Hyperliquid’s Open Interest Leadership Faces 2026 Challenge From Zero-Fee Rivals

TLDR:

• Hyperliquid controls one-third of trading flow through builder codes but faces zero-fee competition
• Traditional builder economics force integrators to charge 4bps when protocols mandate 3bps baseline fees
• Paradex and Lighter launch revenue-sharing models allowing builders to bypass mandatory fee structures
• Polymarket assigns 28% probability to Hyperliquid losing OI leadership position during 2026 calendar year 

Hyperliquid currently maintains the highest open interest among perpetual decentralized exchanges, yet mounting competitive pressures suggest this position may face challenges. 

A Polymarket prediction market currently prices the probability of Hyperliquid losing its OI leadership at 28 percent. 

The platform generates superior revenues and total value locked compared to competitors. However, emerging distribution strategies from rival protocols could reshape the competitive landscape throughout 2026.

Builder Code Economics Threaten Market Share

Hyperliquid derives approximately one-third of its trading flow from third-party builders utilizing builder codes. These partnerships connect the protocol with external wallets and trading interfaces. 

The current builder code structure imposes mandatory baseline fees that create friction for external integrators.

Protocols typically enforce minimum fee requirements that constrain builder flexibility. When Hyperliquid mandates three basis points but a builder prefers charging users one basis point, the total cost reaches four basis points. 

This arrangement limits competitive pricing strategies and discourages experimentation with fee structures.

Competing platforms now offer zero-fee builder codes paired with revenue sharing models. Paradex and Lighter have launched these alternative arrangements. 

This approach allows builders to capture flow without passing mandatory fees to end users. The economic incentives could redirect significant volumes away from Hyperliquid’s current distribution channels.

Airdrop Farming Dynamics Reshape Market Structure

Perpetual DEX airdrop farming has emerged as a significant force affecting market dynamics. Hyperliquid’s dominance across volume, TVL, and open interest metrics has declined from previous peaks. The protocol maintains strong volume-to-OI ratios despite these shifts.

Infrastructure commoditization continues across the perpetual exchange sector. As technical capabilities converge among platforms, distribution networks become increasingly important. 

Protocols offering superior economics to builders gain advantages in securing prominent placement within wallets and aggregators.

Platforms such as Aster and Variational continue development efforts targeting market share gains. These competitors actively incentivize open interest accumulation through various mechanisms. 

Data limitations prevent precise measurement of how builder code traffic translates into sustained OI contributions. Nevertheless, traders maintaining positions across multiple platforms likely contribute to aggregate open interest figures.

The 28 percent probability assigned by prediction markets reflects meaningful uncertainty about 2026 outcomes. While Hyperliquid maintains current leadership across key metrics, structural changes in builder economics present tangible risks. 

Token holders with substantial HYPE exposure might consider the prediction market as a hedging mechanism. The competitive environment will likely intensify as zero-fee builder programs scale and newer protocols mature their offerings.