Hyperliquid, a decentralized exchange and innovative blockchain-based trading platform, generated about $105 million in revenue in September 2026. This is about the same as a year earlier ($108 million) despite the intervening crypto bear market.¹ Hyperliquid revenue has remained strong partly because activity on the platform has become more diversified.

In mid-2025, core trading fees (from perpetual futures contracts on crypto assets listed by the Hyperliquid team) made up over 90% of revenue. Today they’re about 64% (Exhibit 1). The rest now comes from newer sources as Hyperliquid grows from an exchange into a broader financial platform. Specifically:

• Deployer perps (HIP-3): Third parties list perpetual futures contracts on assets like silver, oil, and pre-IPO equities. These entities can capture up to half of the trading fees, with the rest going to the Hyperliquid protocol.
• Builder codes: Wallets like Phantom, user-facing trading interfaces like Hyperdash, and exchanges like VALR, route orders to Hyperliquid and charge a fee on top, making Hyperliquid a liquidity layer for other platforms.
• USDC reserve yield: Under a deal with Coinbase and Circle, Coinbase passes 90% of reserve income from roughly $6 billion in the USDC stablecoin held on Hyperliquid to the platform.
• Spot, gas, and auctions: Hyperliquid also earns fees on spot trading in assets like BTC, ETH, and HYPE, plus HyperEVM gas, priority fees, and ticker auctions for new token listings. Together, these brought in about $5 million in September, a small but growing source of revenue.

In our view, the mix matters as much as the total. Non-core revenue was $38 million in September, double what it was a year earlier. Reserve yield in particular depends on deposits and interest rates rather than trading volume, which makes it a steadier income stream.

Looking ahead, regulated access for US traders could be the next lever of growth. Kraken parent Payward intends to become the first CFTC-regulated deployer on HIP-3*, a version of HIP-3 that lets deployers restrict markets to approved, KYC’ed users, while ICE, owner of the New York Stock Exchange, has partnered with leading HIP-3 deployer Trade.xyz to build a US-regulated perpetual futures market on Hyperliquid infrastructure.²

Key Takeaway: Hyperliquid has diversified its revenue meaningfully over the past year. Roughly a third now comes from third-party markets, distribution partners, and stablecoin yield, making the protocol less dependent on the crypto perps it lists itself. Pending US-regulated deployments could open further avenues for growth.

Exhibit 1: Hyperliquid’s revenue is increasingly diversified

1. Artemis. Data as of October 27, 2026.

2. Payward, ICE. October 29, 2026.

The US midterm elections are next week, and prediction markets suggest the Democrats may take control of both the House and Senate (where Republicans currently hold majorities). The digital assets industry has benefited from improved regulatory clarity in recent years, and a change in control of Congress is unlikely to materially affect the outlook. Here is why, in our view:

First, crypto is bipartisan. Data from Pew Research and The Harris Poll show that roughly the same number of Republicans and Democrats hold or use crypto.¹ The GENIUS Act passed Congress with bipartisan support, and earlier legislation during the Biden Administration² also received votes from Democrats. Perhaps most importantly, federal government debt will likely continue to grow unchecked regardless of the makeup of Congress, driving investors to alternative stores of value including cryptocurrencies.

Second, crypto is global. We estimate that roughly 15-20% of global crypto activity occurs in the US—the remaining 80-85% is overseas (Exhibit 1). Regardless of the outcome of the US midterms, users around the world will continue to seek out alternatives to fiat currencies as well as more effective payment systems, and foreign regulators will continue to put in place rules to support digital assets innovation in their jurisdictions.

Third, crypto is institutional. Public blockchain technology is now more deeply embedded into the mainstream financial system, facilitated by institutional adoption. Leading payments providers are building with stablecoins (e.g., Visa, Mastercard, Fiserv, and Stripe), major asset managers have tokenized their funds (e.g., Franklin Templeton, BlackRock, and JPMorgan), and crypto exchange-traded products (ETPs) are now held by many institutional portfolios.³ The private sector has already embraced digital assets.

Key Takeaway: Elections can affect crypto on the margin, just like other asset classes. But the digital assets industry is bipartisan, global, and increasingly institutional, so we believe it will continue to move forward regardless of the outcome of the US midterms.

Exhibit 1: We estimate that roughly 15-20% of global crypto activity occurs in the US

1. Source: Pew Research, Grayscale & The Harris Poll.

2. For example, FIT21 and the SAB 121 repeal.

3. Source: Visa, Mastercard, Fiserv, Stripe, rwa.xyz. Listed asset managers are largest non-crypto-native issuers of tokenized assets.

Zcash (ZEC), a Bitcoin-like digital currency with additional privacy features, turns 10 years old this week (on Oct 28). Zcash has continued to evolve over time, even through extended bear markets and periods when the price of ZEC lagged other cryptocurrencies. One important reason behind this continuous innovation has been the protocol’s consistent financial support for R&D.

On the Bitcoin blockchain, miners earn 100% of BTC rewards in each block. On the Zcash blockchain, in contrast, miners earn 80% of ZEC rewards. The remaining 20% is set aside for the Dev Fund, a pool of capital that supports Zcash development and related ecosystem initiatives.¹ Most blockchains rely on venture capital or other private funding—Zcash is one of the few networks to build ecosystem funding directly into the protocol.

One clear example of Zcash’s culture of innovation has been the introduction of new privacy pools—the structure that gives Zcash its privacy features (Exhibit 1). The network launched with the Sprout pool, then introduced the Sapling and Orchard pools in 2018 and 2022, respectively. The Ironwood pool, launched in 2026 to address a code vulnerability, added quantum-recoverable addresses and formal verification (i.e., mathematical proofs for properties of the code). Each of these initiatives was supported by protocol-based funding.²

We hope and expect that Zcash will continue to innovate to scale transaction capacity, prepare for a post-quantum future, and protect against the threat of AI-powered cybersecurity risks. This will likely require ongoing financial support for developers from a variety of sources and efficient allocation of funding.

Key Takeaway: Zcash has kept innovating over time, partly by directing a portion of block rewards to protocol R&D efforts. A culture of innovation may help Zcash stay prepared for a post-quantum future and AI-powered cybersecurity risks.

Exhibit 1: The evolution of Zcash privacy pools highlights a culture of innovation

1. The current iteration of the Dev Fund allocates 8% of block rewards to Zcash Community Grants and 12% to Coinholder-Directed Retroactive Grants Program.

2. The Sapling Pool was funded when the 20% portion of the block reward was known as the Founders Reward.

The worlds of blockchain and artificial intelligence are becoming increasingly intertwined, with several well-known projects—including Bittensor, NEAR, and World—playing more prominent roles in the development of AI services, blockchain-based agentic commerce, and proof of personhood.

But there’s a lot more going on beneath the surface. We have identified three specific projects currently using blockchain technology to reach even further into the AI buildout, including data collection and training, compute financing, and compute monetization.

• DATA Network (DATA): AI models need data to learn, and model capabilities depend on the quality and variety of their training data. DATA is building tools to collect, license, and track human-contributed data—from photos and videos to voice recordings. Apps built on the DATA network can license datasets to AI labs for model training while rewarding individual participants for their contributions.¹

• USD.AI (CHIP): GPUs power AI workloads, but their high cost means compute providers often need outside capital. CHIP arranges loans backed by GPU equipment and related cash flows. Its onchain pools allow onchain capital to fund GPU-backed loans and give participants the potential to earn yield, helping finance the AI infrastructure buildout.

• Pearl (PEARL): AI demand is driving investment in more GPU capacity. PEARL aims to allow that capacity to do double duty: power AI workloads while also securing a proof of work blockchain at the same time. This would enable compute providers to earn PRL rewards on top of their AI compute revenue stream. PEARL is up 580% in the past three months.²

Key Takeaway: Blockchain’s role in the AI buildout is expanding quickly to include projects targeting real infrastructure needs, from crowdsourcing training data to compute financing and monetization. Their long-term relevance will depend on adoption and competitive economics. We are keeping an eye on them.

Exhibit 1: Blockchain-based projects are helping with the AI buildout in a variety of ways

¹ On October 12, DATA announced plans to move its protocol to Sui, with Walrus as its default storage layer.

² Certain sectors and markets perform exceptionally well based on current market conditions. Achieving such exceptional returns involves the risk of volatility, and investors should not expect that such results will be repeated. Source: Coingecko, data as of 10/22/2026.