Raised, priced, marketed: HIP-6 wants Hyperliquid to be the first choice for the money. Land

By James Evans (@jimbo evans)

: Deep tide TechFlow

Introduction:This is a complete Hyperliquid improvement proposal to introduce a continuous clearing competition at the level of the agreement that would allow new currency projecters to complete the full process of capital mobilization and liquidity start-up on the chain without relying on a centralized exchange or third-party platform。

The author drew on the Uniswap ' s continuous liquidation competition model and re-engineered the order book environment for Hyperliquid. The technical details of the proposal were extremely complete and covered every link from configuration to settlement to security considerations。

The text reads as follows:

@fiegemax provides ideas, guidance and feedback, and thanks @arnx813, @0xBroze, @0xOmnia, @xenoflux, @happenwah, @const hom and @DougieDeLuca for their reviews and comments。

Disclosure: I hold $HYPE in my personal account. I work for @recvcx, but this is only a personal opinion, not a position of Recipal Ventures。

Summary

HIP-6 introduced a licensing mechanism for the issuance of tokens for HIP-1 assets, specifically designed for the original distribution of coins on @HyperliquidX. The mechanism adapts @Uniswap’s consecutive clearing competition (CA) to the original order book (CLOB) environment of Hyperliquid. At the time of the competitive registration, the project party selects a quoted asset (e.g. USDH) from the matching assets approved in the agreement, creating new sources of demand and usefulness for these assets. The proceeds of the auction are owned by the project, and a portion of the configuration will automatically inject liquidity into the HIP-2 through the trade-weighted average of the end of the auction window. All competing logic operates within the HyperCore block conversion without external operator。

Motive

HIP-1 and HIP-2 support the deployment and automated mobility of non-licensed tokens, but found insufficient support for capital formation and prices of new tokens. @HyperliquidX's original coin distribution team is still, to a large extent, forced to raise funds under the chain, manually inject HIP-2 with their own funds, and/or online in a thin order book. Because of these frictions, Hyperliquid has not yet matched its capabilities with other high-performance ecosystems and exchanges. @solana has @metadao, @base has @Uniswap Liquidity Launchpad and @dopplerprotocol, @coinbase has @echodotxyz. HIP-6 is optional, but by achieving more efficient capital formation and prices, the HIP-6 supports the founders who want to complete the project life cycle on Hyperliquid and promotes the goal of Hyperliquid becoming a block chain for all finance。

HIP-6 Improvements Hyperliquid:

Chain-based capital formation: Teams can raise original funds on Hyperliquid in a single process, with benefits distributed between project parties and the automatic injection of HIP-2 liquidity。

Fair price discovery: successive liquidation competitions find market prices in multiple blocks, minimizing the impact of time games that are common in traditional competitions。

THE INCREASE IN MATCHING QUOTED ASSETS: TO CREATE PRACTICALITY FOR MATCHING QUOTED ASSETS, THEREBY INCREASING THEIR TVL AND GENERATING REVENUE FOR THE ASSISTANCE FUND。

Attracting builders: Teams can complete the full life cycle of tokens on Hyperliquid. The distribution of more coins on Hyperliquid means that the Aid Fund has more transaction costs。

Participants ' protection: committed funds are held in HyperCore status during the competition, not in the trust of the project party or by a trusted third party。

FOR NAMING: THIS PROPOSAL IS HIP-6 BECAUSE HIP-5 WAS PREVIOUSLY ASSIGNED TO ANOTHER STAND-ALONE PROPOSAL。

What are we building on

HIP-6 matches the continuous liquidation of @Uniswap with the original CLOB environment of Hyperliquid. CA decomposes a large race into a small one of N's mutually progressive. Each block, the agreement releases a pool of coins and calculates the flat settlement price. Price discovery takes place gradually, not at a single moment, and bidders are encouraged to participate earlier than they wait。

There are obvious shortcomings in the various alternatives:

Fixed-price sales: Prices found to have a poor effect because someone had to guess the correct price at the opening. When prices are low, the project loses the difference; when prices are high, sales fail。

A ceiling pro rata sales: values leaks were repaired but oversubscribe spirals were created. In practice, if sales are oversubscribed twice, rational participants are placed in a target quota of two times, making them more oversubscribed. It's a bad user experience。

NO-CEILING SALES: SPIRALS WERE AVOIDED, BUT THEY LED TO EXCESSIVE FUND-RAISING. A PROJECT THAT COULD BE BUILT WITH 5 MILLION DOLLARS RAISED 50 MILLION BECAUSE NOTHING STOPPED IT. THE ICO WAVE IN 2017 SHOWED THE CONSEQUENCES OF THIS WAY。

Traditional competition: Let the market find prices but make time games. The best strategy is to wait as long as possible. This has created a worse user experience for non-institutional participants。

Dynamic conic: Combining Dutch auctions with demand-responsive conics. This works well in the AMM primary environment but is not suitable for the primary CLOB environment of Hyperliquid。

WHAT TO BUILD ON HIP-6

HIP-6 addresses capital formation and price discovery: how new projects raise funds and inject liquidity on Hyperliquid. It does not involve mechanisms for the accumulation of the value of specific tokens, protection measures for token holders or the governance of specific projects. These are independent issues, and we expect the team to be built on HIP-6。

EXAMPLES OF FUTURE PROJECTS THAT CAN BE BUILT ON HIP-6:

Accumulation mechanism: Provides for how the agreed income flows back to currency holders (e.g., fee allocation, repurchase, pledge incentive)。

Governance framework: gives currency holders the right to vote on treasury allocations, changes in parameters and/or upgrading of agreements。

(b) Coin Holder Protection: Tools such as treasury locking, chain reporting requirements and/or attribution mechanisms are provided, and buyers and team quotas are targeted。

The goal of HIP-6 is to make the initial competition as fair and efficient as possible. What happens after the competition is the design space of the Hyperliquid community. HIP-6 does not prevent teams from working with market vendors to enhance the mobility of their project order book。

Open Draft Document

The following is a draft of how the HIP-6 will appear in the Hyperliquid public document. It is included here to allow reviewers to preview user-oriented descriptions。

HIP-6: CURRENCY ISSUANCE COMPETITION

HIP-6 Introduction of non-licensed coins for HIP-1 assets. The projector competes for a portion of its coin supply through successive liquidations. The bidders committed funds by matching the quoted assets (currently USDH). The bidders specify their total budget and the maximum price each currency is willing to pay. The bid was then spread among the remaining blocks of the competition. Each block that competes, the agreement releases the token at a fixed rate. The agreement then matched the supply of released coins to the needs of the bidders and found uniform clearing prices for each block. At the time of settlement, the costs of the agreement are sent to the Assistance Fund, and a portion of the proceeds is automatically injected into liquidity at the price found in the final window of the competition, with the remainder attributed to the project. All competing logic runs within the HyperCore block conversion。

Let's deploy the competition

Once the standard HIP-1 deployment steps (register Token2, userGenesis (if any), gensis and registerSpot) have been completed, the projecter calls registeraction. The projecter specifies the following parameters:

audienceSupply: Total currency sold. Transferred from the spot account of the project party to the protocol hosting at the time of registration。

duration: the maximum of 3,024,000 (approximately 1 week under 0.2 seconds/block) is the length of the competition in blocks。

floorPx: Minimum liquidated price, default 0。

start Delay: The number of blocks registered between the first clearing block is a minimum of 1 and the default is 1。

minRaise: Minimum bid asset collection required for successful bidding, default 0。

quoteAsset: Must be an agreed matching quoted asset (e.g. USDH)。

hip2Seed: Net proceeds (after deduction of protocol costs) automatically injected the base point number of HIP-2. Range 2,000 to 10,000, default 2,000。

hip2OrderSz and hip2NOrders: the size and number of HIP-2 orders must be filled。

All parameters are irrevocable once registered. The transfer of each token is frozen at the time of registration, preventing all spot orders, transfers and HyperEVM operations in respect of that token from being activated until settlement. The projector can cancel the competition by canceraction before the startBlock (i.e. during the startDelay period)。

bid

The bidders call submitBid, specify the budget (a minimum of 100 units of quoted assets) and maxPx (the maximum price of each currency, which is taken down to the competitive tic grid). The budget is hosted at the time of submission. The non-refundable cost of one quoted asset is charged at each bid. The budget is distributed equally among the remaining competition blocks. The bids submitted in block h start effective participation in liquidation from block h+1. The bids submitted during startDelay are activated in the first clearing block。

The bidders can submit multiple bids with different highest prices to express the demand curve, but each bid has a maximum of 100,000 bids. Only when the maxPx bid is strictly lower than the most recent settlement price may the bidder withdraw the bid。

Liquidation

For each block during the competition, the agreement is to release the token at a fixed rate (action Supplement/duration per block) and to calculate the flat settlement price by measuring the already occupied price from the highest to the lowest until cumulative demand meets supply. Offers above the liquidated price receive a full quota. The remaining portion is shared at the clearing price at the rate of the budget per block. Prices below liquidation prices are not available. The bid price grid uses the geometric tic spacing of 1.003, consistent with the HIP-2。

SETTLEMENT, HIP-2 ACTIVATED AND CLAIMED

The first block at the end of the competition failed if a min Raisee was set but not reached. All matching quoted assets were returned, all coins were returned to the project party and the freeze was lifted. If totalQuoteSpent is zero, no matter what minRaise, the competition fails。

When successful, the protocol is atomic:

500 bp protocol fees are deducted from the total cost quoted and sent to the assistance fund。

Distribute hip2Seed for HIP-2 activation。

Transfer the remainder to the projecter's wallet。

Return unsold tokens to the project。

UNFREEZING OF TOKENS, RECOVERY OF SPOT TRANSACTIONS, TRANSFERS AND EVM OPERATIONS。

Activate HIP-2, using hip2OrderSz and hip2NOrders as specified by the project. Hip2Seed is used for injections of Neded Levels. The starting price is seedPx, calculated by a weighted average of trades of the last 5% of the duration of the competition。

Upon completion of the settlement, the bidder acknowledges the purchase of tokens and unused quoted assets through claimaction。

Costs

10 HYPE registration fees charged on registeraction. Each time submitBid charged the cost of one quoted asset. The total proceeds are charged at the time of settlement with 500 bp protocol fees. All costs go to the Assistance Fund. The existing set Deprooyer Trading Fee Share of the project is normally applicable to post-competitive spot transactions。

What are we building on

HIP-6 Hy-CO is a continuous clearing competition embedded in the HyperCore block conversion logic. Bids are submitted by bidders with matching quoted assets (e.g. USDH), with each bid specifying the budget and the maximum price. For each block, the agreement releases a consignment of coins and calculates the flat settlement price for the block. A bidder whose maximum price is strictly above the liquidation price receives a full quota; a bidder who happens to be at the liquidation price receives the remainder, which may be part of the deal. At the end of the competition, the agreed fee is sent to the Assistance Fund, where the remaining share of the available share of the proceeds is injected into the HIP-2 Hyperliquidity at the value weighted by the final window of the auction, and the remainder to the projecter ' s wallet. The settlement at the end of the race is atomic。

Hy-CO Life Cycle

Hy-CO has three phases:

Before the competition: Configuration. Once the standard HIP-1 deployment step has been completed, the project party calls registeraction. Agreement verification parameters, hosting token supply and seller supply, activation of token freezing and allocation of competition ID。

In competition: bid. The bidders can submit their bids through submitBid during the start-up Delay or at any point in the process. The budget is hosted at the time of submission, regardless of when bids are submitted. Liquidation. Each block, starting with the start Block, during the competition, was agreed to release the token and calculate the flat settlement price。

After competition: settlement. In the first block after endBlock, the agreement assesses the success of the competition and distributes the proceeds. HIP-2 activated. After a successful settlement, the HIP-2 automatically activates with the idPx and the order parameters specified by the project. Claim. Upon settlement, the bidder acknowledges the purchase of tokens and unused quoted assets through the claimaction. Regular transactions may be made during the period of identification。

Cancel: cancellaction can be executed at any time before startBlock. It returns to the project, lifts the freeze and releases the contest slot. If the bid is submitted during the start Delay, the competition goes down the path of failure: the bidder recovers the quoted assets (the same withdrawal path as the failed bid) from the trustee through the claimAction. ActionRegationFee is not refundable. When liquidation begins, the competition is irrevocable。

Key design decisions

Why a new HIP rather than a third-party product: token issuance is an infrastructure, not an application. If each team builds its own distribution mechanism, the ecosystem is fragmented. HIP means that every token issued on Hyperliquid (e.g. opting to use HIP-6) receives the same fair price discovery and automatic HIP-2 injection without external dependence. This also means that the mechanism is secured by a consensus of the certifying officer and not by a third party。

Why choose HyperCore instead of HyperEVM:HIP-6 needs everything that exists on HyperCore. Construction on HyperEVM introduces unnecessary complexity and reduces user experience by adding steps and delays。

WHY OPT FOR CONSECUTIVE LIQUIDATION COMPETITIONS: TRADITIONAL COMPETITIONS FOR INCENTIVE RATES RATHER THAN TIME GAMES FOR VALUATION; JOINT CURVES DEPEND ON PATHS; FIXED PRICE SALES NEED TO GUESS THE RIGHT PRICE. THE CCA SPREADS BIDS OVER TIME, SETTLES EACH BLOCK AT A UNIFORM PRICE AND CONSTRICTS WITHIN THOUSANDS OF BLOCKS, RATHER THAN AT A SINGLE MOMENT。

WHY IS ALIGNMENT ONLY PERMITTED: BID AGAINST MATCHING QUOTED ASSETS (CURRENTLY USDH). EACH COMPETITION LOCKS UP THE QUOTED ASSETS, INCREASES TVL AND GENERATES BENEFITS FOR THE ECOSYSTEM DURING ITS DURATION. NON-RECIPROCAL ASSETS SUCH AS USDC ARE SUPPORTED BY THE MARGINAL APPLICATION OF PROCEEDS TO DILUTE THIS EFFECT. CANDIDATES HOLDING USDC CAN SWITCH THROUGH THE STANDARD INTERFACE。

WHY ONLY LINEAR RELEASE PLANS ARE FORESEEN: LINEAR TO ENSURE THAT THE CLEARING ORDER IS NOT REDUCED, WHICH ACHIEVES EFFICIENT BILLING THROUGH CUMULATIVE CHECKPOINTS. NON-LINEAR SCHEMES (POST-WEIGHTED, PRE-WEIGHTED) MAY RESULT IN LIQUIDATION PRICES FALLING WHEN THE SUPPLY PER BLOCK JUMPS, COMPLICATING THE RECORDING OF BIDS. THESE MAY BE INTRODUCED IN FUTURE HIPS, PROVIDED THAT THE BILLING PROGRAM IS EXTENDED。

Security considerations

The project party deals in its own right: the project party can bid in its own bid through a separate wallet to exaggerate the liquidation price and VWAP and then recover the unsold token after settlement. Mitigation measures include: agreement costs for self-trading in all self-trading volumes; seedPx counts in the VWAP window covering the last 5 per cent of the competition, which requires ongoing expenditure to be manipulated; min Raise leads to competition failure when real demand is insufficient; and all bids are visible on the chain, making self-trading detectable. Quantitatively, one project operator runs 1 million USDH competitions (protocolFee = 500, hip2Seed = 2000) for 400,000 USDHs (40 per cent of the total): approximately 20,000 USDHs were lost to the Assistance Fund (5 per cent agreement cost, not recoverable), and about 76,000 USDHs were locked into HIP-2 injections (not returned to the projecter). The total unnecessary loss is approximately 96,000 USDH, or 24 per cent of self-traded funds. Costs increase linearly with the volume of self-trading。

Seed price manipulation: seedPx of HIP-2 uses a window that covers the final 5% of the duration of the competition, rather than the liquidation price of the last block. Manipulating VWAP requires continuous expenditure on multiple blocks in the window, rather than a single post-injection, matching the cost to the total trade in the window。

Financial security: the bidder ' s quoted assets and the bid for tokens are held in trust by agreement throughout the process. Funds will never be held in the trust of the project party. In the event of failure, all quoted assets were returned through the claimaction and all currency was returned to the project owner。

Currency freeze: All currency transfers ( spot book, point-to-point, HyperEVM) are frozen during active competition. This prevents internal personnel holding userGenesis quotas or retaining supply from the project party from selling tokens through non-competitive channels during price discovery。

Offer activation delay: the next block of the bid after submission is involved in liquidation. This prevents the proponent of blocks or low-delayed participants from observing pending bids and inserting reactive bids within the same block to affect liquidation prices。

Impact analysis for the parties

Chargé d ' affaires: Hy-CO provides the projecter with a primary way to raise funds and inject liquidity in a single process. The projecter will compete with the HIP-1 deployment, receive the proceeds from the wallet (less the hip2Seed portion allocated to HIP-2) and receive automatic liquidity injections at prices found in the market. The trade-off is a reduction in controls over initial prices。

Hyperliquid users: Users acquire the ability to directly participate in the issuance of new team coins built on Hyperliquid. There is currently no primary method of buying items on the line; users either miss the initial distribution or buy them on the open order book after HIP-2 has been injected. Hy-CO provides users with a uniform pricing and decentralized fair access through the same interface they are already using. After settlement, the bidder must call the claim Action to move the acquired tokens and unused quoted assets into the spot account. The tokens are not automatically distributed. The spot order book is open only on HIP-2 liquidity and there is no organic limit to the depth of the order until the marketer and other participants have placed their orders. If many contestants sell it immediately after they claim it, the HIP-2 buyer hierarchy may quickly run out. This is the expected behaviour of any new listing and is not unique to HIP-6, but the front end should clearly show the status of ownership and set the expectation that the price differentials after early competition will be wider than in mature markets。

HYPE Holders: Hy-CO benefits HYPE Holders in two ways. First, the original distribution mechanism motivates new teams to build and distribute on Hyperliquid rather than on competitive chains, to grow ecosystems and to direct activities to Hyperliquid’s order book. Second, competition for matching quoted assets (e.g. USDH) increases their usefulness and reserves as a circular source of revenue to supplement Hyperliquid transaction costs through the Assistance Fund。

Liquidity providers and marketers: After the competition, the order book is launched in depth as a true buyer funded by competitive proceeds (through hip2Seed), rather than a thin injection of HIP-2. This provides LP and marketers with a more credible start-up price and deeper liquidity to trade from day one。

Certification and state growth: The cost of liquidating each block individually is O(T), of which T is the amount of price taken. At tickSpacingFactor = 1.003, T is limited to several thousand scales, but in practice most competitions will have several hundred of them occupied. At maxActiveActions = 16 the workload per block is 16 x O (T) at worst. Each operation is a comparison and addition to the aggregate scale budget and is comparable to the cost of matching the existing spot order book. No new password operation or external reading is required。

Future work items

THE FOLLOWING ARE BEYOND THE SCOPE OF THIS HIP, BUT THE NATURAL EXPANSION THAT SHOULD BE ASSESSED AS HIP-6 MATURES: GOVERNANCE REVIEW OF PROTOCOL CONSTANTS; BULK LIQUIDATION (ONE CLEARANCE PER K BLOCK); NON-LINEAR RELEASE PLANS; BATCH HIP-2 INJECTIONS; HIP-2 RESERVE MECHANISM; ACCEPTANCE MATURITY AND STATE CLEAN-UP; UI INTEGRATION。