Hyperliquid vaults let depositors earn yield by backstopping the exchange's perpetuals market. There are two flavors. HLP, the protocol-run Hyperliquidity Provider, market-makes and liquidates across every listed perp. User vaults are operator-run strategies anyone can launch, anyone can deposit into, with a fixed 10% performance fee paid to the leader. Both share the same risk profile: you are the counterparty to traders on the venue.
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This guide breaks down how each vault type works, what HLP is actually earning right now, how deposit and withdrawal mechanics differ from a Jupiter JLP or a GMX GLP, and what to check before you wire USDC into one.
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HLP is running smaller than it did earlier this year. Per DefiLlama, TVL sits at $187.11M, down 25.7% over the trailing 30 days from roughly $248.8M. Cumulative fees paid into HLP have reached $22.24M, with trailing-year annualized fees at $8.61M and 30-day fees of $293K. Fee flow has slowed with volumes; 7-day fees are $57.8K versus 24-hour of $4.3K (DefiLlama).
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One nuance to hold in mind: DefiLlama's "fees" line captures HLP's 1% share of Hyperliquid trading revenue, not the full P&L. HLP's realized return also includes spread capture, funding, and liquidation payoffs on its own inventory, which is why depositor APR can run above or below the fee number depending on the tape (adapter source).
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HLP is Hyperliquid's protocol-owned liquidity vault. It runs the on-exchange market-making and liquidation strategies that keep perps quoting tight, supplies USDC into Hyperliquid's Earn module, and accrues a share of trading fees, which are all socialized pro-rata to depositors (DefiLlama methodology). Anyone holding USDC on Hyperliquid can deposit, with a 4-day lockup before withdrawals settle.
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The vault's strategies are operated by the Hyperliquid team but the positions, fills, and balance are fully visible onchain through the L1's public state. HLP does not charge a performance fee; profits flow directly back to depositors after exchange fees and rebates net out.
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HLP's trailing returns have hovered in a wide band since launch in late 2023. Per DefiLlama's HLP page, the vault has averaged roughly 15% to 30% APR across most quarterly windows, with drawdowns of 5% to 12% during fast directional moves where the vault held the losing side of a crowded perp book.
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The current tape is a good example of the tail: TVL dropping 25.7% in 30 days reflects a mix of depositor withdrawals and mark-to-market on the book, and Q3 2026 gross protocol revenue is tracking well below the Q3 2025 peak of $7.15M (DefiLlama income statement). The headline APR is misleading on its own. HLP earns most of its return on quiet, choppy days when funding and spread capture dominate. It bleeds on trending days when liquidations move against the book. Treat any single month as noise; the meaningful comparison is multi-quarter returns net of drawdown.
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User vaults are deposit-share contracts that anyone on Hyperliquid can spin up. The vault leader posts initial collateral, picks a strategy (directional, market-neutral, basis, funding harvest, copy-trading another address), and opens deposits. Followers send USDC, receive vault shares, and share PnL proportional to their balance.
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The leader is required to keep at least 5% of the vault's equity as skin in the game and earns a flat 10% of profits above the deposit's high-water mark. There is no management fee. Leaders cannot withdraw their 5% while followers are still in, which aligns incentives at least at the floor.
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Deposits to HLP and to user vaults both go through the Hyperliquid web app or API. You need USDC bridged onto the Hyperliquid L1 first, typically via the native USDC bridge from Arbitrum (which uses Circle's CCTP under the hood). From there, navigate to the Vaults tab, pick a vault, and choose a deposit amount.
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Withdrawals have a lockup. HLP locks for 4 days from the moment of deposit. User vaults default to a 1-day lockup but the leader can extend it. Once the lockup clears, withdrawal requests are processed at end-of-day vault NAV in USDC, which lands back in your Hyperliquid spot balance.
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The headline risk for every Hyperliquid vault is that you are taking the other side of the venue's traders. When a trader wins big, the vault loses. HLP and user vaults running market-making or basis strategies are short-vol by construction; they collect small profits often and occasionally eat a fat tail. The trailing 30-day TVL drop of 25.7% is a live reminder that the drawdown side is real (DefiLlama).
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Beyond strategy risk, you carry venue risk on Hyperliquid itself. The L1 is a young chain run by a small validator set, and the exchange's matching engine, oracle, and bridge are all areas where a bug or outage would impact vault NAV. The USDC bridge between Arbitrum and Hyperliquid is a specific point to understand before depositing size.
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User vaults add operator risk on top. A leader can drift from a stated strategy, take excessive leverage, or simply be a worse trader than their early track record suggested. The 5% skin in the game caps but does not eliminate this. Read the leader's full trade history before depositing; every fill is public.
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The three vaults are often grouped together but have different risk profiles. HLP and JLP are protocol-run liquidity vaults; Hyperliquid user vaults are operator-run strategy products. The table below shows the practical differences, with live TVL where available.

JLP's index exposure means it tends to track up with crypto majors and pays yield from trader losses plus borrow fees. HLP is closer to delta-neutral on average and earns from spread and liquidation capture. User vaults can be anything in between, depending on the leader.
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HLP is the closest thing on Hyperliquid to a passive yield product, and it has shipped real returns through several full market cycles. For a depositor who understands they are a short-vol market maker, sizing into HLP at 5% to 10% of a stablecoin allocation is defensible. The current 30-day TVL contraction is a reminder to size against the tail, not the trailing average.
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User vaults are a different beast. Treat them as actively managed funds with no regulatory wrapper. Vet the leader's track record over at least six months, check their max drawdown, and verify they hold the 5% minimum. If a leader's returns look too smooth, they probably are; ask what they would lose in a tail event.
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HLP TVL, fees, and income-statement figures pulled live from DefiLlama's HLP page on Aug 17, 2026. Fee-adapter definition and code path documented in the DefiLlama dimension adapter. HLP mechanics, lockup periods, fee structure, and user vault rules verified against Hyperliquid's official documentation at hyperliquid.gitbook.io. JLP comparison data sourced from Jupiter's docs.
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