What is Hyperliquid HLP?

Hyperliquid’s HLP (Hyperliquidity Provider) lets everyday users participate in market making by depositing assets into a shared vault.

TL;DR

You can deposit into the HLP vault to share in market‑making PnL. There’s a 4‑day lock‑up and returns can be positive or negative.

What is HLP?

HLP is a community‑owned market‑making vault. Depositors share the profits (or losses) generated by the vault’s trading activity. There’s no separate management fee — you share the vault’s PnL pro‑rata.

How HLP works

  • Community ownership: market‑making profits are shared by depositors, not just insiders.
  • Pricing strategy: the vault computes a fair price using data from Hyperliquid and major centralized exchanges, then trades around it.
  • On‑chain transparency: positions and trade history are visible on‑chain, even if strategy execution happens off‑chain for speed.

Why it matters

  • It democratizes market‑making gains that are usually reserved for large firms.
  • It gives the community direct exposure to Hyperliquid’s trading activity.
  • It scales as more external market makers join the ecosystem.

How to participate

  1. Deposit assets into the HLP vault.
  2. Wait out the 4‑day lock‑up.
  3. Monitor performance via the on‑chain explorer.

Risks & considerations

  • Market‑making carries real downside risk — returns can be negative.
  • Strategy details are not fully on‑chain, so results may vary.
  • This isn’t fully passive; you should monitor performance over time.

HLP after the JELLY incident

HLP was battle-tested in March 2025 when a coordinated attack used the low-liquidity JELLY market to try to extract value from the vault. Hyperliquid validators voted to delist JELLY and settle positions, which protected HLP depositors but raised a real governance discussion about when validators step in. The takeaway for a beginner: HLP is conservative-by-design but it is not a passive savings account — there are tail-risk scenarios that get resolved through validator action.

For current HLP performance and any active lockup parameters, check app.hyperliquid.xyz/vaults/HLP.