Will HYPE be the next SOL?

TechFlow
TechFlow
SOL-6.77%
SUI-10.25%

By Jack Kubinec

Compiler: TechFlow

Next, we'll dive into Hyperliquid vs Solana Contrast: Will HYPE be the next SOL?

WILL HYPE BE THE NEXT SOL?

Among the cryptocurrencies issued after the collapse of FTX, there are very few in the top 15 by market capitalization. The two exceptions are: UI, which started trading in mid-2023; HYPE, whose market capitalization has soared to more than $11 billion since its airdrop in November 2024.

As the native token of Hyperliquid Layer-1, HYPE has more than tripled in price since its local low on April 6, 2024, far outpacing Solana's roughly 70% increase over the same period. HYPE has undoubtedly garnered a huge amount of attention for crypto investors looking for the next Layer-1 token that could bring Solana-like returns. Even Galaxy's Mike Novogratz has jumped on the bandwagon.

HyperLiquid's core Layer-1 appchain, HyperCore, is designed for its order book exchange, which generates revenue through transaction fees and is used for token buybacks. The product has been hugely popular: according to Artemis, in April 2024, Hyperliquid accounted for 77% of on-chain perpetual contract trading volume.

In addition, Hyperliquid has launched an Ethereum Virtual Machine (EVM) network called HyperEVM, but its adoption rate is currently nowhere near as high as HyperCore.

There is some disagreement in the market regarding the valuation of HYPE: should it be seen as a decentralized exchange (DEX) token saturated in demand in the perpetual contract market? Or should it be seen as a Layer-1 token that can compete with Ethereum and Solana?

Currently, the pricing of HYPE sits somewhere in between. Syncracy Capital's Ryan Watkins, who holds both HYPE and SOL in his portfolio, released a chart in early March showing that Hyperliquid's trading fee multiples are lower than other Layer-1s, including Solana.

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