Hyperliquid's Rise Fuels Arbitrum Liquidity Surge: An In-Depth Analysis

Hyperliquid's Ascent and Its Role in Boosting Arbitrum's Liquidity

Recently, the Hyperliquid HIP3 protocol has gained immense popularity, enabling the trading of a wide array of assets such as stock perps, gold perps, and even Pokémon cards and CS skins. While Hyperliquid has captured much of the spotlight, the significant surge in liquidity that Arbitrum has experienced often goes unnoticed. But, could Arbitrum be the real 'silent winner' of Hyperliquid's success?

Structural Dependence on Arbitrum

Hyperliquid heavily relies on Arbitrum for its USDC supply. When a TSLA stock perp or a gold perp is launched on Hyperliquid, it triggers a massive influx of USDC from Arbitrum. This isn't a mere coincidental relationship; it's a structural dependence. These bridging activities directly contribute to Arbitrum's daily trading volume and ecosystem activity, further solidifying its position as the leading Layer-2 solution.

Why Arbitrum, Not Others?

Some might argue that Arbitrum is simply a transit point for funds heading to Hyperliquid. However, the question arises: why did Hyperliquid choose Arbitrum over Solana or Base? There are several key reasons:

1. Lowest Technical Adaptation Cost: Hyperliquid requires an EVM-compatible liquidity entry point to securely receive stablecoins. Arbitrum's Nitro architecture allows bridge latency to be controlled within one minute, and with gas fees of less than $0.01, the friction cost is almost negligible for users.
2. Unrivaled Liquidity Depth: Arbitrum's native USDC circulation reaches $8.06 billion, the highest among all Layer-2 solutions. Furthermore, Arbitrum has developed mature protocols like GMX and Gains that form a complete loop of lending, trading, derivatives, and yield aggregation. Hyperliquid's choice of Arbitrum is more than just choosing a bridging channel; it's choosing a mature liquidity network.
3. Irreplicable Ecosystem Synergies: Many of the newly launched stock perps and gold perps on HIP3 already exist as RWA assets on Arbitrum, with lending and farming facilitated through DeFi protocols like Morpho, Pendle, and Euler. This allows users to stake RWA assets as collateral on Arbitrum, borrow USDC, and then bridge it to Hyperliquid to open stock perp trades with 5x or even 10x leverage.

A Strategic Complementary Relationship

The relationship between Hyperliquid and Arbitrum is far from a simple parasitic one. Hyperliquid, as a Perp Dex application chain, constantly stimulates trading activity, while Arbitrum provides continuous liquidity infusion. Arbitrum needs prominent applications like Hyperliquid to address the shortcomings in the Ethereum ecosystem in terms of product strength. This is reminiscent of when Arbitrum introduced the Orbit layer3 framework, emphasizing "general-purpose layer2 + specialized application chain." Orbit allows any team to quickly deploy their own Layer3 application chain, enjoying Arbitrum's security and liquidity, and customizing performance parameters based on business needs.

Is Hyperliquid a Layer3 in Disguise?

While Hyperliquid chose the path of building its own Layer-1 + deep integration with Arbitrum, it's not exactly the same as directly deploying a Layer-3. However, a careful analysis of the relationship between the HIP-3 ecosystem and Arbitrum reveals an interesting conclusion: HIP3 has somewhat become Arbitrum's de facto Layer3 application chain. After all, the core logic of so-called Layer3 is to outsource security and liquidity to Layer2 while maintaining its own performance advantages. Clearly, Hyperliquid cannot provide the liquidity advantages for the HIP3 ecosystem at the moment, but Arbitrum can. Isn't this a variant of the layer3 operation model?