Hyperliquid Unveils ‘HIP-4’ for Prediction Markets, HYPE Price Surges

Hyperliquid has announced plans to launch ‘HIP-4,’ a protocol that will enable prediction markets on the decentralized exchange (DEX). The HYPE price climbed on the back of this development, recording double-digit gains despite the current market downtrend.

Hyperliquid Announces HIP-4 Protocol For Outcomes Market

In an X post, the decentralized exchange (DEX) announced that HyperCore will support outcome trading, which is what the HIP-4 protocol will entail. These outcomes are fully collateralized contracts that settle within a fixed range.

Hyperliquid noted that the outcomes contracts will be useful for applications such as prediction markets and bounded options-like instruments. This move follows the release of the HIP-3 protocol on the DEX, which enables users to create custom perpetuals markets by simply staking their HYPE tokens. As CoinGape recently reported, HIP-3’s open interest reached new all-time highs (ATHs) amid the demand for commodities and stocks on the DEX.

Hyperliquid is now looking to tap into the prediction markets industry with the launch of HIP-4, a move that could see top crypto prediction markets launch on the DEX. Further explaining how these outcomes trading will work, the DEX noted that they “bring non-linearity, dated contracts, and an alternative form of derivative trading that does not involve leverage or liquidations.”

The exchange added that “the outcome primitive expands the expressivity of HyperCore, while composing with other primitives such as portfolio margin and the HyperEVM.” Outcomes are still a work in progress and are only on the testnet. The team plans to deploy Canonical markets using objective settlement sources once technical development is complete.

Hyperliquid also plans to represent these Canonical markets in USDH, its native stablecoin. Meanwhile, pending user feedback, there are plans to extend to permissionless deployment.

HYPE Price Records Double-Digit Gains

The HYPE surged over 10% following Hyperliquid’s announcement of the HIP-4 protocol. The token climbed from a low of around $30 and is not trading above $32, up over 12% in the last 24 hours. Notably, the token is also up over 40% in the last seven days despite the recent crypto market crash.

Crypto commentator Yaugourt noted that this move would increase Hyperliquid’s adoption, as the DEX will serve both users who want to use leverage and those who do not. Meanwhile, crypto analyst Shaunda Devens noted that this move further supports a higher valuation for the DEX.

He noted that even if HIP-4 captured 100% of Polymarket’s volume, it would add just about 5% to Hyperliquid’s revenue. Decens said this likely highlights that the scale of perp markets (including HIP-3) is massive and that the DEX is undervalued at $7 billion, compared with Polymarket, which is valued at $10 billion based on its recent funding round.