HyperEVM "failed" because the mental model was wrong. The core idea of an ecosystem, a platform, and apps doesn't translate here. Hyperliquid is a platform enshrined with a killer product. Don't compete with it. The HyperEVM apps of today are competing. Valantis' biggest friction as a yield protocol is we were competing to try to pull capital off of HyperCore. The ask most HyperEVM teams are implicitly making to their users is to move away from Hyperliquid's core product, and onto theirs. "Move USDC/BTC/HYPE out of your trading balance, and into my protocol." Portfolio Margin makes this 100x worse. Many teams are going to have a hard time attracting liquidity when it has so much more utility staying in a user's wallet on Hypercore. We basically rebuilt the Valantis' thesis in 2026 around this. - Build your products into the experience - If you ask capital to move, amplify its utility The market for Native Staking is larger than liquid staking for a reason. People literally save $40M+ annually through Native Staking Trading Fee Discounts; and Liquid Staking Collateral demand is not high enough to outweigh it. LSTs today are in competition with HyperCore Trading. HyperEVM exceeds when extending the core functionality of Hyperliquid- not competing with it.

Remember CBB Cartel's article on dominating HyperEVM x HyperCore arb? "We identify 2 other competitors who are doing exactly like we do. They don’t seem really big though. We want to cook them.... We stake 100k HYPE to get a 30% rebate.... I remember this day when both competitors turned off their bots, my brother and I are travelling from Paris to Dubai and just frenetically watching the bot printing money. $120k profit in 24 hours." Traders are taking cheap fee optimizations by running what should be Taker strategies with Maker orders just to compress fee spend. Ppl make their strategy less aggressive because being aggressive is expensive. The way to win is create structural edge. It's never been cheaper to lower your fees on Hyperliquid with @ValantisLabs When there is money on the table, be a Taker. Cook your competition.

The last 48 hours I've handcrafted a set of new Trades enabled by Liquid Staking Discounts. We'll be releasing more info about how Traders today are leveraging lower fees + more margin to create new strategies. But for now, enjoy the alpha.

This is a genuinely incredible feature nobody knows about because the UI will tell you it can take up to 7.2 days. The last time I unstaked it took a minute or two and it works for large amounts as well👍

“Valantis' HOT-AMM shipped and settled volume on @CoWSwap” “AMM infrastructure was a low-take-rate business” I don’t think we’ve ever really addressed our pivot here before - there exists a totally alternative reality where Valantis kept refining prop AMMs on EVM. But why we are where we are today. A few things changed our thinking: 1. A surprising amount of AMM liquidity was ultimately being subsidized by asset issuers. Instead of competing for a few bps from fee-sensitive market makers on majors, it made more sense to build products for the entities already paying to bootstrap liquidity. For us, that became LST teams. It’s much easier to capture value when someone has an incentive to pay you outside of PnL. Markets we had more advantage in quoting. 2. infrastructure wasn’t where most of the economic value accrued—it was the market makers. If we kept building increasingly sophisticated AMMs, eventually we’d have to run strategies ourselves. We truly considered - but thesis broke down for us when it became obvious firms like Wintermute had structural informational advantages (OTC flow, distribution, relationships) that we simply couldn’t replicate. ETH-USDC pvp with Wintermute is not the best ROI on your time. 3. Even if you don’t run strategies, building a durable moat is difficult. MM Liquidity is extremely fee-sensitive, so competitors can undercut you. Your defensibility becomes order flow (integrations) or smart contract quality. Both are real moats, but they’re incredibly hard-earned. Security and execution become the entire game (high cost, constant upkeep) for a low pay out. Could we have made it work? Maybe. Should we have? Probably not. Has the market reached its final form? Definitely no. Game not over.