HLP0Price

(HLP0)

HLP is the native market-making vault position internal to the Hyperliquid Layer 1 blockchain. In contrast, HLP0 is a decentralized, omni-chain ERC-20 wrapper for those vault shares. It allows users to represent their HLP position as a liquid token on other networks, such as Arbitrum, enabling its use across various decentralized finance applications outside the native ecosystem.

No, HLP0 is not an official product developed or endorsed by the core Hyperliquid team. It is a third-party wrapper managed by an independent entity. Users should recognize that it operates as a separate bridge and tokenization layer between the Hyperliquid L1 and other blockchain networks.

The HLP0 team manages funds using a multi-sig configuration. The project emphasizes that the vault is designed to be overcollateralized, meaning for every HLP0 token issued, the protocol aims to maintain a corresponding value of assets in its controlled vaults. However, because the team may move funds between different protocols to optimize rewards, users should be aware of multi-sig management risks and the importance of transparency regarding reserves.

The project utilizes a dual-token system to cater to different risk profiles. HLP0 serves as a pure wrapper that strictly holds native HLP shares, focusing on direct representation. HLP0+, on the other hand, is a discretionary vault where the management team actively moves capital across different chains and strategies to seek higher rewards, which entails a higher level of strategy-based risk compared to the standard wrapper.

HLP0 is designed to increase the utility of native vault positions by making them liquid and composable. Its primary use cases include serving as collateral for lending and borrowing on supported decentralized platforms and providing liquidity in pairs on various decentralized exchanges. This allows users to maintain exposure to the underlying vault rewards while simultaneously participating in other activities across the broader blockchain ecosystem.

HLP0 utilizes the LayerZero OFT (Omnichain Fungible Token) standard, which facilitates movement across different EVM-compatible chains like Arbitrum and Avalanche. For redemptions, users burn their tokens through the project dashboard to receive USDC. This process typically takes several days to complete, as it must account for the native lock-up and withdrawal periods required by the underlying Layer 1 vault.