The elephant in the room for Hyperliquid and all of crypto is user retention. Nobody likes to talk about it but here are some metrics
Hyperliquid is a best in category application but it still suffers from tough retention numbers keeping only 20% of the top users after 6 months. These are actually top tier metrics in crypto
The silver lining for Hyperliquid is that perps are a whale driven business model where only the top quantile of traders really matter and there Hyperliquid has better retention for higher volume users in the first month than lower volume users in the first month
The problem with having retention curves that look like this is the aggregate volume and fee metrics can look good, but teams are on a constant treadmill to replace or reactivate users. This is made extra difficult because decentralized products suffer from being unable to efficiently target their users with retention bonuses (sybil risks) or even being able to efficiently attribute customer acquisition costs.
I am optimistic though because for the first time during my tenure in crypto we are starting to talk about revenue, which naturally leads into the quality of revenue and how retentive the users are. These conversations will lead to better tooling and vendors to service apps as the industry matures.
Hyperliquid is a best in category application but it still suffers from tough retention numbers keeping only 20% of the top users after 6 months. These are actually top tier metrics in crypto
The silver lining for Hyperliquid is that perps are a whale driven business model where only the top quantile of traders really matter and there Hyperliquid has better retention for higher volume users in the first month than lower volume users in the first month
The problem with having retention curves that look like this is the aggregate volume and fee metrics can look good, but teams are on a constant treadmill to replace or reactivate users. This is made extra difficult because decentralized products suffer from being unable to efficiently target their users with retention bonuses (sybil risks) or even being able to efficiently attribute customer acquisition costs.
I am optimistic though because for the first time during my tenure in crypto we are starting to talk about revenue, which naturally leads into the quality of revenue and how retentive the users are. These conversations will lead to better tooling and vendors to service apps as the industry matures.
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