Open interest (OI) on Hyperliquid's HIP-3 markets hit a record high of $2.38 billion last week. As of Wednesday, OI sits at slightly under $2.1 billion, still near its highs despite a 12% pullback likely tied to broader risk-off moves.

HIP-3's growth trajectory has been staggering, from just around $280 million in OI at the beginning of the year to crossing $1 billion less than a month later and $2 billion by the end of the quarter. Year-to-date, HIP-3 OI is up approximately 580%. TradeXYZ alone accounts for over 90% of all HIP-3 OI.

On the Hyperliquid platform itself, only three of the top 10 markets by volume are crypto pairs. The rest are tokenized equity and commodity futures such as Nasdaq proxies, oil, gold, silver, and the S&P 500.

Traders are increasingly seeking exposure to equities and commodities outside traditional market hours, and HIP-3 provides that without intermediaries and with crypto-native settlement.

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Existing tradfi incumbents such as CME, ICE, and Eurex don't offer 24/7 equity futures, while Robinhood and Interactive Brokers don't settle on-chain.

The $5 billion OI mark is where things get interesting for HIP-3. At that level, HIP-3 starts generating enough volume and liquidity to attract market makers who currently operate on CME and CBOE.

Moreover, there's a good possibility that HIP-3 expands beyond perps into spot tokenized equities, which would represent a much more direct challenge to traditional stock exchanges and would also almost certainly accelerate regulatory response.

This is an excerpt from The Block's Data & Insights newsletter. Dig into the numbers making up the industry's most thought-provoking trends.