alt.fun is a token launchpad on HyperEVM with a twist: every token is paired with a tokenized Hyperliquid perpetual futures position instead of a normal spot asset like HYPE or USDC. In plain English, an alt.fun token can move for two reasons: people buying or selling the token, and the leveraged movement of the market it is backed by.
This beginner guide explains what alt.fun is, how the bonding curve works, what “backed by perps” means, and what new users should check before buying or creating a token.
Beginner takeaway: alt.fun tokens are not simple meme coins. They behave like meme coins plus embedded leveraged exposure to another market. That can create upside in a trend, but it also adds risks like volatility decay, curve regression, thin liquidity, and failed sell transactions.
What is alt.fun?
alt.fun is a launchpad for creating and trading tokens on HyperEVM, the EVM-compatible smart contract environment connected to the Hyperliquid ecosystem. Instead of pairing new tokens with a standard spot asset, alt.fun pairs every token with a tokenized Hyperliquid perp, also called a leveraged token or LT.
When someone creates a token, they choose the underlying asset, the direction, and the leverage. For example, a token might be backed by HYPE 3x Long, BTC 2x Short, ETH 5x Long, or another supported market.
- Underlying asset: the market being tracked, such as HYPE, BTC, ETH, SOL, or PAXG.
- Direction: long if the token should benefit when the underlying goes up, or short if it should benefit when the underlying goes down.
- Leverage: 2x, 3x, or 5x exposure.
How alt.fun works in simple terms
Most launchpads use a bonding curve where people buy a new token with a quote asset like ETH, SOL, HYPE, or USDC. On alt.fun, the quote asset inside the curve is different: it is a tokenized perp created through BounceTech and backed by a Hyperliquid perp.
Here is the simplified buy flow:
- You buy an alt.fun token using USDC.
- alt.fun routes that USDC through BounceTech to mint the appropriate leveraged token.
- That leveraged token enters the bonding curve.
- You receive the alt.fun token.
Selling works in reverse: your token is swapped back into the underlying leveraged token, the leveraged token is redeemed for USDC, and you receive USDC after fees and slippage.
Why can an alt.fun token move when nobody buys?
This is the most important concept for beginners. An alt.fun token’s curve value can change even if no one is actively trading the token.
Imagine a token backed by HYPE 3x Long. If HYPE rises 10%, the HYPE 3x Long leveraged token may rise roughly 30%, before fees, slippage, and rebalancing effects. Because that leveraged token is the reserve asset inside the curve, the alt.fun token’s curve value can increase too.
The reverse is also true. If HYPE moves against that 3x long position, the backing asset loses value and the token’s curve can fall even if nobody sells. alt.fun’s docs call this curve regression: the curve’s USDC value can go backward when the leveraged token depreciates.
What are leveraged tokens?
The leveraged tokens used by alt.fun are non-liquidating tokenized perps issued through BounceTech. They aim to maintain a target leverage level by automatically rebalancing the underlying perp position.
That design has a beginner-friendly benefit: you cannot lose more than you put in, and you do not personally manage margin or liquidation levels. But it also creates a tradeoff. Rebalancing can cause volatility decay, especially when the market chops sideways. A 5x token may benefit more from a clean trend, but it can decay faster in noisy conditions than a 2x token.
Creating a token on alt.fun
Anyone can create a token on alt.fun. Creators provide the name, ticker, image, description, optional social links, and the underlying asset, direction, and leverage combination.
- Total supply: 1,000,000,000 tokens.
- Bonding curve allocation: 75% of supply enters the bonding curve at launch.
- Post-graduation LP reserve: 25% of supply is reserved for the liquidity pool after graduation.
- Minimum creator buy: creators must make an initial buy of at least $20.
- Metadata: token metadata cannot be edited after launch.
- Creator fees: the creator address is set at launch and receives a share of trading fees.
Buying and selling on alt.fun
Trades in the alt.fun interface use USDC. The protocol handles minting, swapping, and redeeming the underlying leveraged token in the background.
- Minimum buy: $20.
- Minimum sell: $12.
- Default slippage: 10%, adjustable in the UI.
- Gas: you need a small amount of HYPE for gas on HyperEVM.
Before confirming a trade, check the expected price, fees, slippage tolerance, and final amount received. For larger sells, be extra careful: alt.fun notes that large sells may be non-atomic and can revert. Larger holders may need to use the AMM pool and BounceTech redemption flow directly.
What is graduation?
An alt.fun token “graduates” when it leaves the bonding curve and begins trading in a standard AMM pool on HyperSwap V2. Graduation happens automatically when either all tokens on the bonding curve are sold, or the bonding curve holds $9,000 worth of leveraged tokens.
Because that $9,000 threshold is based on the current USDC value of the leveraged token backing the curve, graduation can happen from buys, from the underlying asset moving in the token’s favor, or from both. It can also get further away if the underlying moves against the token.
Fees beginners should understand
alt.fun charges a 0.75% swap fee on pre-graduation bonding curve buys and sells. According to the docs, that fee is split as 0.5% to the protocol and 0.25% to the token creator.
There may also be external costs. BounceTech charges a redemption fee when leveraged tokens are redeemed for USDC, Hyperliquid trading fees are realized by the underlying perp, and post-graduation swaps use HyperSwap’s pool fee structure.
Beginner checklist before buying an alt.fun token
- Check the underlying: Is the token long or short? Which asset does it track?
- Check leverage: 5x is much more aggressive than 2x.
- Check the curve: Is it close to graduation, or can it regress if the underlying moves against it?
- Check holders and early wallets: New curve tokens can be dominated by creators, snipers, or bots.
- Check slippage: Thin liquidity can make entries and exits expensive.
- Plan the exit: Understand that large sells can revert and may require a more advanced route.
- Size small: Treat these as high-risk, experimental DeFi assets.
Main risks of alt.fun
- Market risk: the underlying perp can move against the token’s direction.
- Volatility decay: sideways chop can reduce leveraged token value over time.
- Curve regression: the bonding curve’s value can fall even without token sells.
- Liquidity risk: small pools can create high slippage.
- Execution risk: large sells may revert or require a manual LT redemption path.
- Protocol risk: alt.fun depends on external protocols including BounceTech, Hyperliquid, and HyperSwap.
Final thoughts
alt.fun changes the launchpad formula. Instead of a token only moving when people buy or sell it, each token is tied to a leveraged view on another market. That makes the product more dynamic, but also more complex.
For beginners, the safest mental model is this: an alt.fun token is a new token plus a leveraged market bet. Before buying, know the underlying asset, direction, leverage, fees, graduation status, holder distribution, and exit path. If you cannot explain those in one sentence, slow down and do more homework first.
This guide is for educational purposes only and is not financial advice.