Is Lighter The Next Hyperliquid?

After Hyperliquid’s storming 2024 debut, groundbreaking token airdrop, and it’s seemingly unstoppable rise since, crypto traders have been on the lookout for a challenger. Lighter could be it.

The decentralized derivatives exchange (DEX) specializes in perpetual futures (perps), a type of derivative contract that lets traders speculate on crypto price movements.

Like an exchange-traded fund (ETF) in traditional finance, perps allow investors to gain exposure to price volatility without owning the underlying asset.

Launched in private beta this past January, Lighter positions itself as a specialist, high-performance DEX with unique capabilities. Like Hyperliquid, it aims to deliver CEX-level performance on-chain.

What makes Lighter different is its proprietary execution environment. Trades are powered by a custom zk-rollup that enables the DEX to deliver a CEX-like central limit order book (CLOB) experience.

The ability to aggregate buy and sell orders with the speed and efficiency of a traditional stock exchange has largely eluded DEX projects – but Lighter claims to have it sussed.

Closing the CEX-DEX Gap

Another differentiator is Lighter's zero-fee option for retail traders. There's also the Lighter Liquidity Pool (LLP), a vault that runs a market-making strategy – inviting comparisons to Hyperliquid's HLP. Traders can deposit capital into the pool, which Lighter uses to quote and fill perp trades.

Since launch in January, Lighter has grown to more than 56,000 users and gathered a TVL of $340 million. Analysts say some of the growth is down to points farming, but given that the nascent exchange only just left beta, it's still impressive.

Founder Vladimir Novakovski hails from an AI and FinTech background, and the project has secured backing from big tech VCs like a16z and Lightspeed Ventures.

The DEX's monetization strategy focuses on institutional traders executing high-frequency trades – leveraging Novakovski's earlier experience as VP of engineering at trading platform Addepar.

After its public rollout in September, Lighter plans a new feature which would give traders the flexibility to use their LLP positions as margin. That way they'll be able to simultaneously earn yield and trade with the same capital – an innovative twist that the majority of DEXs, including Hyperliquid, can't match.

Zk Is the Endgame

Lighter’s DEX exemplifies a common rallying cry in Ethereum: ‘zk is the endgame.'

Zero-knowledge rollups (zk) are a Layer 2 blockchain scaling solution that uses zero-knowledge proofs to increase transaction throughput and lower costs on the main (Layer 1) chain.

They work by taking multiple transactions off-chain, bundling them into a single transaction, and then returning them to the main chain via a cryptographic proof (the ‘zero-knowledge' bit) for verification.

Previous DEXs like dYdX v3 tried to deliver a CEX-level CLOB experience, but capabilities were limited. It could zk-prove a trader's end balance but not the full trade execution journey. Lighter perpetual DEX uses virtual machine tech to zk-prove every computation its CLOB engine makes, with sub-second latency.

Lighter says it's built a proprietary zk-rollup that scales more efficiently than others, potentially giving the DEX the freedom to become multi-chain in the future.

Lighter vs. Hyperliquid

How does Lighter stack up against Hyperliquid? Crypto trader lykt.hl has used both and thinks Lighter has real growth potential, though it's too soon to call it a threat to Hyperliquid's DEX dominance.

"I think it's possible for Lighter to carve out its own niche and take 10-20% of perp dex market share by leveraging its low fees to attract retail traders."

The popular DeFi anon adds that Lighter's liquidity is "good enough" on major coins but falls behind Hyperliquid on altcoins. UX is worse than Hyperliquid, lykt says, "but good enough overall."

"LLP reminds me a lot of HLP in its early days, and (HLP's) yield will likely continue to decrease if more market makers come to Lighter. I am actively farming Lighter, but still using Hyperliquid for my main trades," lykt.hl added.

Crypto trader and DEX influencer BULBUL offers this snap comparison of Lighter's UI and user experience benefits vs. Hyperliquid.

"Based on my personal experience trading on both, Lighter offers detailed UI/UX options that reduce inconvenience, and its fee-free policy is a powerful market entry tactic. Hyperliquid's strength is its server capabilities, especially in extreme situations where orders pile up, ensuring transactions don't fail."

Too many Freebies?

In a recent note to investors, K33 crypto analyst David Zimmerman said Lighter's recent growth metrics look impressive out of the gate, especially for a DEX in closed beta.

The exchange has achieved over $2 billion in daily trading volume, and TVL has risen steadily from $2.5 million at the beginning of March to over $200 million as of the end of July 2025. Still, he noted some concerns.

"With open interest at $83 million against a whopping $2.3 billion in daily volume, Lighter's volume-to-open-interest ratio currently sits at around 27, compared to Hyperliquid's at 0.76, Jupiter at 2.44, and dYdX at 0.40."

Zimmerman said a healthy ratio sits at around ≤5, with ratios higher than 10 suggesting a lot of wash trades or volume that's driven by incentives.

Lighter has mechanisms designed to stop wash trading, but it's unclear how effective they are in a testnet scenario. Its points system, Zimmerman warned, "is clearly contributing heavily to the platform's upbeat figures."

"Seen in isolation, big volume numbers need substance to back them up. Historically, metrics such as volume and TVL drop off sharply after major market entry campaigns come to an end."

Hyperliquid, in contrast, has been fully public for months and has held on to its lead even after the buzz from its massively successful HYPE token airdrop faded.

Lighter remains in closed beta for the time being, and according to Zimmerman, much of the current market interest is driven by airdrop speculation. He said:

"The points system has already started for beta participants, leading to criticism of insider advantage. As the protocol has not been opened to the public yet, Lighter is not battle-tested."

The Take Away

Lighter’s move into the DeFi spotlight points to hunger for meaningful innovation in the DEX space. The tech stack, VC backing, founder track record, and overall growth suggest it could be more than points pump.

K33's Zimmerman cautions that the Hyperliquid vs Lighter narrative is overheated. The DEX space isn't winner-take-all, and Lighter can succeed even if it doesn't leave Hyperliquid in the dust.

"Having multiple perp DEXs can be a net win for the space. For retail traders, access to zero fees and generous incentives can be extremely valuable. Even if liquidity is thin in some markets relative to other venues, limit orders and smart execution can still make trading on Lighter worthwhile."

Benzinga Disclaimer: This article is from an unpaid external contributor. It does not represent Benzinga’s reporting and has not been edited for content or accuracy.