Original author: Thejaswini MA
Original translation: Luffy, Foresight News
Jeff Yan has a soft spot for chameleons. Not in the metaphorical sense of changing color to blend in, but in the animal itself. His Twitter handle is @chameleon_jeff, and in a recent podcast, he explained this obsession: Chameleons can turn their eyes in different directions independently, two claws forward and three claws backward, which shows a very interesting evolutionary trajectory, and have powerful tongue-shooting abilities. Theyre a bit like aliens on Earth, he said.
This may seem like a strange opening, but it gives you a good idea of this man, who built one of the world’s largest trading platforms with a team of 10 and zero venture capital.
Hyperliquid has traded $1.8 trillion in the past 12 months. The platform accounts for more than 10% of global perpetual futures trading and more than 70% of perpetual contract trading on decentralized exchanges (DEX). More than 200,000 active users trade on the platform every day, generating hundreds of millions of dollars in revenue.
Jeff Yan didn’t set out to build one of the world’s largest decentralized exchanges. Yet, in less than two years, he did just that. Jeff found problems that others overlooked and solved them.
Systems Thinker
Jeff Yans journey into cryptocurrency began in Palo Alto, California, where he grew up in the heart of Silicon Valley. Unlike many of his peers who were focused on building consumer Internet companies, Jeff was interested in the intersection of mathematics, physics, and complex systems.
In 2013, when most high school students were still worried about their proms, Jeff represented the United States in the International Physics Olympiad and won a gold medal. This result was enough for him to enter any top university and even receive a lot of job offers before graduation.
It was no surprise that he went to Harvard to study mathematics and computer science, and immediately joined Hudson River Trading, the secretive high-frequency trading firm where people make millions just by being a few microseconds faster than everyone else.
“I learned a lot about markets and how to think about them rigorously,” Jeff said. At HRT, Jeff worked on complex problems that blended engineering and mathematics. He learned how to build low-latency systems that could execute thousands of trades per second. He understood how market makers provide liquidity and how different types of trading processes affect market efficiency.
After working at HRT for a few years, he sensed an opportunity and turned to exploring the crypto space.
In 2018, he tried to build a Layer 2 prediction market platform, and even raised some funds and moved to San Francisco to build a team. But that attempt ultimately failed, and regulatory uncertainty and low user acceptance ultimately led to its demise. This also allowed Jeff to learn valuable lessons and understand what cryptocurrency users really want.
Jeff Yan refocused on trading after his prediction market platform failed between 2018 and 2022. He initially traded cryptocurrencies as a sideline and soon discovered significant inefficiencies in the market. Recognizing an opportunity, he expanded his business and founded crypto market-making firm Chameleon Trading in early 2020. During the bull run, the company quickly grew to become one of the largest market makers on centralized crypto exchanges, cementing Jeffs reputation in quantitative trading.
Then, FTX had problems.
In November 2022, Sam Bankman-Frieds empire collapsed, and the exchange, once seen as the future star of cryptocurrency, collapsed. Remember FTXs $135 million naming deal with the stadium? They have celebrity endorsements such as Tom Brady and Larry David.
“We saw the problems with FTX firsthand,” Jeff recalled. “People realized that crypto was supposed to be a fun game, but it wasn’t until something bad happened that it stopped being a fun game.”
Jeff saw billions of dollars evaporate overnight because users entrusted their funds to a centralized platform. Most people would see this as a warning to stay away from cryptocurrency, but Jeff saw it as a challenge.
Building a Rocket in the Garage
The obvious solution is to build a decentralized exchange that can compete with the large centralized exchanges. Simple in idea, but nearly impossible to pull off.
Every blockchain Jeff looked at had problems. Ethereum was too slow; Layer 2 solutions added latency; Solana was relatively fast, but still not fast enough for large-scale transactions. All options required compromises and would ultimately make exchanges worse than they already were.
So, Jeff made a reasonable decision: due to the rigid demand for user experience, he decided to build his own blockchain from scratch.
The end result is Hyperliquid, a blockchain designed for trading that can handle 200,000 transactions per second with near-instant finality, allowing users to use up to 125x leverage in over 145 different markets while keeping their funds safe.
Most startup stories revolve around raising $50 million from top VCs and then hiring hundreds of engineers to scale. However, Jeff did it differently. He used the profits from his trading company to fund development and kept the team lean, at just 10 people.
“We started from scratch,” he said. “We didn’t need any funding, so it was an easy decision.”
Jeff believes that venture capitalists holding large stakes in decentralized networks will become a scar on the network and harm its long-term development.
This bootstrapped approach allows Jeff to focus entirely on building a product that users love, without having to cater to investor expectations. This also enables one of Hyperliquid’s most innovative features: when the platform launches the HYPE token in November 2024, 31% of the token supply will be allocated directly to users based on their trading activity. This is one of the largest user-centric token allocations in the cryptocurrency space. The remaining tokens are allocated to future community rewards (38.88%), core contributors (23.8%), the foundation (6%), community grants (0.3%), and a small amount of funds for protocol upgrades (0.012%).
This token distribution was possible because Jeff did not sell equity to VCs, who would have demanded a priority distribution. By remaining independent, he could prioritize community ownership over investor returns.
When Hyperliquid launched in 2023, there were no press releases, no KOL partnerships, and no billboards in Times Square. Jeff simply opened the door and waited for the future.
What followed was explosive growth that caught everyone off guard. Within 100 days, daily trading volume reached $1 billion. By mid-2025, monthly trading volume will reach $2.48 trillion, putting Hyperliquid on par with Binance and Coinbase.
Hyperliquid has grown from zero to over 545,000 users in just two years.
“We don’t have a marketing department,” Jeff admitted. “I think our community does a great job, better than the marketing departments of all those centralized exchanges.”
This wasn’t luck. Jeff designed the entire platform around how to align incentives with users, rather than extracting value from them.
This is too radical an approach to be emulated by other exchanges even if they want to. After all, when you have raised hundreds of millions of dollars from venture capital firms, you can’t just give away most of your tokens to users for free.
Ecosystem
Although Hyperliquid started out as a perpetual futures exchange, Jeff’s vision was always to go beyond simple trading. In early 2025, the platform launched HyperEVM, an Ethereum-compatible virtual machine that allows developers to build financial applications directly on Hyperliquid’s blockchain.
The ecosystem is developing rapidly: Felix, a collateralized debt position protocol, currently manages more than $400 million in assets, and HyperLend, a lending protocol, manages $380 million. Jeff said that the ultimate vision is to centralize all financial operations on one platform.
The problem Jeff discovered is common to all cryptocurrency exchanges: experienced high-frequency traders use robots to quickly buy or sell after market makers publish prices, even before they update their quotes when prices change. As a result, market makers are forced to widen spreads to protect themselves, and ordinary traders end up paying higher fees.
Hyperliquid solves this problem by deprioritizing fast “taker” orders. Instead, the platform gives market makers a fair chance to update prices, which means lower spreads and better prices for all users.
The platforms order matching engine uses a price-time priority mechanism with additional rules for smooth execution. Under certain conditions, special orders such as cancel orders and pending orders can be given higher priority than ordinary orders, which means that market makers can respond to new information and adjust their quotes to avoid being sniped by fast traders.
This subtle change encourages market makers to quote lower spreads because they are less likely to lose money due to latency arbitrage. Ultimately, everyone on the platform gets better prices and higher liquidity. All of this happens on-chain, so the entire process is transparent and users are able to see fairer and more consistent results.
This technical depth is probably why professional traders (who are most sensitive to execution quality) choose to use Hyperliquid despite having access to every centralized exchange in the world.
What happens next
However, Jeff was faced with an interesting problem: How to scale a 10-person company processing trillions of transaction volume?
His solution was, as always, counterintuitive: instead of hiring more people, he built tools that would allow others to build applications on Hyperliquid.
“If something can be done by someone else, it should be done by someone else,” Jeff said. “There’s almost nothing we can do. I think it’s a blessing in disguise.”
The platform recently launched a permissionless market creation feature that allows anyone to create new trading markets by staking HYPE tokens. However, a threshold of 1 million HYPE tokens (worth tens of millions of dollars) is required, which means that not everyone can enjoy this service. For users who reach the threshold, developers can keep 100% of the fees for the markets they create, which is something that no traditional exchange can offer.
Jeff is also in talks with sovereign wealth funds to build financial infrastructure, but he won’t name specific countries. The goal is to prove that decentralized systems can handle the size and complexity of national financial systems.
In July 2025, Sonnet BioTherapeutics, a Nasdaq-listed biotech company, announced its entry into the cryptocurrency space by establishing an $888 million entity focused on holding HYPE tokens. The transaction will make the newly renamed Hyperliquid Strategies Inc. the company with the most HYPE among US listed companies.
In an industry full of grandiose promises to revolutionize everything, Jeff built something simple but effective. No high-profile claims of serving the unbanked, no grand vision of Web3 changing the world, just a platform that traders really like to use.
“We focus on building products that users love,” Jeff explained, “and everything else is secondary.”
The approach seems to be working. Hyperliquid currently handles more than 10% of the world’s cryptocurrency derivatives trading, and it operates with a team of 10 people and no marketing budget. To Jeff, it was just another engineering problem to solve.
