reports that fall within the defined scope has been imposed.

The raw HyperEVM block data is actually a continuous data stream written to S3 to solve problems and support development. No need to possess a node to index the HyperEVM. Therefore, HyperEVM is more accessible for developers. You can add these features into Layer 1 state, allowing a seamless interaction without the need to interrupt the low-latency trading experience of current users.

General ERC-20 native transfers and precompiles will be supported in the future network upgrade. We will be highly appreciative of any feedback or comments about newly adopted features on the testnet.