Is HyperLiquid trustworthy?

Is HyperLiquid trustworthy? It's kinda weird that no one seems to be trying to regulate HyperLiquid. I mean, they don't take direct bank payments, but you can deposit without any verification, even for stable coins, which most exchanges require proof of income for these days. Plus, HyperLiquid doesn't accept USD TRX (Tron), which suggests they don’t want addresses that can't be blacklisted. Instead, they go for USDT over ETH, where addresses can be blacklisted. Sure, it's still a DEX, but it’s not just that anymore; it’s becoming more mainstream and is being seen as a legitimate exchange. We're even seeing proposals for HyperLiquid ETFs. I can’t help but think this might be backed or initiated by the US government. It’s hard to believe they don’t have some sort of silent support from powerful folks. What do you all think?

As long as there is a centralization entity behind the project (The Hyperliquid foundation) they can always be pressured, maybe not necessarily to introduce KYC given their decentralized nature, but at the very least monitor or freeze addresses when they are asked to, something that Uniswap already does for example:

Great response. Very helpful. I didn't know this about Uniswap. Need to check Hype's ToCs.  Thank you.

Hyperliquid is its own independent blockchain. You cannot deposit tokens from another network directly, although there are bridges that abstract the process to reduce friction when depositing assets like BTC and USDT. Whether you have USDT on Tron, Ethereum or Hyperliquid, it can be frozen by the issuer. Hyperliquid doesn’t require the same level of trust as centralized exchanges, that’s why the same regulations don’t apply. If suddenly it becomes widely used for money laundering, we can assume there will be a government somewhere who will attempt to charge the developers or bridge providers. Recently, a developer known as Perpetual Cow launched HyperWagyu, which is a bridge between Monero and Hyperliquid, and users have been speculating how long it will be before somebody tries to shut it down.

I am sorry but you are not correct here. Tether LTD has explicit capabilities built to freeze assets, unlike TRX addresses. Due to the nature of its architecture and philosophy, it is impossible by design, unless you carry out a 51% attack. This is why you will see a lot of scammers demand USDT over TRX. Also, it is possible to directly deposit Arbitrum and BTC as far as I know on Hyperliquid, directly.

Tron’s codebase is very similar to Ethereum. The Tether TRC-20 contract has the same functions as the Ethereum version, including the ability to blacklist addresses. https://tronscan.org/#/token20/TR7NHqjeKQxGTCi8q8ZY4pL8otSzgjLj6t/code?func=Tab-write-F3nonePayable TRON also works directly with law enforcement to help Tether freeze user funds. It is only preferred by criminals because it is the most used version of USDT. ”As part of a joint effort between Tether, TRON, and TRM Labs, the T3 Financial Crime Unit successfully froze over $100 million in criminal assets in the last four months of 2024 alone.” https://tether.io/news/tether-recognized-for-assisting-the-united-states-secret-service-in-23m-freeze-related-to-transfers-on-sanctioned-exchange-garantex/

It is more the actual currency and its contract, rather than the chain itself. In other words, USDT have full control over their issued stablecoin whether that's on TRON, or any other chain. I also don't see them deploying their coin in the future (officially) on any blockchain where this is not possible to do, simply because they have (or want) to comply.

Yes the code is based off of ETH but the mechanisms to block use of generated addresses is absent from TRC20. Do you have any evidence that the addresses frozen were TRC20 based and that the private keys were NOT with Garantex? If the private key of the addresses was with Garantex - a centralized exchange then that does not mean TRC20 allows freezing. Show me an example wherein a user had TRC20 address' keys and still the assets were frozen. What you shared does not fulfill that criteria. That TRON participated in a so called task force means nothing. Not sure what you are trying to show in the link you shared, Tronscan says the Reputation as OK for that address.

Someone already deployed USDD. It is unusable within the  EU and USA.. but exists based and on Tron - https://www.usdd.io/ Yes it does not have any blacklisting feature,  meaning they cannot ban your address over that network.

It's SG based platform. All of Hyperliquid teams were at SG. It's also unavailable for US resident. To call hyperliquid gets a support from US is very wrong. If they're officially supported by US gov, they should have granted license to operated in US, while the fact they're not.

The link I posted is supposed to show the specific function in the USDT contract which allows blacklisting. If you wait some seconds, the page automatically scrolls to that part. Anybody with write permission can call the function to prevent interaction with the USDT token. There is even a destroyBlackFunds function which allows Tether to delete someone’s balance. You can see the event logs of this transaction that the Tether multisig owner used the blacklist function 20 hours ago on address TL9BebWFMk2hTe7jXUCB4y4KT8GBpBJzV9 with 6.9 million USDT. https://tronscan.org/#/transaction/aadf363568ea36fc0bc590821405bab2edeecc895d5cf91390839c784287949a/event-logs

HyperLiquid asks for an email address, that is it. Not sure what you mean by 'unavailable for US resident'. Do you mean it is IP address/geo blocked? use a proxy/VPN. It does not ask where you live. Hype has witnessed lots of millions being made by whales, and now an ETF. Too many bold and wild moves for it to be overlooked by the US gov. I am speculating here , this could be a trojan horse DEX.

Thank you for educating me. Fair explanation. At least TRX isn't afected by this. Need to check specifications for USDD.io

I only just realized that this is how Hyperliquid works. I've been hearing about its potential since last year, and after checking out the platform, it clearly can provide profits for anyone who decides to invest through it. Although its price has dropped significantly compared to last year, many investors likely see this as a great buying opportunity. But of course, We still need to 'DYOR' (Do Your Own Research) before making any investment.

I trust HyperLiquid to an extent. Given the alternatives, HyperLiquid is the best possible choice available so I'm inclined to lean towards them. I also don't think it's a US government project because the co-founders are not Americans iirc and they have been more about their users from day 0. You can see that from how they conducted their airdrop— clean, simple and more rewarding for the average user.

HyperLiquid is good but when you talk about trust like we have for bitcoin and most top coins then absolutely no because the owner of HyperLiquid can ruin everything one day and everyone will be in regret so I don't think first should be talked about in HyperLiquid instead we can say if we can see value in it for a short term then I will agree with you that I can see some value in it for a short term. They can be bullied any day once it gets to the USA government head especially using KYC as a weapon to HyperLiquid.

In my observation, no matter how decentralize a DEX will say, the regulators are always the tough and last boss of the game. They'll be able to shut them down if they are not cooperative. And that's why their way to regulate them as always is to follow the tracks of the developers and whoever are behind them. Could be sued for non compliance or pressure them as long as they've found the leads.