Order Book
The Hyperliquid Order Book is the backbone of trading on the platform, designed to function similarly to centralized exchanges but with the advantage of being fully on-chain. This ensures transparency and fairness while maintaining high-speed matching and robust operations.
Overview of the Order Book 📘
Core Functionality: Each asset has its own order book, where orders are matched based on price-time priority.
Tick Size and Lot Size:
Prices are placed as integer multiples of the tick size.
Sizes are specified as integer multiples of the lot size.
On-Chain Matching: All operations occur directly on-chain, integrating seamlessly with the Clearinghouse to ensure margin and position checks are consistently enforced.
Key Features:
Fully On-Chain: Transparent and verifiable, with every operation recorded on the blockchain.
Margin-Integrated: Margin checks are conducted when orders are placed and again when they match, ensuring resilience against oracle price fluctuations.
Fair Matching: Orders follow a price-time priority, rewarding earlier placement at the same price level.
Order Types 🛒
Hyperliquid offers a wide range of order types, catering to diverse trading strategies:
Primary Order Types:
Market Order: Executes immediately at the current market price.
Limit Order: Executes at the specified limit price or better.
Stop Market Order: A market order activated when the price hits the stop price, used to limit losses or lock in profits.
Stop Limit Order: A limit order triggered at a selected stop price.
Advanced Order Types:
TWAP (Time-Weighted Average Price): Divides a large order into smaller sub-orders executed at intervals to minimize market impact.
Details: Sub-orders execute every 30 seconds, targeting the TWAP schedule while limiting slippage to 3%.
Scale Orders: Places multiple limit orders within a defined price range to capture volatility effectively.
Order Options ⚙️
Reduce Only: Ensures the order only reduces an existing position rather than opening a new one in the opposite direction.
Good Til Cancel (GTC): The order remains on the book until filled or canceled.
Post Only (ALO): Adds an order to the book without executing it immediately.
Immediate or Cancel (IOC): Cancels the order if it’s not immediately filled.
Take Profit (TP): Triggers a market or limit order to close a position at a specific profit level.
Stop Loss (SL): Triggers a market or limit order to close a position at a specified loss threshold.
TP/SL Orders:
Mark Price Triggered: TP/SL orders are activated using the mark price for accurate execution.
Drag-and-Drop Editing: Modify TP/SL directly on the TradingView chart.
Market vs. Limit TP/SL:
Market: Executes with a 10% slippage tolerance.
Limit: Allows traders to control slippage with aggressive or conservative limit prices.
Contract Specifications 📝
Hyperliquid’s perpetual contracts are designed for simplicity and efficiency, catering to both institutional and retail traders.
Linear Perpetuals: Collateralized with USDC, but prices are denominated in USDT for liquidity and accessibility (technically quanto contracts)
No Expiration: Funding payments align perpetual prices with spot prices over time
Maximum market order values: $15M (leverage ≥25), $5M (leverage 20-25), $2M (leverage 10-20), $500K (lower leverage)
Maximum limit order values: 10x the corresponding market order limit
Margin options: Cross or isolated margin per wallet
Note: PURR-USD and HYPE-USD are denominated in USDC due to their primary liquidity source being Hyperliquid spot.
Read more about Contract Specifications
Index Perpetuals 📊
In addition to spot-based perpetuals, Hyperliquid offers index perpetual contracts, which track formulas instead of spot prices.
Mechanism: Validators periodically report the index formula's value, which is used instead of a spot oracle price for funding calculations
Current indices: NFTI-USD (blue-chip NFT collections) and FRIEND-USD (friend.tech subjects)
Function: Work exactly like normal perpetual contracts but track custom formulas rather than asset prices
Learn more about Index Perpetuals
Hyperps (Hyperliquid-Only Perps) 🚀
A unique offering by Hyperliquid, Hyperps are perpetual contracts that don't require an external spot or index oracle price.
Funding Rates: Determined relative to an 8-hour exponential moving average of the mark price, reducing susceptibility to manipulation
Conversion to Vanilla Perps: Once the underlying asset becomes widely traded on major platforms (Binance, OKX, Bybit), Hyperps transition to standard perpetual contracts
Trading Restrictions: Low leverage and isolated margin only - higher risk due to low liquidity, high volatility, and potentially extreme funding rates
⚠️ Important: Heavy price momentum creates strong funding incentives for opposite positions over the next 8 hours. Only trade contracts you fully understand.
Perpetual Assets 🌍
Hyperliquid supports trading for 100+ assets, with new listings influenced by community input. The protocol is transitioning to a permissionless listing process through HIP-3 (Builder-Deployed Perpetuals).
The Hyperliquid Order Book combines the best features of centralized exchanges with the transparency and security of decentralized systems. By supporting diverse order types and contract styles, Hyperliquid ensures a robust and flexible trading experience for all users.
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