Hyperliquid Founder Says Most Wealth Creation Occurs Before Trillion-Dollar Company IPOs
Hyperliquid founder Jeff Yan stated on Bloomberg's Odd Lots podcast that if a company goes public with a valuation in the trillions, most wealth creation has often already occurred before the IPO, and these investment opportunities are only available to a select few.
He pointed out that this is a byproduct of how existing markets operate, rather than an intentional outcome. When a company goes public with a valuation of $1 trillion, $2 trillion, or $3 trillion, it can be said with greater certainty that most wealth creation has happened prior to that point.
Yan believes this reflects the limitations of the current financial system. He advocates for lowering participation barriers to allow more people equal access to financial opportunities, while also enhancing financial education to help investors assess whether opportunities align with their risk tolerance.
Hyperliquid operates as a perpetual futures protocol on the blockchain, supporting round-the-clock trading. Any entity can deploy new markets by staking 500,000 HYPE tokens and participating in daily Dutch auctions, with deployers controlling leverage, oracles, and contract specifications.
Yan positions the protocol as a neutral layer for financial activities, similar to internet infrastructure, with regulation falling on the entities deploying the markets rather than the protocol itself. The platform currently operates outside the U.S., with regulatory pathways in the U.S. still under discussion.
Private investors capture most of the gains during the growth phase before an IPO, while public market investors only gain trading opportunities after valuations have significantly increased. If on-chain protocols open up asset exposure earlier, it could change the traditional path of only being available to the public post-IPO.
Source: Public Information
ABAB AI Insight
Jeff Yan co-founded Hyperliquid Labs, which builds a perpetual futures protocol based on its own blockchain. He has previously expressed similar views at events like Token2049, arguing that growth returns in the pre-IPO phase of traditional finance are concentrated among a few, with the public only gaining trading opportunities post-IPO.
In the Bloomberg Odd Lots podcast, Yan used the example of trillion-dollar companies going public to illustrate that most wealth creation has occurred before the IPO. He advocates for expanding participation by lowering barriers and enhancing financial education, while positioning Hyperliquid as a foundational protocol capable of supporting various financial assets, with deployers rather than the protocol itself bearing the main control and compliance responsibilities.
Similar observations can be seen in other on-chain protocols attempting to provide exposure to traditional assets or pre-IPO related opportunities, with some platforms achieving this through perpetual contracts or tokenization. Hyperliquid is currently in the phase of expanding market deployment mechanisms and discussing compliance pathways in the U.S., while the protocol itself remains permissionless.
This represents a restructuring of the industry chain: extending asset trading from the public markets post-IPO to earlier stages of exposure on-chain. Private capital captures most of the appreciation before going public, while the public gains earlier participation through on-chain protocols, but this requires accompanying risk education and regulatory oversight at the deployment layer to avoid merely changing the access method without addressing information asymmetry.
ABAB News · Cognitive Laws
- Pre-IPO appreciation equals gains captured by a few.
- Lowering barriers plus education equals expanded participation.
- Deployment layer regulation equals protocol neutrality.