Zero-Fee Exchanges Threaten Hyperliquid’s Survival, Arthur Hayes Warns

• Arthur Hayes says zero-fee trading could threaten Hyperliquid’s sustainability.
• Traders argue Hyperliquid’s superior product offsets fee competition.
• Hyperliquid maintains strong trading activity with $9.49 billion in daily volume.

BitMEX co-founder Arthur Hayes has warned that major centralized exchanges offering zero-fee trading are trying to push the decentralized exchange Hyperliquid out of the market.

In a conversation shared by journalist Laura Shin, Hayes said Hyperliquid’s business model depends on trading fees that fund buybacks of its native HYPE token.

“If HYPE makes no money and they buy back no tokens, then all that trading volume is going to go away,” Hayes said.

He argued that centralized exchanges are temporarily cutting fees to weaken Hyperliquid and will raise them again once they’ve gained back market share.

Related: ZEC Near $400 on Hayes $10K Call, Hyperliquid ZEC Futures Listing, Grayscale Zcash Trust Launch

Hyperliquid’s Model and Market Position

Hyperliquid, founded in 2023, operates as a decentralized perpetual futures exchange built on its own Layer 1 blockchain. It allows leveraged trading with a 0.025% taker fee and a 0.002% maker rebate.

Despite growing fee competition across the industry, Hyperliquid remains one of the busiest decentralized exchanges. Recent data shows:

• $9.49 billion in 24-hour trading volume (up 22.8% from the previous day)
• $9.28 billion in open interest across 191 pairs
• Open interest peaked at $14.97 billion on October 13, a 37% drop over two weeks

For comparison, leading centralized exchanges like Binance, Bybit, and OKX handle $25–$90 billion in daily derivatives volume, typically with base fees around 0.1% before discounts.

While smaller in scale, Hyperliquid’s low fees and decentralized design continue to attract traders who value transparency and efficiency.

Traders Defend Hyperliquid

Many community members pushed back on Hayes’ warning, arguing that Hyperliquid’s success doesn’t rely on fee advantages alone. Trader Permacope said that even with zero-fee offers elsewhere, “people simply prefer HL’s product.”

Another user pointed out that Hyperliquid’s fees are already so low that centralized exchanges would lose money trying to undercut them. Competing decentralized projects, they added, would need major funding to replicate Hyperliquid’s setup.

Exploring Other Revenue Models

A commentator known as “Crypto Tax Made Easy” noted that many “zero-fee” exchanges still earn money by charging professional traders and market makers, similar to Robinhood’s model.

They suggested Hyperliquid could adopt a similar approach without sacrificing decentralization, though it might upset some community members.

Related: Hyperliquid Price Prediction: Can HYPE Break $50 Resistance?

Meanwhile, DeFi Moon argued that Hyperliquid’s strong liquidity, reliability, and performance during volatile markets are more valuable to large traders than small fee discounts.