Zhao’s Dark Pool DEX Can Drown HyperLiquid, Says Top Trad
A new front may be opening in the world of decentralized exchanges (DEXs), with Binance creator Changpeng Zhao (CZ) making headlines after launching a dark pool perpetuals DEX. Top trader James Wynn shares his belief that the move can jeopardize and even annihilate HyperLiquid’s edge in on-chain derivatives trading.
Wynn Criticizes HyperLiquid’s Referral and Incentive Model
Wynn, a volume trader, has openly criticized HyperLiquid’s policy on partnerships and payments. For bringing users and a big volume to the platform, Wynn claims that he earned mere $34,000 in referral revenue—labeling it “extremely poor” in comparison to competitors.
He has revealed that HyperLiquid spurned his attempts at seeking a more organized promotional partnership, with the platform reportedly shying away from such deals with solo traders or influencers.
Zhao’s Vision: Dark Pool DEX with On-Chain Settlement
Zhao’s dark pool DEX concept focuses on solving transparency issues that plagued current DEX architectures—essentially the problem of front-running and Miner Extractable Value (MEV).
“I have always been puzzled with the fact that everyone can see your orders in real-time on a DEX,” Zhao said in a recent post. He proposes shielding order data using techniques such as zero-knowledge proofs while preserving on-chain settlement, aiming to eliminate the inefficiencies that deter large-volume traders.
Wynn: Zhao’s Resources and Track Record Are Key
Aside from grievance about compensation, Wynn warned of a more insidious danger: Zhao’s track record, size, and network. He believes the Binance founder is best positioned to create a market-leading product in the domain of decentralized perpetuals.
“CZ has the resources, network, teams to create something like no other,” Wynn said.
HyperLiquid’s Transparency May Be Its Weakness
HyperLiquid already operates on a fully on-chain, transparent order book—a strategy which, while consistent with decentralization ideals, leaves users vulnerable to MEV and exploitative trading tactics.
Wynn argues that Zhao’s vision of a dark pool directly targets these vulnerabilities, and could entice traders away from platforms such as HyperLiquid if properly implemented.
