Hyperliquid Eyes Prediction Markets With ‘Outcome Trading’ Proposal

Hyperliquid is the latest crypto project setting its sights on prediction markets, announcing plans to roll out support for what it calls “outcome trading,” according to a tweet posted Monday.

The feature will be introduced through Hyperliquid Improvement Proposal 4 (HIP-4), which would allow HyperCore, the protocol’s core infrastructure, to support fully collateralized contracts that settle within a fixed range.

“They are a general-purpose primitive that are useful for applications such as prediction markets and bounded options-like instruments,” it said, adding that it has seen “extensive user demand” in both areas, with “builders will likely think of novel applications as well.”

Prediction markets have seen a surge in activity, with $12.4 billion in trading volume recorded last month, according to data from Dune, as traders increasingly turn to event-based markets spanning politics, sports, and culture.

“Hyperliquid is about to grow the Prediction Markets TAM, which is great for the industry as a whole,” Farokh Sarmad, co-founder of Myriad, a prediction market owned by Decrypt‘s parent company Dastan, said. “This should bring more attention, more users, and most importantly, allow us to approach prediction markets in ways we haven’t been able to before.”

The HIP-4 proposal itself was first published in September last year. It promotes non-linear, dated contracts and an alternative form of derivatives trading that avoids leverage and liquidations, features that have become synonymous with high-risk crypto trading venues.

“Outcomes” is still under development and is currently being rolled out on Hyperliquid’s testnet. According to the proposal, canonical markets will be deployed when technical work is complete, with contracts denominated in the protocol’s USDH stablecoin. “Pending user feedback, the infrastructure could later be extended to permissionless deployment,” it added.

The announcement appears to have been welcomed by the market. Hyperliquid’s HYPE token is trading at $32.83, up more than 11% over the past 24 hours, according to CoinGecko data.

Prediction markets under scrutiny

Hyperliquid’s move comes as prediction markets face mounting regulatory pressure.

The scrutiny has intensified in recent weeks, particularly around sports and political markets.

Polymarket, one of the sector’s most prominent platforms, has been hit with bans and enforcement actions in multiple jurisdictions, including Hungary, Portugal, Nevada, and Tennessee, where regulators have ordered platforms to shut down and even refund wagers.

Central to the dispute is whether prediction markets should be treated as gambling sites or as financial venues offering so-called “event contracts.”

Despite the regulatory headwinds, major crypto firms continue to push into the space.

Last week, Coinbase rolled out its own prediction market product to users across all 50 states, leveraging contracts from Kalshi.

“Prediction markets are the ultimate form of truth-seeking,” Coinbase CEO Brian Armstrong tweeted.

“When there’s skin in the game, the output is far more reliable,” he added. “Everything else is biased by someone’s agenda. I think we’ll look back at prediction markets as a breakthrough in how we discover truth in the world.”