When Hyperliquid takes away Solana's "internet capital market" script

Author: Hu Tao

In the cyclical nature of the cryptocurrency market, Solana once returned to its peak with the narrative of being the "Ethereum killer" and its extreme performance. However, entering 2026, this once high-powered "high-performance computer" is facing unprecedented deceleration pressure, which is first reflected in its price.

In the past year, the maximum decline of SOL's price from its peak reached 73.5%, the largest drop among all mainstream cryptocurrencies. Moreover, during the recent market correction in the past month, SOL's upward momentum has also been very weak, significantly lagging behind other mainstream cryptocurrencies like BTC and ETH.

Additionally, Solana's core vision of "Internet Capital Markets" has also suffered a heavy blow amid internal and external troubles, forcing the senior team of the Solana Foundation to frequently speak out recently to generate momentum for its ecosystem in public opinion.

Solana's Core Narrative Frustrated

In recent years, Solana has been trying to tell a story far grander than just being a "high-performance public chain."

According to the definition by the Solana Foundation, Solana's ultimate goal has shifted to "Internet Capital Markets"—a global trading network that brings stocks, commodities, futures, perpetual contracts, and even all real-world assets onto the blockchain.

Now, when you open the homepage of Solana's official website, the most eye-catching slogan remains: "A capital market built for every asset on Earth."

This means that Solana not only aims to challenge Ethereum but also attempts to replace traditional exchanges, brokers, and clearing systems, becoming the on-chain version of Nasdaq. High speed, low fees, high throughput, and a relatively mature user experience, along with the backing of Wall Street capital, made Solana once regarded as the public chain closest to this goal.

But the problem is that when the "Internet Capital Markets" began to take shape, the market found that it might not be Solana occupying the core position.

The Unexpected Impact of Hyperliquid

One of the biggest structural changes in the crypto industry over the past year is the migration of the perpetual contract market from traditional CEX to on-chain.

The biggest beneficiary of this trend is not Solana, nor Ethereum, Sui, or other networks, but Hyperliquid.

Initially, Hyperliquid was just an on-chain perpetual contract trading platform, but as its Layer1 strategy progressed, it has gradually evolved into a complete financial infrastructure network. Compared to Solana's broad and abstract "capital market" vision, Hyperliquid chose a more focused and transaction-driven path.

For a long time, although the Solana ecosystem has a large number of DeFi projects, its core liquidity has always leaned more towards spot trading, Meme Coins, and on-chain speculation. The infrastructure capable of supporting institutional-level trading depth, risk management, and high-frequency trading needs has always been immature.

More critically, Hyperliquid has gradually proven something that many people previously overlooked: "Internet Capital Markets" do not necessarily require a generalized ecosystem.

For high-frequency financial trading, the importance of performance, matching, liquidity, and trading experience far outweighs the "richness of on-chain applications." This means that a vertical Layer1 specifically designed for financial trading may be more suitable to become the core of on-chain capital markets than a generalized public chain like Solana.

This is also why more and more funds, traders, and attention are beginning to converge on Hyperliquid.

After the Drift Incident, Solana is Forced to Adjust Its Perpetual Contract Market Strategy

If Hyperliquid has externally squeezed Solana's "capital market" strategic space, then the attack incident on Drift Protocol has internally torn a huge hole.

In early April this year, the Solana DeFi protocol Drift suffered governance and oracle attacks, resulting in losses exceeding $200 million.

As one of the most important perpetual contract protocols on Solana, Drift has always played a core liquidity role in Solana DeFi. After the hacker attack, the protocol's functionality was directly paralyzed, affecting a large number of assets, vaults, and associated protocols within the Solana ecosystem, leading to a rapid deterioration of market confidence.

Perpetual contracts are a battleground in the DeFi space. Faced with the market vacuum left by Drift and Solana's strategic gap in the on-chain derivatives field, the Solana officials must strongly promote new alternative products to capture users and market share in the frontline of Solana's "Internet Capital Markets" strategy.

At this time, the options in front of Solana officials include a series of products such as Pacifica, Phoenix, Jupiter, GMTrade, Bullet, Blink, etc. However, Solana founder Anatoly Yakovenko firmly chose Phoenix.

In the past five days, Toly has published at least twenty tweets or retweets related to Phoenix, either sharing other industry people's testing experiences with Phoenix, directly recommending the use of Phoenix, or discussing his views on Phoenix.

Regarding this "preference," Toly has repeatedly explained that Pacifica has not executed trades on the Solana chain, its compatibility is as good as Hyperliquid, and Jup has already matured, while he is more focused on early teams from 0 to 1. Meanwhile, Phoenix is decentralized and can atomically combine with all other applications on Solana.

Under Toly's influence, Phoenix's popularity has ranked among the top three on RootData's popular project list for several consecutive days, creating a historical peak in its popularity index.

However, in terms of trading volume, Phoenix still lags far behind other established perpetual contract platforms. According to DeFillama data, Phoenix's long-term daily trading volume was below $4 million, but recently, boosted by market enthusiasm, its daily trading volume first broke $80 million, yet it still ranks outside the top 20 among all perpetual contract platforms, with a gap of over 20 times from the top 5 platforms (the lowest being $1.6 billion).

Solana's Public Relations Offensive and Internal Fractures

Faced with Hyperliquid's strong rise and the wounds within its own ecosystem, Solana supporters have chosen a path that seems to "attack with the spear of the enemy"—using decentralization as a weapon to launch a public relations attack on Hyperliquid.

Solana Foundation member @harkl_ tweeted that Hyperliquid's slogan is a decentralized trading platform, but the reality is 24 validator nodes, closed-source node code, a single bridge carrying billions of dollars in funds, and records of forced settlements during market fluctuations.

"Can you participate in any part of the protocol stack with your own resources without the approval of a trusted third party? If not, then it is not permissionless. No matter what you do, you cannot run the Hyperliquid sorter," Toly further stated.

This argument sparked intense discussions in the crypto community. Supporters believe Toly has hit the core weakness of Hyperliquid—if there are fewer than 30 validator nodes, the node code is not public, and the bridge is highly centralized, then what essential difference does the so-called "on-chain capital market" have from the custodial model of CEX?

Opponents pointed out that the number of validators in Solana has sharply decreased from 2,560 to about 756, the Nakamoto coefficient has dropped from 31 to 20, and the top twenty validators control over one-third of the staking share—against this backdrop, discussing "decentralization" seems somewhat hypocritical.

A more challenging issue comes from within the Solana ecosystem. The unanimous "preference" of many senior members of the Solana Foundation has caused dissatisfaction among many other protocol developers.

"They will promote what they think is most beneficial to themselves, pushing others away just because a team meets a certain standard, turning friends into enemies," said kdotcrypto, co-founder of Bulk.

The comments from Pacifica founder Constance were more restrained yet more damaging: "We chose Solana in 2025, did not take any funding from the foundation, nor did we raise funds from investors; we just want to make a good product first and let the market decide." The phrase "let the market decide" subtly protests against the Solana Foundation's role as both referee and player.

The harshest truth in the crypto market is that users do not care about grand narratives; they only care about depth, liquidity, and security. The rise of Hyperliquid is not only a technical victory but also a dimensional blow to the narrative of "general-purpose public chains"—it proves that the core of building capital markets does not necessarily require a complex ecosystem, but rather an extreme matching engine.

Now, Solana is mired in a quagmire of competing "decentralization metrics" with its competitors, while its favored Phoenix still has a trading volume gap of 20 times from mainstream derivatives platforms.

In this battle for the ultimate outcome of the "Internet Capital Markets," if Solana cannot regain its dominance in the derivatives field in the second half of 2026, it may still be an excellent Meme paradise, but it will only drift further away from the dream of "carrying global assets."