Frequently Asked Questions

Staking in the Hyperliquid ecosystem refers to the act of depositing (i.e. staking) a certain amount of HYPE in order to power validator software which drives the Hyperliquid consensus mechanism together with other validators on the network.

In exchange for these services, the network rewards the participating validators with extra HYPE for securing the Hyperliquid blockchain.

Liquid staking tokens (or LSTs for short) are a group of tokens created and issued by different staking protocols and providers, such as Staked Hype (stHYPE) and Kinetiq (kHYPE).

These tokens are issued to users depositing HYPE into the mentioned staking protocols and/or services and represent their proof of deposit.

All of the mentioned liquid staking tokens (stHYPE, kHYPE) have a built-in mechanism for accruing staking rewards through different mechanisms.

The yield received through liquid staking tokens comes from staking rewards issued by the Hyperliquid network to validators participating in securing the network.

• Always represents native HYPE 1:1
• Accrues protocol rewards in the form of a rebase
• Rewards automatically accrue to the holder's wallet
• Token balance increases over time while maintaining 1:1 exchange rate

• Continuously accrues rewards over time
• Maintains a constant quantity of tokens in your wallet
• Value of the kHYPE token grows as rewards accumulate
• kHYPE
  exchange rate increases over time
• The longer you hold kHYPE, the more rewards you accrue

The kHYPE token uses a reward-accrual model where the exchange rate increases over time as staking rewards accumulate. This is different from a rebasing model where the token supply adjusts to maintain a stable value.

The frictionless accrual of yield makes the reward-accrual model superior to rebasing, as there are no constant balance changes in your wallet.

The reward-accrual LST design employed by Kinetiq (kHYPE) is generally considered superior to rebasing models because:

• Consistent token count: Your token balance doesn't constantly change
• Frictionless yield accrual: Rewards accumulate automatically without balance updates
• Better UX: No need to track changing balances due to rebasing
• Tax advantages: Potential tax benefits depending on jurisdiction

Yes. The performance fee is already subtracted from the profit estimate shown in the interface, even though the actual fee is taken only when actually exiting the position.

This means the number you see represents your expected net profit after all fees.

To minimize potential losses when exiting your position:

• Monitor market conditions before closing positions
• Time your exits during favorable market conditions
• Use smaller position sizes to reduce market impact
• Check current stHYPE/kHYPE to HYPE exchange rates before exiting
• Consider partial exits instead of closing entire positions at once

If your leveraged HYPE position gets liquidated:

• You'll face a liquidation penalty
• Part of your collateral will be used to cover the debt
• Remaining collateral (if any) will be returned to you
• Your position will be automatically closed

Prevention is key: Monitor your safety ratio and maintain adequate buffers.

We recommend:

• Daily checks for highly leveraged positions
• Weekly reviews for conservative positions
• Immediate attention during periods of high market volatility
• Real-time monitoring if your safety ratio approaches danger levels

Set up alerts if possible to notify you of significant changes.