Tokenized Equity Market on Hyperliquid Heats Up

A notable difference between TradeXYZ‘s markets and those deployed by Felix and Ventuals is that the XYZ markets are denominated in USDC, the dominant stablecoin on Hyperliquid, while Felix and Ventuals settle in USDH, Native Markets’ recently launched stablecoin.

This move marks the first true source of demand for USDH, which will funnel 50% of the yield on its reserves towards buying HYPE tokens.

All new markets have been launched with low open interest caps, which are expected to be raised over time as the teams continue to monitor their performance.

Scaling and Distribution in HIP-3 Markets

Charlie, a contributor at Felix Protocol, spoke to The Defiant about new HIP-3 developments, including liquidity fragmentation across markets that represent the same tokenized equity, and how the market can expect HIP-3s to grow beyond a crypto-native audience.

He said there is currently an overlap between Unit and Felix, both of which offer tokenized TSLA markets. However, this overlap is set to diverge as Felix develops separate businesses that do not rely just on Hyperliquids UI as the main TSLA/USDH distribution source.

Charlie added that using USDH offers several advantages, including 20% lower taker fees, 50% higher rebates, and 20% higher volume contributions. “This means it should be cheaper and more liquid for you to trade the same market on Felix – additionally, our fee schedule will be lower as well. So the primary differentiator out of the gate between Felix and Unit is cost.”

While HIP-3 perpetual markets are still in their infancy, even in crypto-native use cases, teams are looking to expand the HIP-3 funnel and attract traditional finance traders as well.

“I think this [distribution to non-crypto audiences] will primarily come down to regulatory clarity and distribution, and the two play into one another. Once one major player starts integrating perps and then equity perps due to customer demand, regulatory clarity follows.”

“On the distribution side, non-crypto-natives likely do not want to go through the complexities of wallet management, etc, to trade these markets. Thats where something like a Privy + Hyperliquid builder code integration into a known interface like Bloomberg bridges the gap,” Charlie concluded.