Original Title: How a Harvard grad helped make Hyperliquid the biggest new player in crypto—with just 11 people and no venture funding
Original Authors: Ben Weiss & Leo Schwartz, Fortune
Original Translation: SpecialistXBT, BlockBeats
Editor's Note: In the post-FTX collapse crypto world, the market's thirst for transparency and security has given rise to a new generation of decentralized platforms. Among them, Hyperliquid has emerged as a standout in the competitive derivatives space with its streamlined team of just 11 people and a unique "no venture capital" philosophy, creating a remarkable revenue miracle. This feature article from Fortune delves into how Harvard graduate founder Jeff Yan challenges traditional financial giants with an extreme pursuit of technology, attempting to build the "AWS of finance," while also exploring the regulatory clouds and future challenges facing this emerging giant on its rapid expansion path.
The following is the original content:
Around 5 a.m., a series of urgent alarm sounds woke Jeff Yan. This was a specially set ringtone that only goes off when there is an anomaly at Hyperliquid, the decentralized cryptocurrency exchange he co-founded. And on this morning in early October, the situation was indeed unusual.
According to data from cryptocurrency analysis site CoinGlass, on that day, after U.S. President Donald Trump threatened to impose a new round of tariffs on China, cryptocurrency traders watched as over $19 billion in leveraged positions (bets made by investors borrowing funds to amplify their stakes) evaporated in an instant. "I could only stare at the screen and pray everything was okay," Jeff said about his exchange's system. Within an hour, he mobilized "every brain cell" to analyze the data, ultimately confident that the platform was operating normally—it successfully weathered a stress test during which thousands of traders suffered losses while those shorting the market profited handsomely.
In the following weeks, the cryptocurrency industry referred to the crash on October 10 as a "flash crash." This was the largest liquidation event ever recorded by CoinGlass, and its aftershocks are still reverberating in the industry two months later. It was also one of the most obvious signs that Hyperliquid has grown into a giant in the cryptocurrency space.
CoinGlass data shows that the platform liquidated positions worth over $10 billion that day, far exceeding the liquidation amounts of established exchanges like Bybit ($4.6 billion) and Binance ($2.4 billion). (Note: The $10 billion refers to the total amount of liquidated leveraged positions; the actual amount of money lost by traders is lower than this figure.)
Large exchanges like Binance and Coinbase have thousands of employees. In contrast, Hyperliquid Labs, the parent company supporting the eponymous exchange and blockchain, has only 11 employees. However, according to data from crypto analysis site DefiLlama, in just over two years, Hyperliquid has held its own against industry giants, with a derivatives trading volume of about $140 billion in the past month. This has translated into over $616 million in annualized revenue, and the cryptocurrency associated with its blockchain (called HYPE) has also entered the industry's top ranks, with a market capitalization nearing $5.9 billion.
But Jeff hopes Hyperliquid can achieve even more. "No one else is really trying to build something like this right now," he said, "this is something that can truly upgrade the financial system."
The Prodigies of the Crypto World
The cryptocurrency world has long been filled with flamboyant and outspoken figures. Jeff does not belong to this category. He wears black-rimmed glasses, has neat black hair, and usually dresses in smart shorts, admitting that he feels uncomfortable in the spotlight. "This kind of celebrity treatment is very foreign to me," he said, referring to being surrounded by a crowd at a recent cryptocurrency conference in South Korea. While willing to talk about his background, he repeatedly emphasizes that Hyperliquid is an ecosystem, not a one-man show.
Despite his self-proclaimed humility, it is clear that Jeff is crucial to the rise of this crypto protocol. Born in the Bay Area, he is a typical child prodigy. In high school, he won gold and silver medals at the International Physics Olympiad, then went on to study mathematics and computer science at Harvard University.
"He is always very calm and thoughtful," said Vladimir Novakovski, who also graduated from Harvard and interviewed Jeff for an internship position at wealth management software company Addepar. (Novakovski later founded an exchange called Lighter that competes with Hyperliquid. A spokesperson for Hyperliquid Labs told Fortune that Jeff does not remember being interviewed by Novakovski.)
Around the time Jeff graduated from Harvard, the notorious cryptocurrency scammer Sam Bankman-Fried (SBF) was rising to fame. SBF founded his own crypto trading firm, Alameda Research, while also developing FTX—his exchange specializing in perpetual contract trading. Perpetual contracts are a type of derivative that allows traders to bet on future prices without holding the underlying asset. These contracts allow for leverage, amplifying both profits and losses.
Even as SBF captivated the entire crypto industry with his so-called genius rhetoric, Jeff and his team kept their distance, preferring to trade on platforms like Coinbase. "The relationship between Alameda and FTX was not clear to me," he said, "I felt it wasn't worth the risk to expose any of our funds or strategies to such an unclear relationship."
The Aftermath of FTX
FTX was a black box. SBF poured billions of dollars of customer funds into luxury real estate purchases, high-risk venture capital, and political lobbying. It wasn't until FTX announced bankruptcy that customers discovered how much principal SBF had gambled away.
Jeff wanted to build a more transparent platform for crypto perpetual contracts (or "perps"). He and his team had considered building their own decentralized exchange even before the collapse of FTX, but "the FTX incident solidified my belief that the timing is right now," he said.
He was far from the first founder to conceive of a decentralized trading platform. There are a few platforms like dYdX that provide crypto derivatives for risk-tolerant traders unwilling to venture into centralized exchanges like Coinbase. However, these decentralized platforms are often cumbersome, difficult to use, and slow. "The user experience (UX) of centralized exchanges is very good, and almost all trading volume happens on centralized exchanges, while in DeFi (decentralized finance), I think no one was really trying to reach that level at the time," Jeff said.
However, Jeff himself is a trader, and he and his team decided to build a platform they would be willing to use. "I think it's great when the people building the product are very familiar with who the customers are," said Novakovski, the cryptocurrency founder who interviewed Jeff.
According to a senior cryptocurrency executive who has met both founders, unlike SBF, Jeff's image is more polished, professional, and sincere. "Jeff gets his hair cut, SBF doesn't," said the insider, who requested anonymity, "SBF's shorts are too long and ill-fitting. Jeff looks sharp and tidy."
Unlike SBF and countless other cryptocurrency founders, Jeff and his team decided to reject funding from venture capitalists. They had already earned substantial revenue from their cryptocurrency trading business, and Jeff decided to cover the costs out of his own pocket. "If we want to build a truly trustworthy neutral platform for everyone to build applications on, then a very important principle is to not have 'insiders,'" he said.
In 2023, Jeff and his team launched Hyperliquid and the blockchain it is built on. According to DefiLlama data, trading volume has steadily increased for months, but by early 2025, interest in the exchange exploded.
Hyperliquid is optimized for speed. For many traders, a few seconds of latency can mean the difference between profit and loss. "I'm the one who always pesters the team to add more features, but they keep rejecting every feature I ask for because they want to maintain the platform's speed and extreme flexibility," said Thanos Alpha, an anonymous Hyperliquid user who claims to be a heavy user of the platform.
This anonymous trader, who declined to reveal his real name, added that this speed, combined with engineering solutions that allow Hyperliquid to accommodate larger trades than its competitors, laid the foundation for its success. He described himself as a loyal user of DeFi but refused to disclose his real name—this is also a common request among die-hard cryptocurrency fans.
Now, the ecosystem is attracting interest beyond anonymous cryptocurrency traders. According to The Information, large venture capital firms like Paradigm and Andreessen Horowitz (a16z) have taken positions in Hyperliquid's HYPE tokens. Even Wall Street and large corporations are starting to pay attention. Fintech giant PayPal has posted about Hyperliquid on social media, while a number of companies are racing to launch Hyperliquid-branded stablecoins on the blockchain. David Schamis, founding partner of private equity firm Atlas Merchant Capital, is managing a publicly traded company that is hoarding HYPE. "It's not just about trading cryptocurrencies," Schamis said when discussing blockchain technology.
The AWS of Finance
Jeff himself views Hyperliquid as the Amazon Web Services (AWS) of financial infrastructure, the cloud computing giant that supports much of the internet's operations. Developers are independently deploying different assets for trading on the blockchain beyond cryptocurrencies, including publicly listed products tied to the stock prices of major companies like Nvidia and Google. Meanwhile, some validators (those who own the servers that actually process transactions) earn income by supporting the ecosystem.
However, there is no guarantee that Hyperliquid will continue to expand, especially as competitors are trying to challenge Hyperliquid's newly established dominance. This includes Novakovski, who later launched Lighter—a competitive crypto derivatives platform supported by Founders Fund, Ribbit Capital, David Sacks' Craft Ventures, and a16z crypto. There is also Aster, a Hyperliquid imitator closely associated with the crypto exchange Binance.
Moreover, like many crypto projects in the DeFi world, Hyperliquid operates in a murky legal space. Its users are all anonymous and do not need to submit documents to verify their identities, unlike traders accessing more traditional financial products like Robinhood. Taylor Monahan, chief security researcher at the crypto wallet MetaMask, pointed out that, in fact, users linked to North Korea, which is notorious for its crypto hacking operations, have traded on Hyperliquid. According to crypto analytics firm Chainalysis, DeFi protocols are part of North Korea's money laundering operations.
A spokesperson for Hyperliquid Labs stated that Hyperliquid's website conducts risk behavior screening for traders and enforces sanctions compliance measures, adding that "any confirmed high-risk activity on the application will be immediately flagged, and related addresses will be blocked."
Furthermore, if Hyperliquid continues to grow, the ecosystem may attract more regulatory scrutiny. "A big question is how long they (Hyperliquid) can continue to operate without KYC," said a cryptocurrency market maker. KYC laws require financial institutions to collect user identity information. This market maker requested anonymity to speak more candidly.
"The bigger you get, the more serious this issue typically becomes," the market maker added.
"We are actively engaging with regulators and policy stakeholders to support decentralized finance in achieving greater clarity," a Hyperliquid spokesperson stated in response.
As Hyperliquid navigates the evolving competitive landscape and regulatory environment while striving to realize Jeff's ambition of reshaping financial infrastructure, this DeFi founder may continue to expand his team. This is also why he announced in late October that he would be hiring and increasing the number of Hyperliquid Labs employees by nearly 30%—from 11 to 14.
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