Hyperliquid has formally introduced HyperEVM on the mainnet today to deliver general-purpose programmability to its high-performance financial system. The EVM is designed to effortlessly include Ethereum-compatible smart contracts and improve efficiency as a basic component of Hyperliquid’s Layer 1 blockchain architecture.
How Does Hyperliquid EVM Work?
Rather than creating independent EVM-compatible chains, HyperEVM shares its state and consensus with Hyperliquid L1, which is powered by the HyperBFT consensus mechanism.
It enables a developer and user environment that combines the best of decentralized finance (DeFi) with the performance typically associated with centralized exchanges. This is possible by allowing smart contracts to interact natively with Hyperliquid’s infrastructure, including advanced spot and perpetual order books.
There are three main components in the release:
- Blocks built as part of Layer 1 execution and inherit all security features from HyperBFT consensus
- Spot transfers between native spot HYPE and HyperEVM HYPE are now available with HYPE as the native gas token
- A canonical WHYPE system contract is deployed to support DeFi applications on the platform
One of the most outstanding features of HyperEVM is its potential for high-performance trading, driven by block confirmation times under one second and a median transaction latency of just 0.2 seconds.
This makes it ideal for high-frequency trading and complex DeFi applications that consider execution speed a top priority.
What HyperEVM Means for Liquidity and Trading
The platform aims to increase liquidity by integrating HyperEVM with Hyperliquid’s order books. This may lead to more efficient swaps, better collateral utilization, and smoother trading experiences.
Separate chain architectures will no longer hinder developers from creating DeFi applications. By leveraging Hyperliquid’s unique trading infrastructure, lending protocols can utilize order book liquidity, and new derivative products can emerge.
Finally, combining the speed and usability of centralized exchanges with the security and transparency of blockchain technology may attract users who value both convenience and control over their assets.
Nonetheless, the platform has several issues to solve for the success of its EVM. These include decentralization issues and security and stability concerns regarding the tooling and analytics.
Developers exploring the opportunities on this new platform might drive new DeFi apps, challenging the limits of on-chain banking.
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