Hyperliquid explains the on-chain transparency mechanism, responding item by item to the doubts raised by Sierra Kile and others

On December 22, in response to recent questions about the platform’s operational mechanism, Hyperliquid issued a detailed statement emphasizing its core competitiveness as a perpetual contract platform—complete on-chain verifiability.

The official statement pointed out that every fund flow on the platform is verifiable, with no “black box” elements. Among them, the claim by critics that the system lacks $362 million reflects a misunderstanding; the official clarified that this portion of funds is actually stored in HyperEVM USDC and is fully traceable.

Regarding several common misconceptions, Hyperliquid explained them one by one: the various functions on the testnet are limited to testing environments and are not applicable in the mainnet environment; the platform does not have privileged accounts or fee reduction mechanisms; the CoreWriter feature has been overinterpreted; this tool cannot arbitrarily mint tokens or move user funds, and its functionality is strictly limited.

As a rare fully transparent perpetual contract platform in the market, Hyperliquid allows anyone to run validation nodes to monitor on-chain status. Every order, every trade, and every liquidation exists on the blockchain in real-time, making this level of transparency difficult for other mainstream exchanges to achieve. The platform believes that this mechanism design is the best response to external concerns—any questioned data can be verified on-chain to obtain a definitive answer.

Analysts like Sierra Kile’s attention to the platform’s mechanism reflects users’ reasonable demands for trading security. Hyperliquid stated that it welcomes the community to verify all its commitments by running nodes and inspecting data.