HyperLiquid Addresses Decentralization Concerns as HYPE Token Drops 15%
The HYPE token experiences a 15% decline amid concerns over HyperLiquid's decentralization and validator fairness.
What to know:
- An employee at node operator ChorusOne raised concerns about the lack of decentralization and validator fairness within HyperLiquid.
- HyperLiquid announced plans to release its code as open-source when it is secure and intends to improve its decentralization efforts.
- HYPE dropped by 15% in the previous 24 hours.
HyperLiquid, known for its derivatives exchange, has addressed criticism regarding its decentralization and validator operations. The issues came to light when Kam Benbrik, an employee at ChorusOne, noted HyperLiquid's use of closed-source code which he claims potentially limits node operator's capabilities. Furthermore, HyperLiquid currently controls 81% of the staked HYPE, raising concerns about network control.
"If a single entity controls 1/3 of the stake, they can halt the chain. If they control 2/3 of the stake, they control the network entirely," Benbrik stated.
In response to these concerns, HyperLiquid indicated plans to implement a "Foundation Delegation Program" aimed at supporting high-performing validators, thereby enhancing decentralization.
Concerning the closed-source code, HyperLiquid remarked: "The node code is currently closed source. Open sourcing is important. Projects open source once development is in a stable state. Hyperliquid ships at orders of magnitude faster than most projects. Code will be open source when it’s secure to do so."
This dialogue has sparked negative sentiment towards HyperLiquid, contrasting sharply with the positive response received after the launch of its native HYPE token, which had surged from $3.57 to $33.5 amidst soaring trade volumes. HYPE has now fallen to $21.49, reflecting a 15.37% decrease in the last 24 hours as reported by CoinMarketCap.
