Earlier this month, a cryptocurrency market crash swept the globe, bringing focus onto Hyperliquid, an exchange that processes over $13 billion in daily trading volume with only about 11 employees, primarily based in Singapore.

This two-year-old exchange, though little-known outside the crypto market, is extremely popular among traders because it offers anonymous trading, high leverage, and airdropped a token whose value has skyrocketed. Hyperliquid has no external investors and, based on its disclosed trading volume and fees, generates over $1 billion in annual revenue.

Following the market crash, the platform gained attention for liquidating over $10 billion in trades that day, potentially exacerbating the sell-off. Hyperliquid also came under scrutiny because two user accounts placed massive short bets on the market just minutes before President Trump announced significant tariff hikes on China.

"Hyperliquid is extremely unique," said Ash Egan, founder of the crypto venture fund Archetype. "It's rare to see successful founders choose to be completely self-funded" to start a company and issue a token, said Egan, whose fund holds Hyperliquid's token.

Jeff Yan, who graduated from Harvard in 2017 and grew up in Silicon Valley, created Hyperliquid in response to collapses like that of FTX, a centralized exchange that held user assets. Hyperliquid is decentralized, meaning its algorithms match buyers and sellers, and customers custody their own assets. Jeff Yan has grand ambitions for Hyperliquid, hoping it can trade various assets.

The exchange, developed by a team in Singapore, does not allow US traders to participate, but they can access it via Virtual Private Networks (VPNs). Nonetheless, Hyperliquid is growing rapidly, and its trading volume now equals about 10% of similar products on the world's largest crypto exchange, Binance. Its growing size and use of derivatives have raised concerns that it could accelerate market crashes.

Yan, the son of Chinese immigrants, attended math summer camps as a child and went to Palo Alto High School in the heart of Silicon Valley. He won silver and gold medals in the International Physics Olympiad, the world's most prestigious physics competition for high school students. After graduating from Harvard, he joined New York high-frequency trading firm Hudson River Trading as an algorithm developer but left in less than a year.

Those who know Yan say he is technically skilled and ambitious, attracting numerous talented individuals to his projects.

His first startup, founded in 2018, was a prediction market, but it failed. Subsequently, he founded the trading firm Chameleon Trading in Puerto Rico, hiring Denis Yarats, who later co-founded the AI search engine Perplexity AI, and Jacob Jackson, now a researcher at the coding assistant Cursor. The company quickly grew into a significant trading platform. Yan previously stated that the company never traded on FTX due to distrust of the platform.

After FTX's collapse in late 2022, Yan began building Hyperliquid. Instead of raising funds through venture capital, Hyperliquid bootstrapped by issuing its own token, HYPE. According to people familiar with the matter, major venture capital firms including Paradigm and Founders Fund expressed interest in investing in Hyperliquid but were rejected. Instead, Hyperliquid gave away 31% of the total token supply to users based on their trading volume. This giveaway, known as an "airdrop," attracted more users.

"When Hyperliquid started, the standard practice was to raise large sums from VCs, then create hype—followed by round after round of financing," Yan said in an August interview on the Wu Blockchain podcast. "But that always felt somewhat fake to me. That wasn't real progress."

The company makes HYPE more attractive by using most of the fees generated by the trading platform to buy back tokens in circulation, reducing supply and driving up the price. The price of HYPE jumped from $3.90 at its issuance last November to its current $38. The total value of HYPE tokens in circulation is about $10 billion, making it one of the most successful token launches in history.

The 310 million tokens distributed by Hyperliquid were worth $1.2 billion immediately after the airdrop. "It was exhilarating to see tens of thousands of community members receive life-changing wealth," Yan tweeted the day after the token launch. According to disclosures and reports from The Information, almost all major crypto funds—Paradigm, a16z, Pantera, Galaxy Digital, Hivemind, CoinFund—now hold HYPE tokens.

Additionally, Hyperliquid is attracting capital from US stock market investors. A Nasdaq-listed US company, Hyperliquid Strategies, announced in July plans to accumulate $888 million worth of HYPE tokens, allowing investors to effectively buy the token like a stock. Former Barclays CEO Bob Diamond will serve as the company's chairman. However, the deal has not yet been completed, and the stock has fallen 64% since the announcement. Another Nasdaq-listed company, Hyperion DeFi, has purchased 1.7 million HYPE tokens, worth $59 million at the current token price.

Hyperliquid attracts traders by offering anonymity and high leverage. Most of the platform's volume comes from perpetual futures, a type of leveraged derivative with no expiration date that is not available on US platforms.

Because Hyperliquid only provides trading software and does not act as a broker, it is not responsible for verifying user identities. Trades by anonymous users sparked a storm of speculation on October 10th, when two accounts bet the market would fall just minutes before Trump suddenly announced 100% tariffs on Chinese goods. Traders speculated that the people placing these bets must have had insider information from someone in the White House.

"Hyperliquid benefits from the fact that many people want to trade anonymously," said Matt Zhang, founder of crypto fund manager Hivemind.

After Trump's announcement, the crypto market plummeted, and the two bets paid off handsomely. High leverage accelerated the sell-off. Hyperliquid's algorithms forced traders to close positions to protect the exchange from significant losses. According to CoinGlass data, Hyperliquid liquidated over $10 billion worth of trades that day, while the industry's total liquidations were at least $19 billion, the largest in history, which intensified the market sell-off.

Traders using leverage always face potential liquidation risks when markets fall. Like other crypto exchanges, Hyperliquid forces trades to close during market turbulence, which has surprised many traders and disrupted their hedging strategies. Hyperliquid is not globally regulated, meaning users have little recourse if something goes wrong.

Hyperliquid discloses very little information about its core team. Besides Yan, most members are anonymous or use pseudonyms, including another co-founder "iliensinc," who also graduated from Harvard. A core contributor using the pseudonym Xulian is responsible for marketing strategy. According to Hyperliquid's website, this employee is from Caltech and MIT and previously worked at Citadel, Hudson River Trading, and productivity app maker Airtable.

Yan spends most of his time improving Hyperliquid's blockchain and encouraging companies to launch products on it. He typically responds to developers' questions on Telegram within 24 hours.

"He has no board. No investors calling him up and yelling at him, telling him what he must do or not do," said David Schamis, founding partner of private equity firm Atlas Merchant Capital, who will serve as CEO of the publicly listed Hyperliquid Strategies, which plans to hold Hyperliquid tokens. "It's great because he can focus entirely on the mission."

Hyperliquid's mission extends far beyond cryptocurrency. It says it hopes to achieve "all finance covered" by allowing people to launch a range of investment products on its blockchain. "The idea is that right now on Hyperliquid, you can really only trade crypto perpetuals, but eventually you might trade public stocks, indices, private companies, commodities, even interest rates," said Alvin Hsia, co-founder of Ventuals, which is developing a way for investors to bet on the valuations of private companies like OpenAI and Anthropic. This, he said, "embodies their vision of becoming the exchange for everything."

For example, another company, Trade.XYZ, recently launched perpetual trading of stock indices on Hyperliquid, allowing traders to use leverage to bet on stock prices without actually holding the shares.

For Yan, Hyperliquid is only successful if it moves away from crypto and reinvents how people interact with finance. "If Hyperliquid fails, I think it's largely because we, as a community, didn't create something truly valuable for the world," Yan said during a panel discussion at a conference in Singapore this month.

This also means Hyperliquid will push regulatory boundaries. Although it operates overseas, Hyperliquid has shown some interest in US crypto policy making. In May, it submitted a letter to the Commodity Futures Trading Commission advocating for the role of decentralized exchanges. The letter was written in response to the agency's request for comment on perpetual-like derivatives.

If Hyperliquid wishes to enter the US market, it could consider acquiring a licensed entity or building one itself, although this would likely require reducing the level of leverage it offers.

Hivemind's Zhang said much of what Hyperliquid does will eventually be permitted in the US. "I think people are still experiencing the hangover from the Biden administration—people haven't really realized how much has changed in the last 10 months," he said.