AFX has launched as a new Layer 1 network for perpetual futures, aiming to compete with Hyperliquid's established market leadership.
By spring 2026, Hyperliquid emerged as a leading platform in the perpetual decentralized exchange (perp-DEX) market, boasting trading volumes of $190.28 billion in April alone, representing 3.9% of the overall market. Despite its success, the platform faces ongoing challenges related to infrastructure, particularly concerning the manipulation of meme coins and the instability of mark prices during peak trading times.
On May 18, 2026, AFX entered the competitive landscape as a new Layer 1 network specifically tailored for perpetual futures trading. This article explores AFX's unique operational framework and contrasts it with Hyperliquid's established model.
Hyperliquid's Dominance
Hyperliquid has set a benchmark with its fully on-chain order book, which offers a user-friendly experience for traders. The platform's HIP-3 update in October 2025 enabled developers to create their own perpetual futures markets by staking 500,000 HYPE tokens. This flexibility allowed market creators to establish various parameters, including contract specifications and leverage limits.
Hyperliquid has proven its resilience through various stress tests, though it has not been without incidents. For instance, in March 2025, a manipulation incident involving the JELLYJELLY token resulted in significant losses for the platform, prompting the team to halt trading and delist the affected contract. A similar situation occurred in November, where another meme coin attack led to substantial losses and a temporary suspension of deposits and withdrawals.
AFX's Innovative Approach
Positioning itself as a Sovereign Trading Layer, AFX has created a dedicated infrastructure for professional derivatives trading. It utilizes a custom execution layer and a modular structure based on the Mysticeti consensus, which separates execution from consensus processes, enhancing order flow efficiency.
Unlike Hyperliquid, which emphasizes a broad ecosystem, AFX focuses on a vertical trading stack, integrating essential components into a cohesive system. Key features of AFX include zero gas fees and mechanisms to protect against miner extractable value (MEV), which collectively enhance the trading experience by reducing costs and increasing transaction efficiency.
At launch, AFX offered contracts for Bitcoin, Ethereum, gold, and oil, with leverage ranging from 25x to 40x. The platform also supports deposits through the Arbitrum network, targeting the same macro asset niche as Hyperliquid.
Performance and Reliability
While Hyperliquid boasts an average order execution time of 0.2 seconds, AFX claims an even faster average of 0.12 seconds, with potential throughput reaching up to 200,000 transactions per second. However, the true test of reliability will come during market volatility, where AFX aims to maintain stability and order processing efficiency under heavy loads.
“In moments of high activity, it’s crucial for the system to handle orders predictably and efficiently,” said AFX representatives, emphasizing their focus on stability during peak trading times.
Mark Price Mechanism
AFX's calculation of mark price utilizes a median from three independent sources, including an external oracle price and data from both its own order book and major centralized exchanges. This multi-faceted approach minimizes the risk of manipulation and ensures more accurate pricing during volatile conditions.
Liquidation and Risk Management
AFX has implemented a four-phase liquidation process designed to manage risks effectively. This system gradually escalates restrictions as asset values decline, providing multiple layers of protection for traders and the liquidity provider vault.
Additionally, AFX's cross-margining allows unrealized profits to count as collateral, offering traders greater flexibility in managing their positions without needing to withdraw profits prematurely.
Future Outlook
AFX aims to attract professional traders, market makers, and quant traders by focusing on capital efficiency and a high-quality trading environment. The platform's economic model avoids venture capital pressures, emphasizing community-driven growth and trader incentives.
As AFX prepares for its token release, its success will hinge on its ability to retain liquidity and professional participants while navigating the competitive landscape established by Hyperliquid.
